The real estate industry, like many other industries, has experienced an unprecedented shift in power from the real estate professionals to the homebuyer. More consumers are relying on their mobile phones for on-the-go timely information and instant feedback.
Redfin Real Estate entered the mobile market in August of 2009 with strong positioning for their application with claims that it would be the best Multiple Listing Service-powered app for iPhone yet. The app release caused quite the stir and was trumpeted on real estate websites, tech websites and industry blogs.
What made the Redfin app special is that it isn’t just a search application, but an integrated experience that allows users to use the Redfin website and app in tandem to create customized content by uploading photos and notes to the properties from home tours. There is also a seamless integration with iPhone’s version of Google Maps, as well as the promise that details of every home for sale, as well as photos, would be updated every 15 minutes. The map interface includes icons that represent each type of dwelling including home, condo, and townhome. The logical search functions, clear call to actions and clean user interface made for a positive and focused user experience.
In order to initiate the mobile app development, Redfin established a clear strategy and list of objectives. Matt Goyer, Director of Online Marketing, in a recent interview outlined their fives primary business objectives, which included: 1) increasing customer retention, 2) increasing audience loyalty, 3) increasing website page views, 4) improving Redfin branding and 5) providing an exceptional user experience. The business objectives for Redfin’s mobile app ultimately created the best possible user experience.
Redfin has done an exception job with their app, however they missed an opportunity to reach the broader home-buyer marketing. The app is only available to iPhone users. What about other smart phone users? Android, BlackBerry and Microsoft 7 phone users are left to rely on Redfin’s website but it isn’t optimized for the mobile experience. Their website is content heavy and hard to navigate given the screen size of a mobile device. The form input (for search) is awkward, there is no clear call to action and location-based search is not enabled.
Enter John L. Scott’s approach to mobile. This real estate company chose to bypass a mobile app and instead invested in a killer mobile-optimized website. If a user lands on JohnLScott.com from a mobile device, it automatically detects that and redirects them to the mobile site, m.johnlscott.com. The stationary site includes search information, as well as information on neighborhoods, services and even careers. John L. Scott’s mobile site, on the other hand, only provides information that is relevant to a user currently on their mobile phone. The site leverages location-based technology by providing lists of nearby properties for sale and Google map integration for step-by-step directions to homes. With a single touch, the user can call the closest John L. Scott office. Prefer to send email rather than make an actual phone call? One touch of the email button and it auto-populates an email with the property link as well as well as an email subject line.
As Redfin and John L. Scott have proved, the most important impact of mobile’s information-on-the-go functionality is the way it can empower users. A mobile phone can now be a part of life’s most important moments, such as searching for the perfect house to make a home.
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- Redfin’s App
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- Redfin: Nearby homes for sale
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- JLS Mobile Site
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- JLS Detailed Home Description
What is interesting about Redfin, based on your post, is that there is an impression that it was developed to meet the needs of the average home shopper who had an iPhone. While this is great, if you are shopping for a house, condo, etc., the reality is that real-estate agents would be your best customers. Most people don’t buy and sell houses all the time. So as much as Redfin and John L. Scott want us to believe that they are there for the buyer, the reality is that they are also there to provide valuable information to the real-estate agents. Having a website and mobile application that directs buyers to agents is definitely way to go. In addition to the direct referral, of which there must be a kickback for Redfin, the agent can also see the comments provided by other customers and can use them to close the deal. As a business model, both Redfin and John L. Scott are on the right track. Of course I would be curious to see how they are funding their efforts and how much they get from every transaction that is done as a result of their site. Another question I have is how will other agencies compare and differentiate themselves from Redfin who was first to market and John L. Scott who has built on what Redfin started.
Elizabeth, I hear what you’re saying about real-estate agents being an important target market for home listings — at least I think they are important in the traditional model of marketing and selling houses.
However, I see Redfin’s homebuyer focus as a business positioning strategy rather than an oversight. Redfin, along with similar companies such as Zillow and Estately are putting more power into consumers’ hands by providing helpful information online. I wonder if eventually the real-estate industry will go the way of the travel industry; people used to frequently seek travel agents to plan their trips, until the internet made travel information easily accessible.
As someone who has never purchased a house, I find the traditional process to be mysterious and overwhelming, and I appreciate the greater transparency that these sites provide.
It is really interesting to see various kinds of service gradually appear on the mobile phones. Along with high technology rapid development, mobile phone almost could do any fancy features to fulfill users’ needs. I can tell mobile phone service is very important to real estate because it is related to “locations”. In my opinion, LBS services are always one of the killer services for mobile phones. When I walk on the street, I may not search for some gossip stories of my phones but I definitely search the roads and directions from Google map because I don’t want to get lost. The same situation, if I want to find some on sale houses nearby my currently location, the mobile phone with LBS service is really a helper for me. I just curious about how many real estate transactions happened because of mobile phone? Will mobile phone apps or mobile web services become a source of major income of real estate in the future? It should be an interesting story.
I’m fascinated that real estate companies like Redfin would target their apps at homebuyers rather that the brokers that represent buyers. It seems a homebuyer would only remain loyal, which is one of the five business objectives Redfin lists, as long as they were looking for a home. Brokers who successfully find their clients homes through Redfin’s app would be more inclined to revisit the application. Like Elizabeth notes in her comment, providing information to other real estate agents and sending buyers their way would probably be the most profitable use of an app or mobile-optimized site. Whatever their reason, one has to wonder why Redfin hasn’t expanded their app to work on other mobile devices other than the iPhone.
Elizabeth and Derek, it is worth my mentioning that Redfin has their own dedicated agents, so they are not referring leads to other real estate companies. In fact, they provide all of their agents with iPhones so that they can take advantage of the mobile app both for their own needs as well as their client’s needs if that client doesn’t have an iPhone.
I think that Katy’s comparison to the transformation that the travel industry went through ten years ago is quite interesting. However, I am inclined to believe that the personal relationship that a homebuyer establishes with a trusted agent will ultimately trump technology advancements. When it comes down to it, buying a house is the most nerve-racking purchase that one can make. No matter how much research a buyer does on their own, when it is time to start negotiating the contract having an experienced agent do the work makes all the difference in the world. In my opinion that is why a mobile experience, app or website will be viewed as a valuable tool to the buyer but will not become a big revenue stream to the agencies. It is a great use case for how to effectively leverage technology to improve customer service.
Sites like Redfin, that draw almost real-time from the MLS, are a god-send to consumers exploring home purchases. I have been a member of the Redfin user feedback group for some time and have shared many recommendations to improve their site. It’s true that they have fallen short in developing for non-iPhone applications and new form factors like the iPad. Frankly, I think their lack of continued investment in mobile is a resource issue more than a will.They are a savvy bunch but an android application and an upgrade to their iphone apps are way overdue.
John L Scott’s approach to optimize for the mobile browser is a smart move but doesn’t obviate the need to develop an App. Home buying is an intense and focused experience where the tap of an app over URL input is preferred. Additionally, applications have greater custom design flexibility and might be better tailored to the mobile experience over an optimized site.
The interesting aspect of the debate about who Redfin should target is the notion of the consumerization of IT. Simply put, business users (such as real estate agents logging into the spreadsheet-like MLS) are yearning for visually rich, interactive applications they might enjoy as a consumer. They’d probably like to use an adapted, richer version of Redfin, but they are reliant on the MSL system they are subscribed to. Redfin contractually can only access limited data so in its current state it couldn’t satisfy a real estate agent and would probably not be successful in licensing greater data from them.
As a consumer, I want the tools to be self-sufficient and welcome further development in the realty space in web and mobile. Only when I am near fully-informed and then need to Agent to come in and close will I actually make the call. He’ll have more property history and a relationship with the seller’s agent that I couldn’t have, but otherwise we are both seeing the same information, albeit mine might look prettier most of the time!
Thanks
I agree with Elizabeth about these mobile applications being more for the agents than the consumer. Nonetheless, I recognize the value of a mobile real estate application that allows me to search for a home for sale on a whim. If I am driving through a new neighborhood that looks attractive I may want to look up homes nearby while I’m there. That’s a problem that only a mobile application can answer.
It is true that mobile applications have transformed the industry, I can definitely agree with that. I work for a real estate appraisal management company and we are currently looking into developing our own app for appraisers so they can accept orders while in the field. I have already spoken with many of our appraisers who have told me that mobile applications like MLS, and Google Nav are doing great things as far as optimizing their processes. I can respect the fact that in Real Estate, most of the players involved are often on the road, and mobile applications are now optimizing everyone’s time.
At the same time I am frustrated with applications that claim to be a valuable consumer resource, but instead actually hurt the industry. I noticed that Katy mentioned Zillow as an app that “puts the power in the client’s hands.” But the reality of that app and other valuation tools like it is that they are extremely inaccurate, and cause more harm than good. They are not frequently updated and miss many of the valuation metrics that need to be taken into account when purchasing or refinancing a home. Because Zillow has branded itself as a mobile, user-friendly valuation model, people begin to trust the app and believe that when they are out shopping for a home they can quickly look up an address and see how accurate a listing price is to the actual value. But working for an appraisal firm I have seen many times that the Zillow “Zestimate” was off at or around $100,000 – which is substantial. We get consumers calling us all the time angry that their appraisal came in under (or over) what they got off the Zillow app. Mobile applications are great for the most part, but there are just some things that technology can’t replace.
It just so happens that I am currently house shopping and I have downloaded every droid app in the book to aid my process. I have written my own Real Estate App Review at http://bit.ly/fINS9l.
I also forgot to mention, if you are looking for home valuation or assessment information forget Zillow, visit your local assessor’s website http://www.kingcounty.gov/assessor.aspx, they don’t have an app (yet) but they have much more information regarding the home and it’s value history (including tax assessments) and it is guaranteed accurate.
As a hopeful homebuyer (we have not yet listed our current residence), I have much experience using the John L Scott mobile website. It is amazing what the technology has done for us! We can go visit locations we like and search based on the proximity to our current location, then drive by each of the results to get the “real scoop.” It has really revolutionized searching for new homes for us.
And the next step will be listing our current residence – a condo in downtown Kirkland (you can see why we’re waiting if you know the market
. The Redfin app will be extremely useful for us if we decide to use Redfin as our listing agent. Redfin’s app is for us, the consumer, to empower us. However, the lack of the app on any device other than the iPhone will probably add to my husband’s dilemma on whether to keep the Win7 phone or go back to his iPhone. So many apps are just for the iPhone that they’ve created a unique positioning to keep their first to market advantage: the app marketplace is more robust than that for any other handset right now.
I’m working for a company that has to decide whether to create an app or build a mobile site next, and I’ve recommended the mobile site vs. the apps for the reason that we should be making the app for the leading mobile platforms – Android, iPhone, Windows, and Blackberry. That’s a lot of development work! Which is why I think the John L Scott mobile site has gained such a hot following – it works on any smartphone device. Have I mentioned that I love it? Here’s to continued innovation in the US marketplace for industries like Real Estate.
I’m a real estate professional in Columbus, OH. I have found many of your comments very interesting.
And, when it comes time to make big decisions on your investments, interview and hire the right professional(s) to help you come to the best decisions for you or you and your family.
“Will the real estate industry will go the way of the travel industry;?” I really don’t think so.. while travel/vacations have pieces/parts; flight, car, hotel, etc… like RE transactions have parts; staging, marketing, photos, finding the house, getting the right financing, title, negotiations, etc… A vacation might be $5000+ vs. RE transactions often exceed $500,000 and 1 minor error could easily carry the risk/cost of having full service representation from a RE professional. Quite often, people have the majority of their wealth tied to their home.
Making a wise decision about which home to buy (and what financing makes sense for the house and buyer) is critical in the event a home-owner needs to sell. I’d love to see statistics on the foreclosure market; how many people in trouble used an experienced agent, and how many did not.
I think information available on the Internet is great for our industry, however, I wish the data was more reliable and the goals of these sites weren’t aimed so much toward capturing the consumers’ information and selling the information to RE agents/brokerages and mortgage lenders. Mobile apps are great for consumers! Buyers can be in front of a house, bring the listing up on their phone, and see pictures and receive the information they need, WITHOUT CALLING THE NUMBER ON THE SIGN!
The for sale sign in the yard is a marketing tool for the listing agent. The listing agent was hired to market and SELL the house for the current home owner. If you don’t want to buy that house, they hope to SELL you on using them to help the buyer buy another house. Most likely when someone calls the phone number on the sign, they’ll get a voice mail or a receptionist, it’s a pita for the “shopper”. The phone apps gives the interested party immediate access to the desired information without having to deal with a salesperson.
Does a seller still need a Realtor? Yes–your listing won’t be on all the Internet sites/phone apps without one. And, there’s more to selling a home than being on the Internet, there’s staging and pricing, negotiating, documenting the paperwork, and anticipating/preparing for possible issues with the transaction. Remember, this is your home…
Does a buyer still need a Realtor? Yes, finding the right home is only one part of a real estate transaction. Unless you’re buying and selling homes on a routine basis, there’s no way to have the kind of experience to be able to navigate through the very complex process and decision making. If you don’t buy right, you can’t sell right…
Remember, you’d never address a court regarding a matter over $100K+ without an attorney. So, don’t become a statistic in the “I can’t sell my home” class! Have fun using your phone
Better access to information will definitely save on time, gas and will help enable a more educated decision, but won’t eliminate the need of RE professionals.
This is a great post and interesting conversation. (Do I detect a hint of worry from Ms. Murry, RE agent from Ohio with the transparency which these tools offer to consumers?) How times have changed and for this industry. I remember life in Silicon Valley when web 1.0 started to come to fruition and I had advised an agent to consider promoting his properties on a website (he just scoffed and said it wasn’t necessary!). I love the Redfin site and really appreciate the fact that I don’t have to get information from a realtor because, as a potential homebuyer, I may wish to do research and remain uncommitted and unattached to a specific agent. Several homes in our neighborhood were sold privately using, of all things, Craigslist. The sellers worked for Amazon and the buyers are Microsoft employees, so perhaps there needs to be a level of comfort and trust using technology (I do believe they had a realtor involved later at some point). Question for anyone: I haven’t heard of the term mobile website. I wonder, does it require a different code vs. reg website? Can anyone tell me more. Thank you!
Katy, as a Realtor I can tell you that Real Estate Agents will never go the way of the travel agent. Although buyers can find all kinds of information on the internet they need to know how to interpret it and I can tell you from 11 years in the business that they really don’t. Many of the zestimates on Zillow are very inaccurate in our market where a view can add up to $50,000 on the price of a home. There will be a few who will be able to use the data to buy or sell a home but I liken it to people who do their own financial trading. It’s a special person that can do that. Realtors bring so much more to the transaction then just finding the home. I have been through 100′s of transactions and know what is common and customary, I know what the laws are that affect buyers and sellers and I educate buyers on what they will need to know when they sell because you make money when you buy not when you sell.
As for the “power shift” mentioned in the first paragraph, I don’t see it as a power shift at all. Our jobs as Realtors is to educate our clients and by them having access to the data prior to meeting with us makes them an educated consumer. And an educated consumer is my best customer.
Having worked in the real estate industry years ago, I appreciate the accessibility of information a phone app provides, but in some ways it’s not really all that new. When I worked in real estate and a home came on the market, a listing office would push out that home’s information through all communication vehicles available: mobile text messages, emails, websites, faxes, dare I say it – fliers, and even face-to-face meetings with agents. The idea was to deliver listing information via all available vehicles so that agents and buyers could get to it through their medium of choice. Now they can add mobile phone apps to the list. Yes, these apps are an improvement in that they include more extensive information about a listing and that’s always helpful. But as many have mentioned in their comments, these new apps do not eliminate the need for a good agent. More data demands more interpretation and that’s one of many stages in the buying/selling process in which an agent demonstrates his/her value. Savvy agents will welcome advances such as these phone apps. They help to find the right home for their buyers and help listing agents better market their clients’ homes. Most agents know all too well that clients who have uninformed and therefore unrealistic notions of the real estate market are the hardest to work with, the most time-consuming, and end up the least satisfied. Informed clients make smarter buying and selling decisions. So get the app, but remember to call your agent, too.
I think this post touches on how technology has increased transparency for consumers to the point where it has fundamentally changed the traditional course of business for many industries: travel, financial services, real estate, retail, etc. With the push of a mobile device button, consumers can access the same level of detailed information that the industry professionals can, which ultimately cuts into the value of their professional services. Focusing on the single-family housing real estate sector, recent research shows that industry employment has declined by 5.3% for the last five years. Although the obvious explanation for this statistic is that the industry was deeply affected by the recent recession (and still continues to be affected), this posting and its subsequent comments support the idea that another key contributor to the decline is technology.