Zillow Acquires ShowingTime for $500 Million: What Does it Mean for Consumers?
Collecting (Mining?) a Treasure Trove of Personal Data on Home Buyers and Sellers (and their Realtors)
[Note to Readers: The views expressed here are solely those of Ross Kaplan, and do not represent Edina Realty, Berkshire Hathaway (“Berkshire”), or any other entity referenced. Edina Realty is a subsidiary of Berkshire.]
To consumers and even many Realtors, the software that agents use to request home showings on their local MLS (“Multiple Listing Service”) is largely invisible.
Like the plumbing in a home, the only thing that really matters is that it simply and reliably works.
However, like a Nest thermostat (Google) or Alexa personal assistant (Amazon), showing software collects a veritable treasure trove of personal data — data that could at least theoretically be profitably “monetized.”
That includes personal information about home Buyers; when and what homes they’re viewing with their Realtors; and even which Realtors are doing the most showings — and in what area(s).
Calling Mark Zuckerberg
You hardly have to be Mark Zuckerberg or Jeff Bezos to imagine the potential marketing opportunities.
For example . . . how much do you think lenders would pay to know which Buyers just did a third showing on a “For Sale” home — and may very soon need a Pre-Approval Letter to submit with their offer?
Do you suppose moving companies, title insurers, home warranty companies and even furniture sellers might also like to know that information?
How about area Realtors, who want to list the Buyer’s home, assuming the Seller accepts their offer (and the Buyer’s agent hasn’t already secured the listing)?
Alternatively, imagine how valuable it would be to know which “For Sale” homes are never getting shown — and might soon be looking for new representation.
MLS Announcement
All of which is why this announcement by Northstar MLS yesterday no doubt sent tremors through the industry:
Zillow has announced that they will acquire ShowingTime.
ShowingTime and Infosparks (owned by ShowingTime) are NorthstarMLS core services. We understand the concerns, especially with regard to confidentiality of your data. Staff and our Board take this seriously and will monitor the ramifications of this sale closely. As always, NorthstarMLS will take any actions deemed necessary to further safeguard your data.
For now, please be assured that regardless of who owns the company, we have a binding contract with ShowingTime that strictly limits access to and use of your confidential information. ShowingTime also has a privacy policy with similar restrictions. Zillow is bound by both of these. NorthstarMLS and its Board will ensure that broker/client information remains private.
We will let you know when we have more information to share.”
–Northstar MLS message to Realtors (2/12/2021).
Privacy Concerns; Stock Market Reaction
At least for now, any concerns about consumer privacy appear to be premature.
And Northstar MLS’s announcement (above) clearly shows its sensitivity to the issue(s).
However, at least one audience is clearly excited about Zillow’s plans for ShowingTime (and future prospects generally): investors.
In the two days since the company’s announcement February 10, its stock shot up more than 20%.**
That translates into a cool $8 billion increase in Zillow’s market cap — not a bad return on a $500 million investment . . .
**Zillow also announced bullish quarterly and annual results that day.
See also, “Why Realtors Hate Zillow.”
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