Inman Connect San Francisco 2016
August 3, 2016, Emeryville, USA
Inman Connect San Francisco 2016
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Almost Everything We Need to Know Comes from Consumer Data
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It felt like a cat walk, the long walk out Madonna's pretty smart. Thank you. I'm going I'm taking a whole here at this point. Hi, great to have you. I'm a big fan of yours cause what I've noticed and I said it to a lot of people when you came in a year ago right anniversary. I just noticed a difference in the company not to mention the valuation is now almost seven billion dollars. So since you became CEO, I think they've added two or three billion. So I'm not sure that's the exact relation. You know, I've been at the company for 11 years. It was a year ago that I went from being a

Chief Marketing Officer to COO of the Zillow group. And it has been a really great year for all of us. So valuation up stocks up. Your earnings have been great. You're out from under this ugly lawsuit, that must be liberating. Yeah, you know it as a company we were really focused on growing the business growing our audience during our products for Premier agents. It was important for us as leadership team to keep our teams focused on that and you can see from the results that you know, we've grown it throughout it. But you know as you become bigger and become

a bigger brand certainly companies become more targets for things like that so you can from the consumer side, but now you're showing up at places like this which were very grateful for another face of the company. It seems also to me and I know if my people agree but you seem to be coming through the worst part of of people being matted Zillow in the industry as I guess you develop more fans. They're making money off you and I don't know. What is it. How do you feel about I still spend most of my time on the consumer and I have since the very beginning and as a

company Philosophy, we've always felt that if we know the consumer really really well. Anyone if we can do the research and understand home buyers and sellers and homeowners and build great products that we love other things as a business every time will will fall into place. So my role is GMO in a c o l is largely to focus on the consumer. I also spent a lot of time looking inward in focusing on our people. We're getting close to 3,000 employees now across at nine nine different location. So we spent a lot of time on hiring and retention with a with the best people and I get the luxury of

showing up at these once in a while which is always fun, but I still spend most of my time. So the other thing it seems to be happening to the trend out here and if you know all these startups, they're all trying to help you all figure out how to convert these hundreds of millions, whatever the Staggering number of a disconnect for all of us a hundred million people come into Zillow, but only 5 million transaction. So there's something there's a disconnect. It looks like a lot of people out here and they all are Cars are working on that. How do you think about that? How do you

describe everyone's looking at you everyday, but at some point the people are paying you which is another type of customer you have is not just the consumer. Are you figuring that out? Because it's interesting. Yes. There are a finite number of homes sold every year but there are many many more people who are thinking or dreaming about buying a home as a consumer-oriented company is to be the place that people start their home search and we want them to start their home search on Zillow or Trulia and sometimes that's starting process is many years before

it's when there are renter and they're thinking about can I afford to buy a questions that people ask for months and years before they actually pick up the phone and call a real estate agent and say help me through this. So our goal is to have people using our brand before they're ready to buy a home. Can you see that then in the numbers of 100 + million people who you are? And so we threw that out the window and she promised me that you'd bring 5 data sets and insights that hadn't been ever shared before and some country in which I thought was

fantastic dive into those with with the first year as a pretty Monumental year. We've been through this huge housing recession the largest housing recession of our lifetimes home values have roared back. It is a really competitive market in many places across the country. We got to pull factor of Millennials and we said, you know home buyers sellers there different now than there used to be. Let's do some really deep research to understand how and where they're different. So we did with the

largest study ever done in the last couple months of the America. Pussy Mart we talked to 13000 us home buyers and sellers renters homeowners and we asked them a series of 160 different question than they did and I didn't call me and Report the message came through and I still find them pretty contrarian. So too expensive for first-time home buyers. We hear this a lot in San Francisco home prices have gone up substantially. We got a lot of Millennials and

people that are strapped with college loan debt and we here all the time the market too expensive for her first time buyers. Today in 2016 53% more than half of all buyers. This year are buying for the first time. I think that was a normal Market someone who's smarter than me with the stats from the past, but I think if half were first-time buyers you started craving that energy for the move upmarket, so that sounds pretty normal. Totally it's just not something you here because they're actually buying it's

not that they're thinking about Berrien homes despite being more expensive than they've been in recent years there more affordable than they've been in decades because of the exceptionally low mortgage rates we have right now to the average homeowner today spend 15% of their income on their mortgage 30 years ago in the 80s to buy a home today based on their income. Now, the one thing I want to point out here though, 53% of people are first-time buyers, that means 53% of buyers today has never work for the real estate agent before and this is massively then changing. The way buyers are

finding a real estate agent. Buyers find a real estate agent the time. Yes. But I wouldn't say not for long. So what you're looking at here the blue bars are what buyers said how they found the real estate in the last year. The green bars are what's teller said so 32% of buyers found a real estate agent be a personal referral but 28% found the real estate agent online sellers. It's almost even across-the-board 23% of sellers found the real estate agency in a referral 21% found them online more than half of

today are far more than half. The buyers are first time they don't have any experience with a real estate agent before many of them are moving to a new place. So they're searching things like online reviews looking online to find the comfortable searching on the internet less likely to use referrals. They are buying houses the myth is and they're finding it to places like Zillow is opposed to referral so I have it right Still many people find their agents are referral.

But that online component is really catching up and I went better for sitting here a few years from now. We're going to see that surpassed personal agency or ignore. What are they get in the flow that Commerce your profile online. Even if you were still getting today most of your business through personal referrals, make sure that online profile is where it should be asked your current and former clients to review you online because the other 57% of these buyer said they have they have read online reviews before choosing her agent. Even

if it's a personal referral they're going to search out that person and say what if people read the profiles and that has the best consumer experience is to be able to find more information online more reviews more information about agents and home. And so we wouldn't want to ever do anything that would limit the amount of information. Okay, the home-buying season begins in the spring and buyers spend an average of 10 weeks shopping for a home. This is his number of places. But the big thing here is we

all think about the seasonality of real estate buyers and sellers come out in the spring it Peaks at some point in early summer. It dies down right about now in August in the kids go back to school. Now. This is true as far as transaction. But remember home shopping the real shopping here for a buyer begins long before they ever pick up the phone and call a real estate agent. So what I look at is I look at activity on Zillow and Trulia and threes in New York. And when do the buyers come back in math? And this is where it's pretty interesting.

And I'm not kidding you a big day today Christmas day, maybe a new laptop. What's the first thing you do when you get your new iPhone you go search out ass. It is our single biggest week for app downloads in that week between Christmas and New Year's and so for ages, I mean a lot of people take the month of December off its the slowest months of the year, but that's actually the month when you can be both during your online profile when you should be asking for reviews when you should stay when this influx of buyers comes on

Christmas day in building up in the January. That's when you actually want to be out there vs. After the Super Bowl thing about the home-buying seasons are these people that work 24/7 364 days a year and I have to work Christmas Day. God that was the one day they take off. Yeah. I mean it Rush are millennials everyone loves to talk about Millennials. They are a small fraction of homebuyers. They are these kids that can't afford to buy a home. Anyway, they're strapped with college debt. And by the way, they like to rent everything. Is that true? So we do know that Millennials

love to rent right Millennials don't want to own a car. They'd rather rent one when they need them. They don't want to go spend $400 on a new dress that use Rent the Runway. They don't own CD their own music on iTunes. They rent it, right so you would think then that Millennials also only want to rent home. So we asked about what do you think about home ownership? So what you're looking at here is we asked people for their attitudes on home ownership in the different bars are the different age groups. So the green bar is Millennials age 18 to 34.

It goes up by age to the light blue bar is people 65 and older. Do you agree with this statement owning a home is necessary for a good life highest category Millennials. I need to own a home to be respected in society highest category of Millennials millennials. Owning a home is the best long-term Investments received very American Dream here. Millennials really want to own homes. They want to this American dream. Can they are they will they are this is where the data we saw this year a massively varies from

data over the last decade in 2016. The average home buyer is 36 years old and in fact more than half 53% of home buyers today are so this is where your first time buyers are coming from who have never worked with a real estate agent before and Millennials spend all of their lives on their phone. Okay. So they're searching for real estate on the phone. They're finding a real estate agent on the phone. They're looking at listings and you know what they're doing, you know the phone experience. This is how you look at things what happens if the photos are

fuzzy if they have a weird Watermark if there's only three of them Move on to the next one. Some people are making split-second decisions driven by the fact of the technology they use and whether or not you know, we may think so Millennials are our buyers audience today and it's only going to get so they're part of the mainstream to no longer cool different and special things. I always have, you know, someone approached me and talked about the fact that on Zillow when you shop for a home we have both Nest to for sale by agent listing

and it's a small proportion because it is a small proportion of listings overall, but we have always chosen that to show buyers the most complete picture of the housing stuff. We put them side-by-side but in the survey where we talked to thousands and thousands and buyers this year. We wanted to understand if seen a fizbo as a theory goes if seeing if his phone doesn't Dr. Buyers to not work with a real estate agent and so we ask them did you shop on Zillow? And if you did did you work with a real estate agent? This was one of the results

at that I would say the result was bigger than I even imagined it to be we found it buyer's using Zillow where they stopped as bows and for sale by agents side-by-side. We're actually 32% more likely to work with an agent. What is pretty pictures? most most Buyers work with a real estate agent saying it's helping buyers to find a more complete picture of the housing market and what I hear from agents who tend to spend a lot of time on Zillow is the Bose because they can reach out to those Sellers and they can say something like hey, I noticed your home's been on the market for 6 weeks.

It's not moving. I know this neighborhood. I can help you. It's a great introduction ground a potential client. So the myth hear that buyers seen Fizz bows and someday in some way drives them to not work with an agent is just not true. Thank you for all that. You've never told anybody. Come on something anything. I mean, I can't take this is actually going to be a pretty massive research report that we're going to send out everybody will be available for everyone to have a

substantially change the way you think about interacting with consumers based on who they are. Today is hubris. How do you control Hubris in a company this seems to be killing at every turn so much of my time internally on the people in one thing. We've always enjoy that deliver but who really have an amazing culture. I've been with the company since we are about a dozen people 11 years ago. I've spent a lot of my own personal time thinking deeply about culture. How do we make this a

great place to work a great place where we can hire and retain people and as you get bigger and as your brand becomes more successful, it's really really important for Organization of any size to look Inward and say are we the people we want to be that we've set out to be are we hiring people that align with that and really be strict on how we Define culture and how we define success which is internally hiring the best people to do the best thing I've ever done in my career. And the reason is when you settle the lawsuit our page views went down and so it's hurt

our business. So it feels like in strain of trade.

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