Last week, I was fortunate to be able to participate in the Inman Data Summit in my small way as one of the two co-moderators. Some of the conversations that occurred, both on and off the stage, are among the most important in the real estate industry today. Since I was “working” the whole time, however, it was difficult to wrap my head around some of the more interesting things I saw.
In fact, I don’t think I can do some of the topics justice in a short blogpost. What I can do is simply to highlight a few of the more interesting issues that came up.
Competing Visions of the MLS
One of the most important and interesting things that I saw at the Data Summit was the clear articulation of two, if not three, competing visions of what the MLS ought to be.
The first vision — MLS as Exchange — was articulated by Art Carter, CEO of CRMLS (disclosure: CRMLS is a client) during his keynote at Data Summit. His vision is that the MLS is fundamentally a mechanism to enable cooperation by competing brokers and that the MLS should focus more on discipline and less on innovation. This is not an exact quote, but Art did say, “What we do isn’t sexy, but it is absolutely essential”. Under this vision of the MLS, innovations should be left up to the brokers and competition between them encouraged, while the MLS focuses on the data itself to enable cooperation.
The second vision — MLS as Consumer Portal — was (and frankly, has been for a while) articulated by Bob Hale, CEO of HAR throughout the data summit. The essential insight here is that the MLS needs to be consumer-centric, rather than broker or agent-centric. Simply ceding the delivery of value to the consumer to portals such as Realtor.com and Zillow is to risk becoming irrelevant. The focus of the MLS, then, should be on connecting consumers with realtor members of the MLS, through a robust consumer web portal, agent ratings, and other tools that leverage the MLS’s unparalleled superiority of property data into competitive advantage in delivering consumer value.
The third vision — MLS as Enabler — was articulated by John Heithaus, CMO of MRIS (disclosure: MRIS was a client) during the final wrap-up session. I’m still trying to understand the full scope of this third vision, but it seemed to me to take Bob’s vision of the MLS as consumer-centric to the next level. John spoke about emulating the music industry’s “360 degree deals” (in which the record label takes on everything related to music, from live performances to merchandising, instead of limiting itself to producing recorded music) in real estate. He spoke about doing the work before a consumer even gets into searching for properties, as well as providing support for real estate professionals during the transaction (e.g., transaction management systems) as well as after the transaction (e.g., follow-up systems?).
[NOTE: To be fair, it may be that Bob Hale’s actual vision is the same “MLS as Enabler”. But his public statements to date have mostly been about the need for public facing websites, for providing accurate agent ratings, etc.]
These three visions are in competition with each other, if not in outright conflict. And many of the interesting discussions down below have at their collective hearts this issue of which vision is dominant. For example, your answer to who should control the rules for syndication will depend in part on to which vision of the MLS you subscribe.
So as all of the conversations continue, keep an eye out on the vision thing. It’s fundamental.
Who Is the Customer?
A related concept that came up in one form or another was that a number of organizations have a lack of clarity on who their customer is. I heard executives at MLS, at brokerages, at franchisors, at technology companies and at major portals say things like, “both the consumer and the realtor are our customers”. Or, they might say that both the broker and the agent is their customer.
It turns out that pretty much everyone in real estate looks to the real estate agent as the customer. Brokers say without hesitation (except one rare case, see below) that the agent is the customer. The portals would say that the agent is their customer, because most of their advertising dollars come from agents. The MLS says the agent is the customer, since their subscriptions are paid by the agent. The Associations may not think of them as “customers” but their members are all agents, and they’re the ones paying the dues. Many of the vendors — such as IDX vendors, mobile solution vendors, etc. — regard the real estate agent as their customer since that is who makes the purchasing decision and hands over the credit card to be charged.
Is it any wonder that so many parts of this industry looks at other parts as competitors? They’re all trying to deliver value to the same customer: the real estate agent.
As a matter of fact, the whole definition of what a customer actually is is not all that clear in our industry. Quite a few people think the “customer” is the person/entity to whom one is trying to deliver value. On that basis, to use a typical MLS as an example, the buyer and seller are customers, the Association is a customer, the broker is the customer, and the agent is the customer.
Here’s how I identify my customers: the guy whose name is on the check is my customer. Others may be stakeholders, important constituents, partners, and so on, but only the person/company that pays me is the customer. Might I suggest that the industry could do worse than adopting the same definition of the customer in thinking through who the customer is?
By the way, the one broker who told me without hesitation that the customer was the buyer and seller? Krisstina Wise of GoodLife Team. Ask her about that next time you see her. 🙂
More To Come
You ever feel like your head has been stuffed full of thoughts, new insights, and threads you want to follow up on? That’s how I feel. But I have no time to do any of those things. So I’ll just leave it at the above two, and get back to work.
As always, your thoughts, criticism, and agreement (and disagreement) are welcome.