Home Sales are Down - But Realogy's Buying

Well, they're licensing anyway. Realogy® has licensed the use of the Better Homes and Gardens Real Estate® brand for 50 years, with an option to renew for another 50.

Since the goal of business expansion is more business and profits, it's obvious that Realogy management is bullish on real estate done the traditional way. Already holding Century 21®, Coldwell Banker®, ERA® and Coldwell Banker Commercial®, Realogy also holds a licensing agreement with Sotheby's International Realty®. It's obvious that Realogy and others believe that the large franchises hold an advantage in the Internet marketing arena, as well as the traditional strengths of franchise brands.

With Realtor.com® losing ground in Web listing viewer traffic, what might Realogy have in mind to compete with the Zillows of the Internet? Maybe they'll just buy Zillow. Or possibly Realogy believes that getting control of MOST of the listings will create a destination site that will lure visitors. But, it will never have ALL the listings, unless smaller independents and boutique brokerages just disappear.

The overhead and commission structures necessary to maintain these huge companies seem to rely on the status quo methods of brokering real estate. It would seem that they're betting on taking over Internet lead generation to a great extent. Traditionally, one of the strengths of these franchises was in leveraging marketing for the franchisees. There's little doubt that this is the master plan for the Web as well. And holding franchisees, along with their fees, will definitely require perceived value from online leads handed down from corporate.

Though the Internet has been an equalizer of sorts, with smaller players able to gain search engine visibility through SEO and/or Pay-per-Click, the deep franchise pockets could conceivably buy up the first pages of the search engines. The buzz out there is that blogs are the future for exposure, so perhaps well see some consolidation franchise blogs also. I'm sure they'll be better structured than the recent roll-out by Realtor.com®.