Here is a great article about how social media has largely failed to penetrate the financial sector. Makes total sense. It’s extremely hard for industries that rely on professionals maintaining a competitive edge by preserving their own data, strategies and content to build a platform based on social interaction. Will the real estate industry be any different?
Some would obviously point to LinkedIn and suggest that the industry has already embraced social media. Or Twitter for that matter as well.
I would argue the opposite.
Take a look at the traction LinkedIn has for instance. The largest social groups are:
Social Media Commercial Real Estate: 7,364 members
Social Media for Real Estate – 3,290 members
Social Media for Residential Real Estate – 3,007 members
The best guesstimate of the size of the commercial real estate industry is around 300,000 professionals, and the residential real estate industry around 1,000,000. It's therefore not that hard to see that, at least on LinkedIn, the percentage of actual engaged real estate professionals is extremely low. And I don’t count the number of professionals that consider being active by simply posting quotes from Steve Jobs or photos of attractive women (no shit, I see folks do that all the time) to be actually "social."
Will someone be able to figure this out and crack the commercial real estate social barrier?
One new site that might have a shot is RealConnex. The entire premise of their site is to build a secure network for commercial real estate professionals. Allowing professionals to interact with others in a secure and confidential manner could be successful.
I think Compstak has a shot too, based on their Premise of making leasing comps public but in an anonymous manner. All centered around the "sharing" concept.
If you look at the sites that are gaining traction, it's all about data and analytics. That's who will clearly be the first set of winners in the real estate tech industry. Tools that give professionals a competitive edge. And so it's no wonder that VTS, Hightower, Reonomy, Floored and CREATE are gaining market share. Same goes for the CRM's like REA and REthink.
And the crowdfunding startups like Realty Mogul and Fundrise are also clearly gaining traction. But again, they aren't social. The listing sites like 42Floors, thesquarefoot (and even Loopnet/Costar!) don't have a true social component. It's about data and information in real time.
So, back to social.
What about the bloggers you say? Well, I would argue that's really less about being social and more about thought leadership. Most of those that are blogging successfully are doing it without much conversation back and forth between the industry at large, but rather are doing it to build thought leadership for themselves. And it works! Just look at Jeremy, Coy, Duke, Barbi, Allen. Amazing content, but is it "social"? I would say they are as much the new media as anything! And that's a good thing in my mind.
And so will anyone be able to build THE FACEBOOK for commercial real estate? As long as the industry is dominated by "we eat what we kill" mentality and the concept of collaboration and sharing are alien to the way business is done, I say no. Or at least, it will take a long time and a lot of $ to change behavior in this field.