Zillow Inc. (Z) is focusing on expanding on-the-go usage for StreetEasy.com, the New York City property-listings website it acquired in August, with plans to introduce a mobile application for more devices this year.
Zillow will relaunch StreetEasy for the iPhone and add apps for Android and iPads, Chief Executive Officer Spencer Rascoff said yesterday at an interview at Bloomberg LP’s headquarters in New York. About one-third of StreetEasy traffic is from mobile devices, less than the two-thirds share for the Seattle-based parent company, he said.
Zillow, which bought StreetEasy for $50 million and made the service free earlier this year, is seeking to boost the site’s mobile usage as a growing number of New York apartment hunters search for property information on their phones and other devices. The plan is in line with a broader strategy within the company to bring in mobile users, Rascoff said.
“We’re a software company, not a brokerage,” Rascoff said. “Our technology expertise is truly differentiated in mobile. It’s very, very difficult for a company that’s not a technology company to build great mobile apps.”
Zillow, the largest U.S. real estate website, has had the majority of its traffic come from mobile users for the past two years. In December 2011, five months after the company’s initial public offering, about 100 million homes were viewed on Zillow mobile. That increased to 275 million by last December.
A consumer who looks at a house listing on a mobile device is three times more likely to contact a real estate agent than a customer who browses on a desktop computer, Rascoff said yesterday. In 2013, 78 percent of Zillow’s $197.5 million in revenue came from its marketplace segment, which is mostly tied to fees that real estate agents pay to advertise on the website.
“The reason the mobile shift is so important to us is because of the way we monetize,” Rascoff said in the interview. “We’re more likely to have a monetization event, which is a customer connecting with a real estate agent.”
Zillow shares have more than quadrupled since the July 2011 IPO and surged 59 percent the 12 months through yesterday as the U.S. housing market rebounds after the worst crash since the Great Depression. Home prices increased 13.2 percent in the year through January, the S&P/Case-Shiller index of 20 cities showed this week.
Trulia Inc. (TRLA), a San Francisco-based competitor, has climbed 94 percent since its September 2012 IPO and rose 8.1 percent in the 12 months through yesterday.
Zillow has grown in part through acquisitions, buying companies including Mortech Inc. and Hotpads Inc. in the past 18 months. The company would consider more, Rascoff said.
“We’re always in acquisition mode,” he said.
The biggest purchase was StreetEasy, which had about 30 employees at the time of the deal. Zillow has added 25 to 30 staff members at the company’s office in New York, Rascoff said.
There have been departures. Michael Smith, StreetEasy’s founder, left his position as chief executive officer of the site in October and became chairman. Robin Allstadt, formerly chief operating officer, departed that same month. Sofia Song, who was head of research and communications, left in December after six years at StreetEasy and has since joined Urban Compass, a New York real estate technology and sales company.
Zillow operated a New York site that was 14 times smaller than StreetEasy when it made the acquisition, Rascoff said. The site was lagging behind in attracting mobile traffic before Zillow bought the company and the goal is to change that, said Susan Daimler, who took over as general manager of StreetEasy after previously serving as general manager of Zillow New York.
With taxis and subways adding wireless Internet service, StreetEasy is well-positioned to add mobile users once the new apps are released, Daimler said during the interview yesterday. Mobile traffic in New York increases on the weekends, and particularly on Sundays, when open houses in hot neighborhoods draw large crowds, she said.
“The mobile space is still very open here in Manhattan,” she said. “It’s a much more mobile place than when you’re driving around in cars.”
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