Introduction
Zillow is one of the most popular real estate websites in the world. Founded in 2006, Zillow has become the go-to resource for many people looking to buy or sell a house. With its expansive database of listings, helpful tools, and easy-to-use interface, it’s no wonder that Zillow has become so popular. But how does Zillow make money? This article will explore the various revenue streams that have helped Zillow become a real estate giant.
Exploring Zillow’s Revenue Streams
Zillow has several different revenue streams, all of which contribute to their success. Let’s take a closer look at each of them.
Advertising
One of Zillow’s primary sources of income is advertising. Zillow allows real estate agents and mortgage lenders to purchase ads on their website. These ads are targeted to users based on their search queries and other factors. According to Zillow’s 2019 annual report, “advertising and other revenue” accounted for 68% of their total revenue.
Subscription Services
In addition to their advertising revenue, Zillow also offers subscription services to real estate agents and mortgage lenders. These services allow agents and lenders to access additional features such as marketing tools and enhanced listing visibility. Subscription services account for 14% of Zillow’s total revenue.
Data Leveraging
Zillow also makes money by leveraging its vast database of real estate information. The company sells this data to third parties such as financial institutions, government agencies, and research firms. According to a 2018 study by the National Association of Realtors, Zillow’s data sales account for 8% of their total revenue.
Real Estate Brokerage Model
Zillow also operates a real estate brokerage model, in which they help buyers and sellers connect with one another. Zillow charges a commission fee when a sale is completed. This accounts for 6% of their total revenue.
Home Improvement Services
Zillow recently launched a home improvement service called Zillow Offers. This service allows homeowners to quickly and easily sell their homes to Zillow without having to go through the traditional real estate process. Homeowners receive an offer from Zillow and can choose to accept or reject it. If accepted, Zillow then takes care of any necessary repairs and resells the home. Zillow’s home improvement services account for 3% of their total revenue.
Acquisition Strategies
Finally, Zillow makes money through acquisitions. The company has acquired several other real estate-related companies over the years, including Trulia, StreetEasy, HotPads, and Naked Apartments. These acquisitions have allowed Zillow to expand their reach and increase their market share. They have also helped Zillow diversify their revenue streams.
Conclusion
Zillow is a real estate giant that has built its success on multiple revenue streams. Advertising, subscription services, data leveraging, a real estate brokerage model, home improvement services, and acquisition strategies all contribute to Zillow’s success. By understanding these different revenue streams, we can better appreciate how Zillow has managed to become such a successful company.
For people looking to buy or sell a home, Zillow offers a wealth of helpful resources and tools. By using Zillow, buyers and sellers can save time and money while finding the perfect home. Understanding how Zillow makes money is just one more way to appreciate the value it provides.
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