Webinar - non dues revenue Image

WEBINAR RECAP

WAV Group, RE Technology, and Zuora sponsored a webinar on the topic of non-dues revenue on February 15th, 2012. Panelists for the webinar included Jeremy Crawford of MLSListings.com, Melissa Olson of Metrolist Colorado, John Heithaus of Metropolitan Regional Information Systems, Kevin Green of Real Estate Digital, and Travis Hutch of Zuora. Victor Lund of WAV Group was the session moderator.

Overview

Associations and MLSs have been in the business of offering non-dues related products for some time now. They have sold yard signs, closing documents, certification training, and lock box products for years. The new horizon for non-dues revenue focuses around software products and advertising.

Generating non-dues revenue through advertising is simple. There are two channels for advertising revenue. Consumer-facing advertising on an MLS consumer-facing website or email notifications is the first channel. The second is business advertising to agents and brokers delivered through inside the MLS or tax system.

Software sales are more involved. The process of discovering and purchasing software in real estate is cumbersome to today’s professional. It’s archaic. But new MLS resources like RE Technology are changing that.

Today, agents and brokers can visit their MLS to learn about the products and companies that deliver solutions to help them sell more real estate. They can ask questions, see user ratings, and read reviews. However, the chief complaint is that there is no eCommerce.

Our experience with RE Technology over the past few years has taught us that the real estate industry is hungry for an app store. Your customers want to “click to buy.” The MLS is a natural place to deliver the app store for three reasons:

  • First, the MLS is already a trusted source, providing the most fundamental software services to the real estate professional.
  • Second, the MLS is convenient. Agents and brokers visit the MLS more than any other professional website on the Internet.
  • Third, the MLS knows technology. The MLS has proven that it can select and distribute software efficiently – reducing sales costs for software vendors and, in turn, reducing prices for its members.
Here are how some industry leaders are developing new thinking and new strategy.

Jeremy Crawford MLS Listings

MLSListings serves 8 Associations of REALTORSŸ.  Brokers comprise their Board of Directors. Their governance dictates that the Board of Directors only reviews Policy, not the activities of the MLS. Associations are service centers. By developing non-dues revenue strategies, MLSListings has made an impact on revenue that has offset operational costs.

The goal of their advertising program and software sales program is to reduce their dependence on dues. This has been driven by the loss of 8000 subscribers between 2007 and 2011.

Here are a few key facts about MLSListings:

  • MLSListings does not license products beyond core MLS services.
  • MLSListings uses the same three-party data license agreement for products that they offer.
  • 5% adoption of products is a decent goal for the first year.
  • The best-selling products are IDX and virtual tours.
  • MLSListings follows a strategy to limit the number of partnerships and create a number of exclusive or semi-exclusive vendor relationships.

MLSListings advises that an MLS should budget around $50,000 to launch an eCommerce platform and contemplate 100 staff hours for each product launched in the program. Their eCommerce solution is tied into Salesforce.com – a leading enterprise CRM solution that they have customized for their company.

MLSListings prepares their trainers and call center operators on handling support calls for each product, but requires vendors to provide support.

Revenue from advertising on MLSListings.com averages around $1 – $2 per thousand ads served. MLSListings is making their advertising network available to other MLSs who seek alternatives to today’s advertising offerings.

John Heithaus – CMO, MRIS

MRIS is launching phase two of their program later this spring or early summer. They call it “Gen M.” Gen M is focused around three modes of delivering services to the subscriber: Core Services, Premium Services, Freemium Services. With their non-dues revenue program, MRIS has been able to diversify revenue dependence on dues.

Many of the strategies of MLSListings are similar at MRIS. The key for MRIS is deep integration into the MLS system. As agents perform tasks, Premium solutions will be offered.

For example, an agent adding a new listing may be offered a virtual tour, or Imprev may dynamically generate a flyer that can be emailed or printed.

MRIS firmly believes that these programs are for the benefit of their agents, brokers and shareholders. Through these programs they effectively deliver better products at lower costs and expand their revenue diversity.

Melissa Olson, Metrolist CO

Metrolist manages about 65% of all listings in Colorado. Today, 15% of revenue comes from non-dues programs. Metrolist launched their store in November 8th, 2011. The program helpful at offsetting increases in the cost of delivering MLS services.

Metrolist’s strategy is to offer broad selection of products rather than limited or exclusive products. Metrolist also offers products to consumers and appraisers.

Metrolist believes that product offerings integrated into behavioral activities inside the MLS is the future.

Revenue sharing ranges from 5 to 50% on the 60 products they offer.

They separate marketplace purchases from MLS core services in their billing process.

Kevin Green, VP Sales, Real Estate Digital

Real Estate digital is working with 27 MLSs on some type of non-dues revenue program. They offer an advertising network, along with agent websites, IDX, CRM, document management, and other common agent and broker business solutions. By working with RED, MLSs are able to deepen their service levels and generate new revenue to offset increasing costs of operating the MLS.

Green believes that MLSs should be looking to diversify their strategies to blend dues revenue with revenue from premium services.

Travis Hutch, VP Sales Zuora

Mr. Hutch provided an overview of their services. They are the vendor of record for the shopping cart that MRIS and MLSListings are deploying. Zuora is leading provider solutions for integrating billing as a service into CRM. They are among the leading providers of billing in a box. It is an impressive solution.

RE Technology

RE Technology provides a free resource to MLSs looking to provide technology training and education to their subscribers. Today, more than 60 MLSs reaching about 700,000 subscribers have access to RE Technology. RE Technology recently launched the Success Store and Success Tracker. Success Store attaches to RE Technology to support eCommerce on products offered by MLSs. Success Tracker links RE Technology to eCommerce solutions outside of RE Technology for payment management.