,
7 tweets,
3 min read
Read on Twitter
Zillow is at a huge biz model disadvantage not controlling its own MLS. Having exclusive, vertical access to MLS data=dominant share+>margins in Australia/UK. Z needs to create its own supply that doesnt overlap w MLS. Offers creates new controlled supply.
As a business model analogy, Zillow is trying to do to the existing RE market (anchored around local MLS) what Netflix did to the cable bundle.
inman.com/2014/09/30/rup…
inman.com/2014/09/30/rup…
Unbundling the prevailing revenue model by creating the best content available (in Z's case, the "Glengarry" leads that did not previously exist) and vertically integrating yourself in a market where all of the existing supply seemed to be controlled
and if they do this right, Zillow's CAC for developing this controlled content of home supply is either $0 or actually a negative expense
Netflix's key strength was its direct access to consumer viewing data. Likewise, Zillow has the best data available re consumer purchase intent. Netflix couldnt fully benefit from its user intent data until it could directly control supply offered. Maybe the same applies to Z.
Zillow Offers model also supported by "barriers to entry are low, but barriers to scale are immense." If Z can turn low barrier to entry, low capital intensity model (ie RE brokerage) into 1 that requires high levels of capital to win... can extract more of existing profit pool.
Putting some math around the incremental revenue opportunity Zillow has from selling leads associated w Offers mikedp.com/articles/2018/…
