Google's place in real estate
Search giant's move seen as part of larger trend for online portals
By Andrea V. Brambila
February 14, 2011
Google's announcement last month to discontinue its real estate search option at Google Maps evoked a range of response from within the real estate industry -- dispelling fears for some while dampening hopes for others that Google would make bolder forays into the business of real estate or create a public "universal multiple listing service" to serve as a unified source of real estate information for all.
Although Google officially announced plans to pull the plug on real estate listings published on Google Maps on Thursday, as of today some real estate listings are still visible -- the "real estate" search option is still available on Google Maps and returns property listings when the results are unfiltered (the ability to filter listings is no longer functional).
The real estate search functionality at Google Maps had been active in the U.S., Australia, New Zealand, the United Kingdom and Japan.
Google cited low traffic, infrastructure challenges, and the proliferation of property-search sites among the reasons for its decision to retire real estate listings from Google Maps.
Google Base will also be retired and replaced with Google Shopping APIs, which will not support real estate listings.
And the end of real estate listings on Google Maps will also mark the end of "Place Pages" for those listings, according to the blog Search Engine Land. Google rolled out the pages, where the search engine combines all the information it has about a particular location, for individual real estate listings in the fall of 2009.
"(W)e recognize that there might be better, more effective ways to help people find local real estate information than the current feature makes possible. We'll continue to explore this area," the company said in its announcement.
Some worried that Google's vast consumer reach would enable the company to construct a powerhouse real estate search portal. The company is second only to social networking giant Facebook in U.S. Internet traffic and is, by far, the most-visited search engine on the Web.
"Some industry speakers five or six years ago were using (Google) as a fear tactic. I saw it as just another place to go and look for real estate. When my wife about three years ago wanted to look for real estate she went to Google ... because she was familiar with search in general," said Saul Klein, senior vice president of listing syndicator Point2, which had been feeding MLS listings to Google Base.
"People had that inclination. Google maybe thought they could capitalize on that and it didn't pan out the way they thought."
Google did not respond to a request for comment on this story.
Klein declined to share how much traffic and leads the listings Point2 syndicated to Google Base generated.
"As you can imagine, Google gets a lot of activity. I have no reason to doubt Google that (its) traffic was not significant ... of course, (its) idea of significant traffic is not the same as everybody else," Klein said.
Crowded real estate space
Klein said he anticipates other property search portals to benefit from Google's stepping back, at least in the short term.
"The number of people who shop for real estate on the Internet is not going to change because Google terminated one of its data projects. (People) will still go to Google and do searches on Google. In the short run, people who can't go to Google Base might end up going to Zillow or Trulia or Realtor.com," Klein said.
"The fact is: There's one less real estate portal out there in a space that has all these real estate portals. It's a pretty crowded space, so maybe the others scared them away," he added.
Trulia and Realtor.com have said they don't expect their site traffic to rise in any meaningful way because of Google's decision. For search sites exclusively devoted to real estate, however, Google's abandonment of listing aggregation may represent a kind of vindication.
"It really goes to show how hard it is to do what we're doing. Google employed a similar strategy to what Trulia created, and with all the might of Google they didn't succeed," said Pete Flint, CEO and co-founder of property search site Trulia.
"We've spent over five years and a significant amount of infrastructure to remove poor data. That's really tough. We've spent a lot of money on it and we're not done yet. It doesn't seem to be a problem that Google is focused on solving," he said.
Google displayed listings submitted by agents, brokers, REALTOR® associations, and third-party listing syndicators like Point2 and ListHub, which was acquired by Realtor.com operator Move Inc. in September 2010.
ListHub also declined to provide traffic numbers for Google Base. The company did provide a "scorecard" for the service in which Google reported, among other things, that it did not remove duplicate listings from its database.
Similar scorecards are available for other property portals that ListHub works with.
Accuracy and consumer experience matters
"It's challenging to create a database and keep it comprehensive and keep it accurate. We spend millions of dollars every year (to do that)," said Errol Samuelson, president of Realtor.com. Realtor.com updates about 75 percent of its 4 million listings every 15 minutes, according to the company, and gets its listings directly from multiple listing services.
"When something happens on the MLS, you want to reflect that change. With Google there wasn't necessarily any assurance that people would come back (to post updates). I think it was a challenge. One of the things Google prides itself on is accuracy -- the veracity of their information."
Ensuring the accuracy of real estate information "is not just a Google problem. It's almost an endemic problem," he added.
Gregg Larson, co-founder and CEO of real estate information technology consulting firm Clareity Consulting, said he hopes Google's withdrawal marks a turning point for the industry in reclaiming real estate traffic for its own sites and affiliated sites, like Realtor.com and public-facing MLS sites.
"Accuracy matters, and being the original content owner helps. In addition to quality control, I've always advised our clients to offer several more fields of information on their own site than the data they choose to syndicate, and ideally have their site be updated (in) real-time while all others have a time lag -- from a few hours between updates to a once-a-day refresh -- so the MLS or broker can truthfully promote the fact that they have the most comprehensive and up-to-date real estate site for their market," Larson said.
"Being the most accurate, comprehensive and real-time site is a real advantage for the industry-controlled sites."
In addition to data-quality issues, Google's listings interface left much to be desired in terms of consumer experience, Trulia's Flint said.
"Consumers want more than real estate listings on a map. They want data. They want analytics. They want local content. On the whole, the state of quality (for listings on Google Maps) was really, really bad.
"Accuracy and comprehensiveness of data ... is crucial in the real estate industry and Google didn't have the appetite to solve that problem," Flint said.
Jonathan Osman, a broker at Keller Williams Realty in Charlotte, N.C., said his firm sent listings to Google but got no leads or inquiries from the service.
"The information they gathered was far too basic and it wasn't user-friendly at all. Personally, (I) think there are too many real estate websites. It's having a profoundly watered-down effect on the home-search experience," Osman said.
"Consumers are looking for the most data but most sites show a very limited amount of data cluttered by ads and other cyber-trash. That would irritate me as a consumer."
Some will miss Google Base
Real estate professionals contacted by Inman News had mixed reactions to Google's decision. Many said they did not upload for-sale listings to Google Base, and responded with indifference. Among those who said they did use Google Base, some saw results and some didn't.
"The main point of consideration from my perspective is the drop in customer reach when Google no longer presents real estate data. Though we syndicate our listings to various real estate portals, it is a known fact that Google, by default, is one of the destination sites.
"It is one of the more trusted sites and people recognize the value in that," said Gurtej Sodhi, chief information officer for Memphis, Tenn.-based Crye-Leike REALTORS®, one of the country's largest real estate brokerages.
"The majority of traffic to listings comes to us on our own website (over 90 percent), but at the same time Google has been one of the top three referring sites that we do syndicate our listings to. That amounts to a substantial number of redirects to our site as well as a substantial number of leads generated," Sodhi said.
A manager for Arizona Regional MLS said the MLS would be losing valuable exposure to potential buyers as a result of Google's phase-out of Google Base real estate listings.
"The January ListHub traffic report (for the MLS) reveals Google (Base) delivered nearly 50 percent of the total consumer traffic generated by all 43 ListHub channels. Google was third in consumer inquiries, phone or e-mail," said Brian Wharton, the MLS's business development manager.
Real estate brokerage sites attract the most listings traffic
Like Sodhi, other real estate professionals said most of their traffic comes from their own websites.
"Google's overall effectiveness with regard to real estate listings is probably best told by the fact they made the right decision to cease providing that service," said Bob Hale, president and CEO of the Houston Association of REALTORS®.
HAR in December 2006 became one of the first industry associations to push members' listings to Google Base.
Hale said he believed the decision's impact on the Houston market would be "minimal" due to the high traffic generated by the association's own website, HAR.com.
"Yes, I sent all my brokerage's listings to Google," said Jay Thompson, broker-owner of Thompson's Realty in Phoenix. "To my knowledge we never received a single lead from having a listing on Google. But, we syndicate listings to many sites, so it is not always easy to tell from exactly what site a contact may originate from.
"I am positive, though, that the vast majority of prospects we generate from our Internet presence and marketing come from our own websites, not the national players. I am not concerned, in the least, about Google's dropping real estate listings," he said.
Like Thompson, many real estate professionals don't actually know where every lead comes from -- and therefore have a hard time gauging a particular channel's effectiveness.
"With so many different sites available, we oftentimes are not 100 percent sure, and sometimes even the client isn't, as to what site they first saw the listing on," said Alexis Eldorrado, managing broker at Eldorrado Chicago Real Estate.
"Many times, the buyer has seen it on multiple sites. For example, they may be looking at Yahoo Real Estate, Realtor.com, Eldorrado.com or Zillow and find the same listing on all four sites. It is hard to track where exactly their Internet origin ... so truly if they don't find us on Google, they will find us somewhere else."
Other large search portals make moves
Google's move comes on the heels of a mid-January announcement by Realtor.com operator Move Inc. that it would power AOL Real Estate's listing search. Property search site Zillow and Yahoo Real Estate flipped the switch on a similar deal earlier this month.
"Mainly we see Google's exit from real estate as being part of a trend where the large search engine players are moving away from direct involvement with real estate advertising, either outsourcing the management of their real estate sections to industry-specific players, or in Google's case, pulling out altogether," said Celeste Starchild, ListHub spokesperson.
"Portals in many cases realize that it makes sense to partner with somebody who has that vertical expertise. We do have that expertise ... to do a great job with it and I think the consumer's expectations are becoming increasingly higher, so to meet those expectations the best choice is to partner," Realtor.com's Samuleson said.
He said he expects other such deals in the future.
Too many real estate search sites?
"I hope for (more consolidation) in the sense that there are a lot of sites out there that aren't really delivering a lot (in terms of traffic) to brokers, so having a half-dozen strong competitors rather than all the riffraff might be the best deal for brokers," said Brian Larson, an attorney and consultant for Larson/Sobotka Business Advisors LLC who works with real estate brokers, associations and MLSs.
As of November 2010, Yahoo Real Estate was the most-visited real estate site on the Web, with a market share of just under 7 percent, according to Web metrics firm Hitwise. And only seven real estate sites had market share higher than 2 percent.
"In any Internet segment there are only a few destination sites that have real traffic. I'm not talking about 'two guys in a garage' who build an app. There's always room for small companies to do interesting things. But at the top there's not much room," said Greg Sterling, the founding principal of Sterling Market Intelligence (SMI), a consumer behavior consulting and research firm.
Some warned that consolidation deals could have an adverse effect on marketing costs, however.
"AOL and Yahoo are essentially selling their real estate businesses to other companies. The companies that are doing those deals are writing big checks to these companies ... and that is ultimately going to add costs to real estate brokers and agents because they will pass on the cost to their advertisers," Trulia's Flint said.
"The combination of consolidation and partnerships will result in fewer, stronger sites and higher fees to advertise," Clareity's Larson said.
"(Google's decision) will negatively impact the free traffic flowing to many websites," he added, as some search sites charge for upgrades in listings that are intended to make them more visible and appealing to consumers.
In a 2007 blog post, Google sought to differentiate its free service from that offered by other property portals: "We don't charge for photos or offer 'featured listings.' We believe that buyers just want to see the home that fits them best and that providers shouldn't have to pay to show it to them. We don't sell houses, deal with agents' compensation, or charge for leads."
Google is not going away
While Google may have closed the door on accepting direct uploads of real estate listings, Google is very much still a presence in the real estate sphere.
"Even with Google's decision to pull their real estate listings, we still love Google and use many of their other technological tools including Google Analytics and their Webmaster Tools and continue to look to Google for cutting-edge tools to help our business continue to succeed and grow," Eldorrado said.
Real estate businesses will still be able to list their offices on Google Places, buy advertising on the site, showcase property videos on YouTube, and use the various applications they have come to depend on in their work, including Google Docs, Gmail and Google Maps.
"Map search is not dead -- everyone will maintain a map tool, but quick, free-form, natural language-based search will be used much more than mapping search," said Clareity's Larson. "Eighty percent of real estate is local, so no map search is needed, but search results on a map are incredibly valuable and used by nearly everyone."
Many real estate brokerages use the Google Maps API to display listings on their own websites, and several major property portals, including Trulia, Zillow and Realtor.com, use the Google Maps API on their mobile applications.
"I have no doubt that Google will remain at the forefront in terms of other Web-based services that will still enable a tremendous number of consumers to access to property-listing information," HAR's Hale said.
"One example ... that I think has tremendous potential is (Google's) Street View, which allows consumers to not only view the listed property but all of the surrounding homes and details of the neighborhood."
As a search engine, Google will also continue to index listings it finds on other real estate websites.
"Google will remain a major source of leads as the world's No. 1 search engine, so it is vital that real estate brokerages and MLSs continue to take advantage of search engine optimization to maximize visibility for their listings. That functionality obviously remains a huge part of the Google brand," Hale said.
That indexing role is more in line with Google's traditional business model: keyword searches that direct the consumer to content, rather than providing the content itself, Realtor.com's Samuelson said.
Google's future real estate plans
Whether Google is truly out of the real estate listings space remains to be seen. Shortly after Google's announcement, the real estate blogosphere was rife with speculation about Google's future plans in real estate.
"My guess is that Google will fold this dynamic data into some other offering of theirs one of these days," said Santa Fe agent Christopher Rocca commenting on a Tech Savvy Agent blog post about the decision.
Others theorized that Google would acquire a major property search portal, echoing rumors that began circulating in late 2009 that Google would buy Trulia. Flint declined to comment on the rumors.
Nevertheless, he said Trulia is not considering any deal similar to that between Zillow and Yahoo Real Estate or Realtor.com and AOL.
"I think this is 2011. The (Web search) portals are not companies that we are betting on for our next phase of growth. Portals are in decline and we are much more focused on other areas of growth, be that mobile, ... user experience, and working with companies like Facebook," Flint said.
At least one former major property search portal, Roost.com, has recreated itself, shifting from property search to focus completely on social media marketing tools.
"At the end of the day, the world doesn't need another property search engine, but REALTORS® absolutely need a social media toolkit for word-of-mouth business," said Alex Chang, Roost's CEO, at the unveiling of the new business model in September.
Screenshot: Google Maps real estate search.
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