I mean, I think that’s a lost opportunity for the seller to get the highest price possible. And also, it’s a lost opportunity for the sellers to fairly participate and try to put the best offer out there. So, Ten-X can bring value there. I think elements of what Ten-X has worked on like deal room documents, that sort of stuff that may occur in 2024. But right now, we are excited about and have very robust product plans going into 2024 that we think will deliver real value and Ten-X would be a little bit further out there.
John Campbell: Okay, that’s very helpful. Thank you, guys.
Operator: We’ll take our next question from Jeff Meuler with Baird.
Jeff Meuler: Yes, thank you. So, just first, it looks like the EBITDA guidance maybe comes down $27.5 million at the midpoint. I think you said, Scott, that the increased Homes initiative spend is around 30. So, can you just confirm if the consolidated EBITDA guidance change is almost entirely just the increased Homes investment?
Scott Wheeler: Yes, and a little bit of drop-through, obviously, from the revenue. So, the Homes investment number is probably smaller than the 30 by a little bit, somewhere in the mid-20s, possibly, but you’re kind of in the ballpark.
Jeff Meuler: Okay. And then, I see the great traffic numbers. I guess, help me think through anything further on like what you’re seeing in terms of quality of Homes.com traffic. There was some metric, like a 900% increase in revisits or something, but, what are the other benefits? I’m thinking about like the ability to market a big traffic number as you launch products, any sort of future SEO and SEM efficiencies that could come from a lot of traffic flowing through your site ahead of some of those additional investments, things like that?
Scott Wheeler: I think we’ll put the number in there about the really outstanding numbers for return traffic as a key point because we are seeing significant growth in return traffic, which means in my mind that people come into the site, like the experience, like the layout, like the fact they could reach agents directly, not go to a call center, not get rerouted around and sold. So, we think that number shows exactly what we want to see, which is the fact that we’re winning over some consumers. So, that’s exciting. Certainly, we don’t want to go into too much detail on what we’re doing on any given day, but certainly you work the blend of SEM/SEO and branding at different points and different phases to get the optimal result.
We’re doing the things you would do at this point in time. We’re getting, I think we can confidently say we’re double the traffic that we expected to have at this point, so we’re happy with what we’re doing right now. And I look forward to being able to do the next steps, which optimize the site even further. I think one of the metrics is probably not coming up, but I believe is there. It’s a little tougher to measure, but we’re seeing some of it is we’re getting some really good lead flow numbers. So, I think that a significant number of consumers have figured out that if they’re interested in a property, when they come to Homes.com, they get directly connected to the person who knows the most about the listing, and we believe that’s the best consumer experience.
And they know that on some of the alternative sites, they are going to go through a ringer of a sales process to be sold a buyer agent. They’re not going to get a quick answer about the property they were expressing interest. So, I think we are seeing — it’s early to tell, but I think we are seeing a significant advantage in traffic to lead flow ratio compared to some of the other players out there. I do believe that even though we are not monetizing today, I believe it’s quite possible that we are perhaps demonetizing some other sites, because if a lead comes through to Homes.com, that lead may no longer be available to go to another site, even though we’re not charging for it.
Jeff Meuler: Got it.
Scott Wheeler: We go on, there’s lots of different metrics out there, but I think lead flow is a good one. You can tell from Apartments.com and our track record there, we’re very good at thinking about those leads and the quality of the leads and not spraying junk leads at people, and optimizing the experience and reducing the friction when people actually want to express interest in a particular property.
Jeff Meuler: Got it. Thank you.
Operator: [Operator Instructions] We’ll take our next question from Nicholas Jones with JMP Securities.
Nicholas Jones: Great, thanks for taking the questions. I guess maybe kind of double-clicking on lead quality on Homes.com. Can you kind of speak to the uniqueness of the leads? Are there people who are maybe coming through and maybe the average response time isn’t fast enough and then they’re kind of abandoning and going to other sites where they can kind of get on-demand tours? Can you kind of speak to the difference, I guess, in response time and maybe then what the uniqueness is in the leads to the agents based on kind of what the consumer needed? They may have a question that’s very specific to the property, or they just may want to get a tour quickly and they’re looking for kind of a quick response?
Scott Wheeler: Are you asking when I stopped beating my dog? I’ve never beaten my dog. And we don’t think that we have a slow response time on leads on Homes.com. In fact, I would believe we have a better response time in that if you are reaching out to the person that’s got the listing, they know the most about the listing and can respond quickly, and you get a single point of contact typically as opposed to alternative sites, you might get many people responding. You might get four or five agents calling you back about one house you expressed interest in. We feel confident that the experience we’re giving the consumers is a solid experience, and we think, when you talk to a leader in portals over in Europe and you explain how the legacy models work in the United States and how Homes.com works in the United States, people have operated portals for 20 years, and they do it the way homes.
They listen to what I’m explaining about how it works in the United States, and they go, well, gosh, that’s really obvious. The consumer would prefer to contact the person who has the listing and knows the property rather than contact someone who doesn’t have the listing and doesn’t know the property. And so, in the eyes of someone that’s not been exposed to it, our lead process would appear to be the obviously superior process.
Nicholas Jones: Great, thank you.
Scott Wheeler: I’m not sure if that answered the question or not.
Nicholas Jones: It directionally does.
Scott Wheeler: Okay, great.
Operator: We’ll take our next question from Ashish Sabadra with RBC Capital Markets.
Ashish Sabadra: Thanks for taking my question. So, I just wanted to ask about the international M&A opportunities. Obviously, you’ve talked about OnTheMarket and organic investments there, but would you also consider doing more tokens or strategic acquisitions to build out the pan-European platform? And then would you also look at other opportunities outside of Europe? In particular, you called out how you necessarily are not interested in the number one property but going after good properties. Would you apply the same approach when you think about M&A outside of Europe or in Europe or outside of Europe for residential assets? Thanks.
