Zillow Buys Follow Up Boss
Recent developments have sent ripples of concern through the real estate industry, particularly among real estate professionals who rely on customer relationship management (CRM) tool Follow Up Boss to streamline their operations. The acquisition of Follow Up Boss (FUB) by real estate giant Zillow has prompted questions about the intentions behind this move. There's a growing apprehension among realtors that Zillow may leverage the data from FUB to market directly to home buyers and sellers, potentially sidelining real estate agents in the process. This article aims to delve into some of the details of Zillow's recent aggressive behavior, its potential implications for real estate professionals, and an alternative CRM if you’re considering leaving FUB behind.
A Brief Overview of the Follow Up Acquisition
On November 1, 2023 Follow Up Boss announced it would be joining Zillow Group. Co-founder Dan Corkill says, "It feels like our entrepreneurial journey is coming full-circle." citing FUB's original 2011 launch as a solution for real estate teams and single agents who needed a system for managing leads purchased from many different providers, with Zillow being one of those providers. The goal is for FUB to remain an independent brand and a standalone product, with the same focus on support and community; just with more access to more resources and support. FUB promises very few changes, with the same customer-focused culture and exceptional level of customer support plus the added benefit of more and better features being added faster. Real estate professionals are assured that they will remain a valued FUB customer regardless of whether they use other Zillow Group products and services. Most critically: they promise that this integration is a one-way sync of Zillow Premier Agent leads into FUB, so the customer data you enter into the platform remains yours, protected, and never accessed, used, scraped, or sold.
Concerns Raised by Real Estate Professionals
FUB is a well-respected, bootstrapped company, and many are happy for their success in selling to Zillow. Others are disappointed in the sale because they believe there's a big misalignment between the two companies' long term goals and company cultures. Zillow, on the other hand, is considered by many to be a known danger to their businesses. They say the platform is malicious, it doesn't like agents, and that on multiple occasions since 2006, Zillow has demonstrated that it will say one thing and then turn around and do another, including selling your information back to you and they selling the same leads to multiple agents. Zillow claims it is only interested in selling leads but the fear of a takeover has been present since the 2010s, and for good reasons.
The Potential Use of Customer Data
Zillow already owns ShowingTime, the real estate industry's leading showing management and market stats technology provider, and real estate transaction management software Dotloop. The addition of Follow Up Boss, one of the top real estate CRMs, gives them more of your data.
Why does data matter? Because the more data you have, the more leverage you have, and the more leverage you have, the more money you can make. Within a year of acquiring Dotloop, the terms of its Privacy Policy were altered to create “Affiliate Sharing” allowing Dotloop to share information provided to them on or after January 1, 2016 with Zillow Group and its subsidiaries. ShowingTime doesn't include much non-agent data but Dotloop and FUB are full of customer data. In ShowingTime, if agents enter Sellers contact information so they get showing requests/notifications, Zillow will then have those addresses and contact info. It can take data from Showingtime, Dotloop, and now FUB and use that data to run targeted ads to your audience. In this way Zillow could take over with its mortgage division.
Security and customer data privacy are cited as top priorities for both Zillow Group and FUB, and both companies have robust processes to secure customer data. But in the world of technology "data security" doesn't mean data exclusivity, it simply means protecting digital information from unauthorized access, corruption or theft by unauthorized parties. That means Zillow can keep its promise to maintain data security from others but that doesn't necessarily prevent it from harvesting your data for itself.
Speculation on Direct Marketing to Home Buyers and Sellers
In Zillow's ideal scenario, all real estate transactions would be done via its digital platform because Zillow's best means for increasing its market share is by becoming the market. Many fear that Zillow will continue to insert itself into real estate transactions in an effort to make its platform the first place agents go to input home listings instead of traditional MLS systems. If Zillow successfully monopolizes all real estate data, it might end up charging significantly more for data access than multiple MLS organizations currently do. They want the data in your CRM, which includes all your clients and their data. Once they have that information, they can use your data (usage, where you get leads from, follow up, etc). to start bombarding your clients with advertisements that lure them into the Zillow sales funnel, sans you, the original professional who collected that information. Zillow is not known about being honest to their clients about their data, so data integrity and future use are rightfully a concern.
Some agents worry it's just a matter of time before agents' FUB contacts, organized as seller leads, start getting calls and emails from Zillow offering to introduce them to a local agent who's a 'personal guide' in their area. Others think Zillow will at some point launch a service where pre-qualified buyers can access Zillow listed homes without a realtor. Zillow could send the lockbox and use ShowingTime to schedule with a Zillow listed home. Zillow could pre-qualify the buyer with their lender and have enough information about them to confidently assure home sellers that they can trust the system. These concerned agents believe we'll see Zillow conducting more and more of the transaction instead of helping connect home buyers and sellers with qualified agents.
Potential Impact on Realtors' Income Generating Opportunities
Zillow's aggressive targets can be seen as a clear signal of intent. They continue to invest in their mortgage business and have been actively expanding their team of mortgage loan originators. They've introduced pricing changes that will likely affect agents and their preferred lenders. Zillow's dominance gives them tremendous pricing power to squeeze more revenue from real estate professionals and the commission pool, perhaps even compromising the traditional brokerage industry.
The potential consequences for realtors in the wake of Zillow's acquisition of FUB are substantial. One major concern is that Zillow might leverage the acquired customer data to market directly to home buyers and sellers, effectively cutting out real estate agents from the process. This could reduce the need for realtors and sideline their role, impacting their livelihoods and creating disadvantages for home buyers and home sellers. Increased competition from Zillow could also drive up marketing and advertising costs for real estate professionals, making it harder for smaller agencies and independent agents to compete effectively. This not only affects their bottom line but also reduces the options for clients, potentially leading to higher costs for home buyers and reduced opportunities for home sellers. In the absence of experienced realtors, home buyers and sellers may also be exposed to risks due to the complexity and magnitude of real estate transactions. The lack of professional guidance will doubtless result in unfavorable outcomes.
Parallels to Other Tech Giants’ Impacts on Small Businesses
The situation bears a striking resemblance to the challenges faced by small businesses when Amazon transformed the retail landscape, when smaller retailers struggled to compete with the e-commerce giant's vast resources and direct-to-consumer approach. Many did not survive. Likewise, in the wake of Expedia, Inc.'s rise to prominence, independent travel agents struggled to compete with the platform's extensive offerings, leading to reduced opportunities and eventually higher costs for consumers. In all three scenarios, the dominance of tech giants has far-reaching effects on industry professionals by leveraging digital platforms to provide customers with convenient, direct access and impacting the ability of single agents and brokerages to flourish and provide valuable services to clients.
Real estate professionals have every right to be concerned. Zillow's acquisition of FUB and its potential to use customer data to bypass real estate agents echoes the same approaches that helped Amazon undercut small retailers, and how Expedia's consolidation of travel services threatened the livelihood of independent travel agents. These transformations highlight the power of technology and data in reshaping industries, while raising concerns about the livelihoods of professionals who have traditionally played vital roles in facilitating transactions and providing expertise to consumers. This is effectively the same thing their founder, Rich Barton, previously did with travel agents when he founded Expedia and pushed thousands of travel agents out of business. Now, many fear he's planning to do the same to real estate agents.
Risks for Home Buyers and Sellers
Zillow's growing dominance in the real estate market and its potential exclusion of real estate agents can create substantial risks for home buyers and sellers, particularly those who lack experience with major property transactions. Real estate professionals play a pivotal role in safeguarding the interests of their clients throughout the buying or selling process. They provide valuable guidance, ensure that transactions are conducted ethically and legally, and help clients navigate complex negotiations. Without the support and advocacy of a realtor, inexperienced home buyers and sellers may find themselves at a disadvantage when it comes to negotiating terms, understanding contractual obligations, or identifying potential pitfalls. In the absence of professional advice, they could be more susceptible to making costly mistakes, such as overpaying for a property or facing unexpected issues post-transaction. Caring for clients is not only an ethical obligation but also a sound business practice for real estate professionals. They understand that their reputation and long-term success in the industry depend on providing exceptional service to clients, acting in their clients' best interests, and maintaining strong professional relationships.
In contrast, tech giants rely on their market dominance and sheer volume of clients to create short-term successes that benefit their shareholders. They are not obligated to care about the client's satisfaction and well-being when they are the only option available to them. This situation underscores the importance of preserving the role of real estate agents as a trusted advisor when it comes to protecting the best interests of all parties involved.
Our CRM Alternative
To safeguard your interests and maintain control over your business, consider exploring alternatives to Follow Up Boss. Our CRM is the ultimate solution for real estate agents looking to boost their productivity, seize opportunities, and stay competitive in the market. It's a game-changer that can help agents expand their business effectively.
Our CRM solution, coupled with IDX integration and backed by our dedicated support, provides real estate agents with a powerful tool to streamline their operations. It's essential for agents to have a dedicated online presence that acts as a digital "storefront" where they can showcase their personal brand and attract new leads. While there are common misconceptions about CRMs being expensive, having a steep learning curve, or primarily benefiting agents with extensive client lists, our CRM debunks these myths. It integrates effortlessly with IDX, eliminating data exchange restrictions, and providing advanced functionalities. Features like sharper automated email campaigns and lead scoring are just the tip of the iceberg.
Our CRM also simplifies marketing automation, ensuring that leads receive instant, personalized engagement through pre-designed follow-up campaigns. With lead pooling from various online services and on-the-go accessibility via our mobile agent app, lead management becomes hassle-free. Agents and brokerages even have the flexibility to integrate our CRM into their existing website or opt for a ready-to-use website that we personalize and launch in no time. This all-in-one solution is packed with features like pipeline visibility, task and calendar synchronization, custom content creation, and a steady flow of website traffic, all designed to boost productivity, maximize opportunities, and keep you competitive in the market. It's like having a personal assistant to help manage leads effectively and grow your business.
In Conclusion
The impact of Zillow's acquisition of Follow Up Boss raises serious concerns for the real estate industry and its professionals. The potential far-reaching consequences of its aggressive pursuit of customer data could reshape the landscape for realtors, limiting their income and challenging their livelihoods. For now, we can only hope that Zillow Group's track record of responsibly investing in the growth of its industry tools remains consistent. It's hard to guess exactly why Zillow would want to buy FUB. Zillow does like to be vertically integrated in the real estate space, as indicated by their other acquisitions, so acquiring FUB at least tracks with those other purchases. Having valid business considerations that substantiate their plan to acquire FUB may alleviate some concerns about any nefarious plans for the real estate data inside FUB but that doesn't automatically mean it's good for agents.