From the Zillow Blog, we learn of their plans to launch an "open API" program later this year. For those of us less technically inclined, Application Programming Interface or API is the interface that a computer system, provides in order to allow requests by other computer programs, and/or to allow data to be exchanged between them (from Wikipedia).
From this definition, we can assume that an open API means that the program is open to any webmaster to include third party functionality on their domain, provided they know what they're doing. Google does it with Google maps, spawning the "mash-up revolution" blogged about last week. Will the Zillow API spawn a similar revolution?
I guess a significant problem for Zillow at the moment is credibility. Some suggest that Zillow's "Zestimates" are way off base, but since they're still in beta, it's probably slightly premature to be overly critical at this point, notwithstanding the near $60 million they've got in seed money. Nevertheless, they should be given the opportunity to work through the bugs, but with 60 mill in the bank, let's hope - for their sake - they work quickly before the money runs out. .
Why is Zillow doing this?
Their blog indicates they believe that real estate marketing is effectively niche and local and identify long tail as the new market distribution model. Zillow estimates that there are currently more than a million real estate websites in the U.S., with only a handful getting any significant attention:
it’s clear that buyers and sellers engage with real estate professionals on a local level. And it’s also clear that many individual agents may be looking to enhance their own sites with relevant and sticky content.
Zillow seems to feel that their content is
sticky, (although
Dustin appears to have a
different view), but what exactly is the long tail? And what is its relevance to real estate sales and marketing?
The Long Tail concept
The term - coined by
Wired's editor-in-chief
Chris Anderson in an
article he wrote in 2004 - essentially claims that:
products that are in low demand or have low sales volume can collectively make up a market share that rivals or exceeds the relatively few current bestsellers and blockbusters, if the store or distribution channel is large enough. Examples of such mega-stores include the online retailer Amazon.com, and the online video rental service Netflix. The Long Tail is a potential market and, as the examples illustrate, successfully tapping in to that long tail market is often enabled by the distribution and sales channel opportunities the Internet creates.
odotzero believes that:
... with the cost of technology and tools decreasing constantly, and the older generation of brokers retiring and moving on, I’m thinking the Long Tail will transform [commercial real estate] almost completely in several years. If you combine the Long Tail that exists among the brokers, and then combine that with the possibility that it is more valuable to do a lot of small deals than one huge one… hmm…. Plus… the Long Tail implies that there are smaller market niches that can be exploited somehow more effectively
he then provides a scenario of a broker who...
