NYC REALTY CHECK - Zillow.com

Target Market

Zillow.com takes aim at buyers and sellers, renters and homeowners, brokers and other real estate professionals, harvesting an average of 8.2 million unique users monthly seeking “for sale” information, valuations and real estate advice.

The site scores points for seriousness and dedication to their informational mission and loses points for accuracy of that information. Whether you are visiting Zillow to see what your property might be worth in the marketplace or pricing a prospective purchase, keep in mind that the data is both culled from public records and submitted by owners, brokers and other interested parties. This leads to accurate information in some cases and misleading or surprisingly random approximations of reality in other cases.

Another audience for Zillow are prospective advertisers. The site unabashedly woos brokers and mortgage companies. The prominence of the mixed advertising and informational message muddles the credibility of the site, although the variety of clickable options may yet keep the visitor pushing through to their research objective.

The promotional pitch to buyers and sponsors is implicit in Zillows’s touting of its superiority over competitive sites, (“88% of our users do not visit Realtor.com"; "3/4x better click rate than Google”); year-over-year growth (19%); comprehensiveness (“4 million listings”); median household income of site visitors ($90,518); and iPhone App downloads (900,000).

Prospective mortgage company advertisers will be drawn to the claims that one million Zillow visitors are planning to purchase in the next month and they have an average credit score of 755. But to maintain that 55% of home buyers visit zillow.com before purchasing seems a bit of an imaginative calculus. And the statistic that 5.8 million Zillow visitors are planning to buy or sell their property in the next 1-2 years does not seem to be a sufficiently short term selling point to banks and brokers, even if it were a reliable metric.

Functionality

Zillow knows who its customers and users are and wants them to know who Zillow is. The range of clickables reflects that mission:

The seven home page banner tags are labeled Home, Mortgage, Advice, Directory, Local  Info, More and My Zillow. The heart of the functionality for the home researcher is the drop down Sale, Foreclosure, Open house, Rental, and Recent Sales categories. Before clicking the drop down, however, it is advisable to enter an address in the Find Homes address bar (any address in the chosen zip code will do). Otherwise, you are apt to be at a loss as to how to begin a search, since the home page is suffused with extraneous information about celebrity foreclosures (do you care that Wayne Newton is in foreclosure?), iPhone app updates, stats and graphs on the mortgage marketplace and homes for sale in Deruyter, New York (Where? Why? Did I ask for this information?).

Once the zip code is entered, however, the system will post more geographically relevant listings in your neighborhood and the fun begins. A Bing aerial map appears with the familiar fun options to zoom, scan and home in with a street overlay on the target property.

Below the map are the listings, sortable by price, size, living area, lot area or days on Zillow. The left border tower offers selectivity by price and size as well, but adds home type (single family, multi-family, condo, coop, etc) and selling type (broker, FSBO, foreclosure, new construction, open house).

The page layout and functionality work, but none of these listings services will be able to show all available properties. There are always properties your broker knows is coming on the market, houses the neighbors think might be for sale soon, or owners who believe their home valuation is inaccurately low or unrealistically high.

The directory tab for real estate agents could be useful if it were organized in some comprehensible fashion. If the prospective purchaser is looking for an agent in a designated locale he should be able to enter the zip code and immediately see an alphabetical listing of agents in the designated area. Whether the visitor is intending to browse for an agent or looking for a particular agent, the process is haphazard and frustrating.

Zillow is proud of its Home Value Index, but this is one of the less useful features of the site. It is simply too difficult to create systems which understand the market without experiential interpretation. The way to determine present value is by blending local knowledge of recent sales, current values, awareness of prospective buyer capabilities, and community conditions.

Verdict on functionality: It works, but if you are on site to suss the market, stick with the home search tabs. Other tabs lead to ad-influenced sequencing of agents and services which may be useful, but depart from an objective presentation.

Overall, don’t rely on Zillow, but start with Zillow.

Monetization

Zillow works from an ad revenue model. Sponsors are agents, brokers, owners, landlords, lenders and national advertisers. The ad environment is uncluttered, although presenting paid broker ads in classified listing format is always misleading to buyers and sellers seeking to select from the universe of available servicers.

Featured listings and Showcase listings tier the ad buy, and can be targeted for specific zip codes. E-mail newsletters and display ads offer additional revenue opportunities for Zillow.

The low barrier for access to property information (no subscription fees to search) enlarges the visitor base, which enhances the value to sponsors. Zillow has got their ad act together.

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-Everett Sherman

es2258@columbia.edu