Late last month, News Corp announced that Move is acquiring Opcity, which was founded in 2015, for $210 million.
Move claims that the acquisition will bolster Realtor.com’s lead generation capabilities, allowing real estate agents to choose between “traditional lead products that offer professionals the opportunity to work leads themselves” or a “concierge-based model that provides highly vetted, transaction-ready leads” that will be delivered using Opcity’s technology.
But how much do real estate agents need to pay for leads, considering the game is changing so much?
In Mike Delprete’s latest Adventures in Real Estate Tech blog, he breaks it down.
But first of all he explains why the Move move is such a big deal: “With this acquisition, realtor.com dives deeper into the lead conversion funnel in a major way. Opcity features a referral fee business model where customers are worth 36x more than a lead — which highlights why the U.S. portals are diving deeper into the funnel.”
These real estate advertisements are a big business and Move is trying to keep up with recent advances in the service over at Zillow.
“In Zillow’s last earnings update, it shared its goal of "moving beyond lead generation and actively evolving toward being a deeper funnel real estate industry partner.” It launched a new, super-charged concierge service where Zillow sales reps qualify leads before matching them with a premier agent,” Delprete writes.
With the average Zillow lead costing anywhere from $20 to $220, Delprete puts the average spend at around $55.
One real estate agent I spoke to estimates he spends around $10,000 per year on both his Zillow and Move leads.
In terms of the strategic implications of the Opcity purchase, Delprete concludes the following: “Lead conversion is important! Small teams can't compete, but the larger platform plays (Keller Williams, Compass, etc) can absolutely build products (technology + people) that improve lead conversion at scale. But are they?”
Yes, they are.
Just last week, Keller Williams announced it was teaming up with this AI firm to tap new data trove.
So lead conversion can’t be far behind. Let’s just hope, that with more competition, real estate agents will be able to access higher quality leads at a lower cost.