Inman News is reporting on an upcoming issue with IDX: whether IDX should be distributed “via RSS”. [Since I’m on an iPad, I won’t be copying and pasting text from the story. Go read it in full, though.]
Basically, the issue is that some people want to put IDX listings on Facebook, Twitter, and various mobile apps. The proponents say, “What’s the big deal anyhow? It’s not like listings aren’t everywhere anyhow.” The opponents, the most prominent of which is quoted in the story as being Realty Alliance, say that this would lead to chaos, the listing agents violating their duties to clients, as well as MLS IDX rules.
All of this, of course, is very interesting — and should make NAR Mid-Year even more interesting than usual. But coming on the heels of the syndication debate, the Franchise IDX debate, this makes me wonder, “Why IDX at all?”
A couple of years ago, at Inman NY, I remember speaking with a bunch of really smart real estate tech guys and suggesting that IDX might have outlived its usefulness with how dominant Google has become. And IDX blew up to be a mainstay of real estate tech. But the central issue I was worried about then has not been resolved. If anything, these conflicts suggest to me that we’re headed towards a showdown.
Asymmetry of Value, or The Freeloader Problem
The central issue with IDX is that it creates significant asymmetry of value, and as technology advances, the asymmetry grows.
We might ask, why would a listing broker allow competitors to put his listing on their websites at all? The argument is that such additional exposure brings more buyers to the listing, thereby helping the listing broker fulfill his responsibility to the seller client. Plus, by participating in IDX, the listing broker can put the listings of competitors on his website as well, and hope to capture buyer leads.
Trouble with this theory is that in practice, every consumer (or nearly every consumer) begins a real estate search on Google. And if it is the case that your competitors all have better search engine rankings than you do, then putting your listings on IDX to be exposed has value. Of course, if all of your competitors have better SERPS than you do, you probably have bigger problems to address than whether you should do IDX or not.
In reality, between the major real estate portals — Realtor.com, Zillow, etc. — not to mention the major franchise sites, public-facing MLS websites, and never-you-mind the hundreds of thousands if not millions of dollars that major brokerage companies pour into their websites and mobile apps (anyone ever see the Corcoran iPhone App?), in the Year of Our Lord 2011, I’m having trouble imagining a situation where allowing some agent to put your listings on her Facebook profile is going to move the needle much in terms of exposing your listing to the public.
The value asymmetry, then, essentially amounts to large brokerages and strong listing agents transferring value to smaller brokerages and weak listing agents to help their competitors build a better online presence, better SERPS, and generate more leads from the Web. Why this is in the interest of a company like, say, Home Services of America, NRT, or Long & Foster has not yet been adequately explained to me.
QR Codes and IDX: Similar, Yet Dissimilar
One argument against the no-IDX position is that pulling out of IDX means a disadvantage in getting listings. Your competitors will tell the seller that they’ll happily put the home in IDX, while you would not — so “you’re losing exposure” by going with the no-IDX company.
The same thing could be said for any marketing gimmick. QR Codes come to mind. “We use QR codes, while such-and-such does not, so your home will be marketed better if you give it to us!” The same argument could be made for bus bench ads, singing telegrams, and giant gorilla balloons: we do X, which could theoretically result in more marketing for your house, whereas our competitors do not do X. Seems to me that strong listers get the listing despite not doing every tiny little thing that one could do to market a house, because they seem like experts who can be trusted.
That’s the similarity between QR Codes and IDX. They’re dissimilar in that your using QR Codes does not hurt your business (except for any money wasted on doing QR Codes). But your allowing competitors to use your listings via IDX to improve their web or mobile presence does in fact harm you.
No-IDX Does Not Mean No-MLS
Final thought: just because you don’t put your listings into IDX does not mean you don’t put them into the MLS. The MLS is a private, password-protected, business-to-business tool informing other real estate brokers and agents of properties for sale. Unless your MLS rule is such that putting a listing into the MLS automatically means it’s in the IDX (and as far as I’m aware, no MLS has that actual rule), you are free to put the listing into the MLS, free to allow it to be syndicated to sites you approve, while not having it in the IDX.
The no-IDX listing would still show up in VOW feeds, show up in MLS-managed emails (which requires registration, a pre-requisite for VOW), and the like. And you can do whatever you want with it on your own website, on your own mobile app, and the like.
What Will It Take for Big Players to Withdraw from IDX?
So given the above, and given the brouhaha over Franchise IDX, what I wonder about is what it would take for some of the biggest players in the industry to decide that continuing to participate in IDX is not in their best interest. The squawking from a few real estate bloggers may or may not hurt their business much. The accusation of “you’re against innovation!” falls flat if these big players actually, y’know, innovate. How hard is to develop an iPhone/iPad app after all? How hard is it to do better email marketing? How hard is it to leverage social networks using their own listings, instead of relying on IDX?
So I return to the original question, which is the title of this post: Why do IDX At All?
Opinions welcome, as always.
Posted from my iPad: a great content-consumption device, not so great at content-creation.