When a real estate brokerage is almost completely virtual and at least partially owned by its agents, the pressure’s on for any tech company that commits to power its lead generation.
That’s especially true when the brokerage aspires to remain relevant to agents in the face of competition from third-party portals, such as Zillow and realtor.com.
Real estate marketing software company Commissions Inc. (CINC) has taken up the challenge.
The firm has signed a deal with eXp Realty to become the primary lead generation and customer relationship management (CRM) platform for the brokerage’s 1,800 agents in more than 40 U.S. states and Canada.
What will eXp agents get out of the deal?
EXp agents pay the cloud-based brokerage a monthly technology fee of $50.
As part of the deal with Commissions Inc., all eXp agents will receive — at no additional cost — a consumer-facing website that integrates with local MLS data, a comprehensive CRM platform to manage clients from lead to close, and three mobile apps: CINC Agent App, Houses.net, and Open Houses by CINC, according to a press release.
Screen shot of Commissions Inc. Agent App
“As third party portals continue to proliferate, we believe that providing a fully integrated CRM and IDX-based consumer search experience, the ability for agents to easily feature their own listings on their websites and the ability to promote themselves as part of a custom ‘portal strategy’ is an essential part of our vision as a leading technology-based brokerage,” said eXp Realty CEO Jason Gesing in a statement.
Jason Gesing
The brokerage belongs to and receives IDX (internet data exchange) feeds from more than 100 MLSs across the country, Russ Cofano, president and general counsel of eXp World Holdings, told Inman via email.
“Very few brokerage companies have this type of reach,” he said.
“This reach provides us with the ability to offer consumers a national search experience while giving our agents the opportunity to leverage that traffic through individual IDX websites at the local level.”
Competition from third-party portals a ‘real threat’
Third-party sites appeared to be a concern for the brokerage’s parent company, eXp World Holdings, in its latest quarterly report.
“The relevancy of a brokerage in the face of a significant percentage of lead generation for the agents who work for the firm being generated through third-party portals does raise the question of relevancy to the agents that work for the brand,” the company wrote.
“We see this as a real threat to us as a real estate brokerage and we are proactively developing low-cost lead generation platforms that our agents can take advantage of, which provide significant cost savings versus going through third-party syndicators.”
Generating leads at lower costs
EXp warned that it is “relatively easy” for the brokerage to generate leads at a lower cost than the portals now, but it may become harder to do as the company grows.
The company noted that agents participating in its “Making It Rain” lead generation program have seen costs of between $7 and $40 per lead.
Agents pay a minimum of $100 per month to join the program.
“Leads may become more expensive over time and in some cases may exceed the cost of leads from other third-party syndicators,” the company wrote in the June 30 quarterly report.
“So we need to be aware of this and continually innovate on behalf of our agents and brokers again with the goal of being relevant in their business.”
“If agents believe that their business is generated from third-party syndicators then it may follow that agents may pursue the lowest expense brokerage in order to maximize their income.”
[Tweet “eXp Realty: We see third-party portals as a real threat to us as a brokerage”]
EXp has not yet determined whether and to what extent the CINC platform will be used to enhance the Making It Rain program, Cofano said.
Commissions Inc. doubles its customers
The CINC platform is set to go live for eXp agents and brokers in early 2017. The brokerage is CINC’s first enterprise client.
The deal comes on the heels of CINC’s acquisition by Fidelity National Financial Inc. over the summer.
At the time, CINC claimed more than 1,500 customers, so this deal will more than double that figure.
“eXp, with its extremely rapid growth and agent-focused values, is the perfect opportunity to get CINC in the hands of the right agents, knowing they are already part of a family geared for success,” said Alvaro Erize, COO of CINC, in a statement.
Screen shot of Commissions Inc. Agent App
CINC will replace Kunversion as eXp Realty’s primary, long-term lead generation and CRM software provider, though eXp will continue to offer Kunversion to agents that might prefer that platform, Cofano said. Kunversion partnered with eXp two years ago.
When asked why Kunversion was set aside as eXp’s primary provider, Cofano said, “We chose CINC because we believe they have a great platform and they share the same values and philosophy that we have regarding delivering mission critical lead-gen and CRM tools to agents, both now and in the future.”
What ‘agent-owned’ means
Launched in October 2009, eXp Realty became profitable for the first time in 2014.
The company describes itself as “a full-service real estate brokerage providing 24/7 access to collaborative tools, training, and socialization for real estate brokers and agents through its 3-D, fully-immersive, cloud office environment.”
Instead of royalty or franchise fees, agents pay 20 percent of their gross commissions, up to a maximum of $16,000 for agents who have been with the company for at least a year.
Russ Cofano
Agents can earn residuals on gross commission income generated by agents and brokers whom they recruit to the company.
“This residual is based on actual revenue versus the profit sharing that some other companies employ,” Cofano said.
Qualifying agents are eligible for awards of company common stock when they hit production and agent recruiting goals, according to an “Agent Ownership” initiative announced in 2014.
On September 21, eXp World Holdings appointed Cofano as its president and general counsel. The company first hired Cofano in July as its chief strategy officer and general counsel. Cofano replaced Gesing as president.
Like me on Facebook! | Follow me on Twitter!
