Another player has launched in the online real estate vertical. MyNewPlace deals with rentals only and specializes in apartment complexes where it can form relationships with a single point of contact that represents many units. This strategy has allowed it to go out and line up 6 million units nationwide before launch.
This strategy also works well with its intent to provide rich and standardized data about the rentals available on its site, including floor plans and digital images. For these things it works with the rental offices of the many apartment complexes with which it has formed relationships. What this all equates to is a rich and clean user experience that isn't cluttered by ads. It also plots search results on a map. A clean and functionally sound user interface is in fact one of the company's main selling points.
After building a large and growing database of apartment listings and their corresponding pictures, floor plans and other media, the next step for the company is to build traffic — hence the user-centric strategy. This strategy is necessary, according to CEO John Helm, because Internet users have gotten very sophisticated. There are few apartment rental sites out there that have addressed that level of sophistication or have met the expectations for clean design and advanced functionality that the average Internet user has developed today, according to Helm. Interestingly, apartment complex managers have also gained a great deal of sophistication — a boon for MyNewPlace because its strategy to provide rich apartment data is at the behest and technical savvy of apartment managers who provide the data.
So how does the site make money? It operates on a pay-per-performance basis where it gets a premium on a lease that has been signed through a lead it created. There lies a challenge here, of course, in that tracking users from its site to the signing of a lease is an imperfect art. The company has designed a system to deal with this wherein it offers a $100 rebate to users who sign a lease for an apartment found on the site.
In essence, it is buying a tracking system for $100 per conversion. This is not a bad deal if you consider that tracking is a challenge present across the vertical search and online marketing worlds and that tracking customers to the offline transaction is an integral part of its own model. It's a creative way to deal with this challenge, which also serves as a tool to attract users. We'll be following this strategy closely to see how it works, and see what kind of uptake the site has among renters. Check it out for yourself and let us know what you think.
The press release is here