Yahoo Real Estate has entered into a partnership with what would seem to be one of its main competitors, Zillow.com. The keywords there being “seem to be”. This is because before the partnership Yahoo had focussed on selling ads from large mortgage and credit agencies, whereas Zillow was a listings (property portal) site through and through.
So, on the face of it Yahoo was a competitor but not in terms of their business models; they weren’t stealing any bread from each other’s tables if you like.
It must have suddenly (god knows why it took this long) occurred to Yahoo that not only were they missing out on a potentially lucrative side of their business, but that they were also letting many of their customers down.
Yahoo Real Estate itself admits this, in saying that there was tremendous demand to list properties on its real estate service, but that before now it was not serving these customers well on a “hyperlocal” advertising basis. In this statement they admit that they were missing out on revenues; by failing to advertise properties listed well on a localised basis they were not scoring any points with savvy agents looking to make the most of their advertising budgets, and letting customers down for the same reason.
“This partnership changes that,” says Steve Schultz, head of Yahoo’s real estate service.
Apparently, the partnership will be able to compete more closely with the market leading Realtor.com, owned by Move Inc. Realtor.com currently received 12 million visitors per month, pre partnership Yahoo Real Estate received 6.14 million and Zillow 7.05 million. This should give them a combined 13.19 million visitors, however, analysts believe there is a 10% overlap of their traffic, which means that combined the sites should receive just shy of the 12 million Realtor.com is host to.
That said: the 10% overlap is clearly only a guesstimate; it could be much higher or lower. This is especially true because of the fact that Zillow.com also has an overseas section, whereas Yahoo Real Estate is US only.
There is little denying that the partnership with Zillow.com will give those listing properties on Yahoo Real Estate access to a much wider audience than they have currently. This combined with the brand power of Yahoo could lead to the combination being able to mount a better challenge on the dominance of Realtor.com. Having said that, if the brand power of Yahoo was really an issue they wouldn’t need Zillow’s help to challenge anyone online — except Google of course. Time will tell.