Dull thoughts in a sharp world.

After working on RentWiki.com for about 9 months now, consumers have been responsive to the generally concept and vision of the project. It is nothing complicated, just compiling advice, reviews, and opinions about moving to a new city. Having moved 4 times in the past 2 years, I know the value of advice when trying to find a suitable rental. On the surface, seems very simple, useful, and a much needed service.

So why isn’t there a flood of competitors like all the other review sites. There are literally dozens of electronics and gadget review sites, hundreds of business review sites, book review sites, etc. So let’s start by listing some current direct competitors (neighborhood and rental reviews):

Yelp.com
ApartmentRatings.com
Neighboroo.com
RottenNeighbor.com
StreetAdvisor.com
SquidZipper.com
Realtor.com (Wikihoods)

And aside from ApartmentRatings.com, none of those sites have an Internet listing site/help users find rentals. Here is what I think is keeping social media sites to from flooding the Multi-family housing space.

1) Relationship driven industry – At every conference I go to, I feel like I am at a ABC High School reunion and I went to XYZ High. The sales people, marketing directors, VP’s, and even CEO’s all know each other from years of working together, and it is like a revolving door, with employees moving from company to company. So everyone knows each other and it makes it much easier to get a meeting with the decision makers of REITs or management groups if you’ve been buddies with them for years. Incumbents have a much easier time keeping sales contracts, and new-comers are left to have to take those away. No revenue = No company

2) Small Market Size – VC’s typically want at least a market of one billion. I’ve hear $500 million, but VC’s are looking for a 10 times return and you really have to have a strangle hold on the market to return 10 times in a small market. The total spend on online advertising in the multi-family housing space is $700 million. No funding = No company

3) The Stickiness Factor – Since people only move once every 18 months, creating a community and stickiness is a difficult obstacle to overcome. Unlike restaurants, news articles, or electronics, people only move once every 18 months. However, I think it is similar to TripAdvisor with reviewing major trips. No content = No company

4) The ApartmentRatings Factor - I call this the ApartmentRatings factor because the website ApartmentRatings.com was one of the first social media entrants to enter the Multi-family housing market. However, they set the stage for why the industry is so behind in dealing with social media. Inherently, most people are not satisfied with their apartment and satisfied with their location. So they used ApartmentRatings.com as a medium to voice their dissatisfaction with their property management groups and it left a sour taste with the Multi-family housing industry. Mention ApartmentRatings.com with a group property managers is like saying you’re voting for McCain in San Francisco. No support = No Company

I’m sure there are a dozen other reasons, but I am predicting a flood of new companies/existing companies switch their model to incorporate social media in the next 12 to 18 months. Moving is one of the most difficult things to do in life, and it doesn’t have to be.

*As an aside… how is it that there are three toilet review sites out there? SitorSquat.com, MizPee.com, and Diaroogle.com.