As I’m sure you all have heard by now, Google has decided to beat a hasty retreat from real estate:
In part due to low usage, the proliferation of excellent property-search tools on real estate websites, and the infrastructure challenge posed by the impending retirement of the Google Base API (used by listing providers to submit listings), we’ve decided to discontinue the real estate feature within Google Maps on February 10, 2011.
That ain’t a lot of time to announce a pullback, so… either this decision has been brewing for a long time, or a new executive team somewhere in the Google hierarchy has decided to prune and trim all over the place.
Given that I’m one of those who thought Google’s Real Estate Place Pages was a big story, I suppose this retrenchment requires rethinking things. But I don’t know how much it changes things, really.
Speculation Back Then
I’ve never bought into the fear that Google would somehow one day replace the MLS and become the national source for property data. I did think that Google could bypass all consumer-facing websites, and wrote about three possible scenarios:
One, this real estate search as well as the listing details page is limited to the maps.google.com search, and consumers tend to be lazy and just do the search on the main Google site. Google does not do to real estate listings what it already does to photos and videos by pushing them near the top of the search results on the main search page. Existing real estate sites survive and thrive, as they have until now, as not much has changed.
Two, Google starts to push listings right onto the main page when a user searches for “homes for sale new jersey”, thereby bringing users right to the maps.google.com Real Estate Search module. Consumers are trained over time to do real estate searches on maps.google.com, as we have been trained to do searches for driving directions or restaurants or whatever on Google Maps. This raises the value of Google Maps immensely, but pretty much kills the existing real estate vertical search engines.
Three, Google keeps the real estate search only on maps.google.com, but consumers come to realize over time that they can find listings for homes right on that wonderful page and start to migrate over. This will also kill existing real estate vertical search engines, but over a longer period of time, which may be enough for the Trulias and Zillows of the world to reformulate their strategy or add far more features and functionality to add value to the real estate search experience.
Well, apparently, Google chose Option One. And found out that yes, consumers are indeed lazy and were not trained to go over to maps.google.com to look for homes.
I had a feeling that Google wasn’t really putting in a lot of energy into the real estate space. Were it important for Google to become a real player, I think we would have seen more energy out of them at various conferences, or participating in some of the conversations online, or doing something to suggest that they took the vertical seriously.
I have no idea what actually happened, but I suspect some combination of consumer apathy, broker opposition (would you be paying for Google AdWords if you thought your listing data was going to create a competitor you could never take down?), and changed priorities (Google appears to be all about mobile and Groupon these days) likely led to this decision.
The clearest implication is that Google is more than willing to let the real estate web companies fight it out amongst themselves for dominance, especially since such fights put money in Google’s pockets via advertising. Now that franchises can index IDX listings, and Coldwell Banker was specifically mentioned by Google in its post, I expect that we’ll see some truly fierce competition between the so-called national real estate portals and the national franchises for top dog in the real estate web game in 2011.
(As a related aside, there was much speculation in 2010 that Google would acquire Trulia to make a real push into the real estate vertical. That is probably not going to happen after this retreat. As a result, I would put Trulia on the RE Deadpool Watchlist as it falls to #5 on the Hitwise Top 20 Real Estate Websites.)
I do think it’s worth pointing out that you could draw the wrong conclusion from Google’s move here. My good friend Todd Carpenter, usually so insightful in all things web and real estate, gets this one wrong when he writes:
I think the low usage part is telling in that it suggests that SEO is not the total solution for winning the real estate game. After all, they control those results. Most people aren’t thinking to go to Google to look for listings.
Based on both secondary research, and primary research (I conducted focus groups with real estate consumers and watched how they look for properties), I think most people are in fact thinking to go to Google to look for listings. Just because Google implemented its program in a strange, bass-ackward way, and put no effort into actually making something happen in real estate does not mean that consumers skip over Google. Far from it. As of today, anyhow, SEO still remains the single most important factor for success in the buyer lead generation game, period. Maybe one day, social search, or Twitter, or something else will take its place, but not right now. Lose the SEO game, and you’re pretty much toast.
I think all that the low usage part suggests, actually, is that consumers don’t like map-based searches. I wish I had access to some internal stats of websites that offer the standard search vs. map-based search to see how the metrics break down, but I really don’t think consumers like map-based search all that much. I think they just want to find listings quickly, start clicking through pictures, and then call someone to help them. If you got some of those metrics, please feel free to share them in comments. 🙂
So at the end of the day, not much has changed because of this decision by Google. It appears as if they’re not going to come back into these shark infested waters anytime soon either, so Google will likely be an important passive player rather than an active participant in the real estate web game. Which is just fine by most of us in the industry.
Oh yeah, by the way, can we now stop the wishful thinking on the part of some people that Google will create a national MLS to replace the dysfunctional state of the real estate nation? We must save ourselves, lads, since Brave Sir Google will not be riding to our rescue.