Some bold predictions from Mike…

I’ll be bold myself and summarize, but definitely check out Mike’s post for the details on his 2008 predictions:

  1. Zillow does not go IPO
  2. Barton drops CEO title at Zillow
  3. 5 VPs leave Zillow
  4. Redfin gives premium, full-price option
  5. Trulia gets more traffic than Zillow

A big focus on Zillow and not a bad prediction in the bunch.  Nonetheless, here’s my opinions on Mike’s predictions:

  1. Completely agree.   The only way I change my mind is if the mortgage product makes a HUGE splash early in the year (i.e. pre- RE Connect in NYC).  Zillow becomes a LOT more valuable if they can launch one more thing that captures public attention along the lines of Zestimates, and I think, but clearly don’t know, that Barton would feel like he was selling early investors short if he didn’t wait until Zillow did one more big thing (Smart Search clearly does not count).
  2. Disagree. Rich has to do one more big thing before he steps back from Zillow.  He won’t do it pre-IPO.
  3. Disagree. I don’t see this happening.   Again, it’d be like conceding defeat.   Too much money on the line for that.
  4. Disagree. I don’t see this one happening.   Redfin already started going down that path of premium services with the ability for buyers to pay for tours by the hour, but I don’t think Glenn can spin a 6% commission into TV appearances. I expect them to focus on innovative PR initiatives, since that is much closer to the their DNA.
  5. Definitely.  Although that means we’ll probably see even more of David G telling us Zillow’s internal logs show double the traffic.   (Good news if Zillow goes IPO: As Move was a publicly-traded company, I was told never to discuss internal logs…  Although I never found out why, I always assumed this was because there was a fear we’d have to open the logs to investors if we started talking about them.)

7 responses

  1. Well put! on #3 above, I’ll clarify. I don’t see this as a result of firing or layoffs. I see it as a natural progression from folks that have been there for 4 years starting to get antsy and having other opportunities looking attractive. Along the lines of Ben Clark and Vanessa Fox.

  2. Good list but I disagree with #5 and here’s 3 reasons why.

    1 – Part of T’s traffic is simply from the volume of pages they have indexed w/ search engines (according to Yahoo over 10 mill) while Z has around 2 mill. This gets a lot of long tail searches. Z could easily improve their SEO designs and get a lot more pages indexed and probably will as they get listing data feeds from the RE community allowing them to go directly after the same long tail terms as T.

    Z has a lot more natural inbound links (not from same domain) and content than T does and the SE’s love this, so with a little more focus on SEO Z is probably better positioned for growth.

    2 – T is dependent on data provided by the real estate community as a whole while Z is independent. Any decisions on features or charges that T makes can have significant impact on who continues to provide listing data. (look at the charges for featured positions did). T must do everything to be pro-RE community to continue the relationships while Z can release items / features that are more pro-consumer, which in the long run will naturally generate more traffic.

    Z has a value proposition was “values” not listing data, as the RE market continues down it’s current path, ARMS adjusting in record numbers in 08 and now short-sales don’t have phantom income – owners will be looking a values & mortgage options a lot more than before. Z may be in the perfect position to expand on these consumers thought process – What’s my home worth? > Can I refinance? > Do I short-sale?

    3 – Lastly, Z model identifies multiple types of users much earlier in the RE process than T does for multiple reasons. This gives Z more time to develop loyal users for multiple reasons providing a larger base of diversified traffic, which is more sustainable.


  3. Jessie: You make some very good points… Zillow has definitely built a more all-encompassing structure (much more portal-like) than Trulia. However, I put more emphasis on the fact that Trulia has much better listing coverage today than Zillow.

    And the only way that Zrulia will approach Trulia’s listing count is to strike very similar deals that make Zillow just as dependent on listing data from other sources. Similar to Trulia, my thoughts are that Zillow’s growth long-term is to continue enticing more brokers to give them a feed of their listings. Trulia has done a better job of this to date (they’ve also been at it a lot longer) and I think the executives at many of the big brokerages will be more hesitant to support Zillow.

    It is definitely something to watch in 2008!

  4. It’s true that Z will be as dependent but they will most likely make it free vs. T’s business model is to charge brokers / agents much like your ex-employer ;). In the long run may make it easier to get the listings, especially from the individuals.

    I just think that searching real estate listings is so ubiquitous currently that the real value of T is only in it’s strength of it’s SEO emphasis on organic traffic which can be achieved by many others in the space if they elected to.

    I can personally tell you must RE sites don’t get significant traffic simply due to poor site structure which makes them impossible to crawl.

    This leads me to my prediction that there will be a significant dog fight for top organic spots in 2008 as the big brokers will get hip to spending some serious money on proper seo site design which will put big pressure on T for those local search results as the G, Y and M will tend return higher results for a local RE companies vs. T all things (seo wise) being equal.

  5. Jessie: I’d definitely agree that in 2008 the big players will figure out how to do a better job capturing SEO value out of their sites. Although it can be deceivingly difficult to improve SEO on large sites once the site structure is in place. In that sense, Trulia definitely has a leg-up in that they did a better job designing their backend for SEO right from the beginning and it shows in their consistent organic growth.

  6. Firstly congrats to Dustin on a great blog – now a must read for many of us.

    I have just made a note in my calender to go back to this blog post in December 2008, I’m curious to see how accurate everyone is!!

    Here at Trulia, we are very focused on building audience next year – we grew on average by around 10% every single month for at least the last 12 months and internal numbers show that’s around 3x from this time last year. I’m sure there is more growth to come. Yes, we do appear fairly high up the search engines, but we’re experiencing the fastest growth from non-search engine sources – ie people typing in into browsers and links from third party sites. As we’ve invested in building a good product, we increasingly expect more direct traffic and brand awareness.

    There is some commentary about Trulia’s focus on homes for sale search and listings whereas other sites have a broader focus. A couple of thoughts on this:
    1) searching for homes for sale from all the research I’ve seen is the most popular real estate research activity Hence, we think this is the most important thing to focus on. It’s a very hard problem to solve and we’ll be continuously working on it and improving it.
    2) Trulia is most well known for it’s search experience which we launched first but the site now is much broader in terms of product offering. Our tens of thousands of city and neighborhood guides launched in 2006 were groundbreaking and prove to be very popular. We have assessor and transactional data on 60-70m homes in our database which we expose enabling home owners to monitor local values and transactions. Our heatmaps offer a compelling tool to visualize real estate trends and our community section, Trulia Voices (in my biased opinion) is the most useful consumer community based real estate research tool on the web. We’re continuing to invest in all these newer products in 2008 to scale them up. Keep your eye on in 2008 for lots more innovation!

    Wishing everyone in the a very happy holidays. Sleep and eat well and rest for what is going to be a very exciting 2008!!


  7. Pete: Thanks a bunch for the compliments and I definitely look forward to watching Trulia innovate in 2008! From all the research I’ve seen I’d have to completely agree with you that a great listing tool is the place to focus.

    Best wishes this holiday season!

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