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Google will Eat Multifamily ILSes’ Lunch! (New Series: Part 1 of 5)

Google will Eat Multifamily ILSes’ Lunch! (New Series: Part 1 of 5)

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Google is Starting to Organize Multifamily Data. That Should Scare the ILSes.

Google’s vision is to: “Organize the world’s information and make it universally accessible and useful.”

As Google absorbs and organizes information in different industries, it eats into the revenues of those ecosystems. It has done this in the past.

  • It absorbed and organized the data for the restaurant industry. Victim: Yelp.
  • It absorbed and organized the data for the hotel industry. Victims: Expedia & Priceline.

Now, Google is absorbing and organizing the data for the multifamily industry. Multifamily ILSes (Internet Listing Services) such as Apartments.com and Rent.com are squarely in their cross-hairs.

 

 

Why Should Multifamily Care?

It should not stretch anyone’s imagination to see that prospects will start using Google as their primary platform for apartment searches.

 

Result: Fewer leads from ILSes, more leads from Google.

 

How are you preparing for this change? In this 5-part post on Apartment Knowledge Graphs, we will give you the tools to understand and prepare for it.

 

Let’s start with a little trip down memory lane.

 

Google vs Online Travel Agencies

How did Google disrupt the travel industry? The formula is simple:

  • First, as promised in its vision, Google organized data for the Hotel industry.
  • Second, it made the data useful by ensuring users got all the answers they needed without leaving Google Maps or Google Search Pages.
  • Third, the attached ads to those search results started cutting into the online travel agencies’ (OTA) revenues.

Here are the results:

  • In 2016, the revenues of the largest player in the OTA industry, “Priceline Group” (now called “Booking Holdings”), was $10.7 billion.
  • Google’s travel division has caught up fast and is estimated to have revenues of $14 billion in 2017.

In our next article we’ll explore Knowledge Graphs to understand how Google is taking advantage of industry data to grab revenues in ways you’d least expect!

To catch the next article in this series, make sure you subscribe, below!

 

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marketing strategy marketing your apartments online marketing tip marketing data Apartment Marketing

About the author

Munish Gandhi

Munish Gandhi

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Munish is the Founder & CEO of Hyly.AI. Hyly.AI makes multifamily marketing & operations autonomous using a digital workforce that augments the human workforce. It automates repetitive processes, adds intelligence, and guides agent and marketer workflows. This frees your team to do what they do best - cultivate relationships! Hyly.AI believes a 'Humans + Machines’ strategy maximizes human potential, pushes machines to be the most useful, and delivers the best service to customers. And, it fundamentally changes the economics of property management companies.
 
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Coming from hotels to multifamily, I'm picking up what you're putting down, It's inevitable

  Evan Hoffmann
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Hi Evan: Interesting that you were in hotels and see this as inevitable. Would be curious to hear how you saw folks reacting to Google's entry? Were the glad to see the influence of travel agencies go down a little? Or, scared?

In any case, history does have a pattern of repeating itself. So, we are here to watch and see as it unfolds.

  Munish Gandhi
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Hi Munish,
It's interesting but the OTA's were caught as off-guard as the ILS' appear to be today. At the end of the day, "brick & mortar" travel agents with IATA numbers shrank drastically, with the exception of those with niche/group/international clients, while the OTA's saw their slice diminish. Some of the larger players in multifamily are seeing a trend whereby their marketing dollars are starting to be re-evaluated or earmarked from ILS spend to Web Directory players, such as Google.

  Evan Hoffmann
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Hi Evan: It seems you have a sense of déjà vu as you see all this being played out all over again :-)

I do see Multifamily go the same route, though it may take some time. But, like you said, the proof is going to be in the marketing dollar shift from ILS to Web Directories.

  Munish Gandhi
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I'm curious to see your subsequent articles on this topic, Munish. As a long time member of the ILS community for much of my career, the one big difference I see is that the search for an apartment home is of greater significance with longer impact and deeper spend than a hotel room or dinner out - therefore, consumers desire more comprehensive information and a format that supplies them the same type of info across a breadth of choices. I'm not saying I don't think Google can accomplish this, but I do think it's much more of a leap than the other industries you mention.

  Judy Bellack
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Thanks for your response, Judy.

Good point on the "longer impact + deeper spend" insight! Maybe that is the reason Google went for the hotel industry before the multifamily ILS business.

We recently posted the second article in the series: https://www.multifamilyinsiders.com/multifamily-blogs/google-s-secret-weapon-the-knowledge-graph-part-2-of-5 . If nothing, I hope you will see that Google is at least trying.

Would be eager to get your thoughts as we lay out our argument in more detail in the coming days and weeks.

  Munish Gandhi
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Looking forward to learning more about google expanding into multi-family.

  Kobie Giles
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This comment was minimized by the moderator on the site

Hi Kobie: Glad to hear that! The next article in the series is out: https://www.multifamilyinsiders.com/multifamily-blogs/google-s-secret-weapon-the-knowledge-graph-part-2-of-5

  Munish Gandhi
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