And the Lead Goes Round and Round

by Victor Lund on September 23, 2014

ListingSyndicationsmallI had a rather interesting conversation about lead management and lead sales today. The story went something like this.

A broker enhances listings and purchases zip code leads from a portal. The broker believes that there is some form of exclusivity on the leads generated through the system in so far as the lead is only distributed once. In his case, he distributes the leads as they come in to one of his agents.

To test the system, the broker had a staff member go to the publisher site and generate a lead. The lead came through to the broker as promised. However, the broker (pretending to be a consumer) also got a call from a mortgage company to pre-qualify for a loan. During the call with the loan officer, they suggested that he work with one of the mortgage company’s network of agents and asked if he needed help finding an agent.

To the broker, that caused the lead to be “sold” twice. He was rather upset.

The portal takes the lead that they provided to the real estate agent and also sells that lead to the mortgage company. In this case, the mortgage company also has a lead network where they take leads that they generate for mortgage and provide that lead to a real estate agent partner. So the same consumer lead went to the publisher’s broker partner and the mortgage company’s broker partner – one lead just became 3 – 1 to the publishers premium broker; one to the mortgage company (unbeknownst to the premium broker); and again to the mortgage company’s real estate agent network. Poor consumer gets hit 3 times just for asking if the fireplace is wood burning or gas.

I do not see that the portal sold the lead twice – so in my opinion, the portal is not undermining their product sold to the brokerage. But they may be conspicuous if they are not telling the premium brokerage that they are selling the lead to other home services companies like the mortgage firm. The publisher probably just said that they only sell the lead to one real estate broker/agent.

In 2009, WAV Group did an analysis of the “fine print of listing syndication.” The paper can be viewed here http://waves.wavgroup.com/2009/11/10/listing-syndication-be-sure-to-read-the-fine-print/.

The take away is that, unless you have a well crafted agreement with a publisher, all of your content – listings and agent information, and clearly the consumer information they collect – all belongs to the publisher.  Don’t be fooled by agreeing to a click though agreement when you register your account or purchase a premium product on the portal itself.

The lead you are buying from portals is more of a lead service than an actual piece of intellectual property. I am not a lawyer; so don’t take this as legal advice. This is just what I am licking off the grass. You get a copy of the lead, and perhaps the only copy for your category (ie real estate broker) – but the publisher continues to own the customer record and can repurpose that customer record by selling it to another category of customer like a mortgage company or insurance company or whomever.

When you begin to work with a vendor on any service, you need to take a careful look at data licensing and the rights associated with using the data. For example, can your CRM vendor turn around and sell your contact records to a third party? Can an IDX vendor use the agent contact information contained in the RETS feed to market products and services to agents in the roster without your consent? Can you CMA vendor resell your data?

Unless the use of the data is carefully restricted, it can be repurposed for all kinds of things – most of which the real estate broker never sees

Data is your asset – be sure to protect it and take the time to have a lawyer review your contracts.

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