Toward the end of the 1977 academy award winning film Annie Hall, Woody Allen turns to Diane Keaton and utters the memorable line; "Relationships are like sharks, they have to keep moving forward or they die, and what we got here is a dead shark."

The same might be said about real estate lead generation websites -- especially the big ones. They either move forward to help practitioners create relationships with consumers or they die, and what we have here is a growing number of very sick sharks.

The conventional wisdom is that new listing formats, pictures, gee wiz mapping, blogs and video features will create an incredibly compelling consumer experience, thereby helping to sell houses. This technology can attract and retain an audience of tire kickers, but does it help create a connection between consumers and practitioners? What percentage of repeat visitors to real estate websites are successfully referred to a broker or agent?

The recent exit of Realestate.com from the "lead generation" business may simply be the first public acknowledgement that the sharks of online real estate lead generation don't do a very useful job of creating meaningful relationships between the consumers and practitioners they profess to serve.

Relationships in the virtual world aren't much different from relationships in the real world. Good ones are based on reciprocity and confidence. Consumers expect quality information, they want connections to resources, they need insight from a trusted advisor and they demand anonymity and privacy until they are ready to engage. That's the expectation when we shop for a lawn mower -- so what do we get when we start to think about buying or selling a house?

Most visits to real estate sites are empty. Consumers browse content and leave few clues of their presence behind because they don't want to be hassled. Real estate sites spend big money on technology and marketing to look cool and attract attention, and then when they try to introduce themselves … consumers bolt. Would you:

• Register your personal information on a website?

• Give your email to organizations you don't know?

• Offer your business card to every stranger you meet?

• Want a sales person looking over your shoulder, filling your inbox with spam or calling your cell phone?

If you aren't satisfied with the quality of leads you get from real estate websites -- there's a reason. Consumer real estate portals are designed to entertain and keep a consumer's interest. They care more about eyeballs and traffic statistics then they do about enabling business relationships. Allowing your prospective clients to safely share their intentions, preferences and personal situation with you is not part of their agenda. They do "consumer experience" … not customer relationships. And now they are in big trouble as advertising dollars and venture capital looks for higher returns in safer sectors of the economy.

Real estate is a local, complex, relationship driven business, and technology and content are losing their ability to differentiate one source of information from the next. Consumers will go to many sites, especially in a down market, and the landscape is full of clutter and confusion. Listings are a commodity, mapping is old news, video is for entertainment rather than insight and many blogs are just a different form of advertising.

The sharks would still be swimming if they had spent a small fraction of their funding on reducing the trust barrier that prevents effective connections between consumers and practitioners.

A characteristic of social networking sites is that they don't ask you to divulge personal information or provide email addresses to join their conversation. Many allow you to select a pseudonym, creating a personalized but anonymous identity. This simple but powerful feature creates a safe environment for a protected dialogue. Real estate sites could easily connect consumers to practitioners much earlier in the sales cycle, improve the quality of the information exchange, accelerate the process of building trust and guide the process of starting beautiful business relationships. That's the steak, but the sharks need to hype the technology sizzle.

Real estate websites will eventually facilitate conversations between consumers and practitioners, create truly qualified leads and support all facets of the homeowner ship experience. Your web partners will learn to engage home buyers and sellers in a manner that builds trust, intimacy and long term value. This won't require new technology, just a different business motivation and mindset about relationships.

Until then the only verifiable fact about the referral power of real estate listings is that it helps drive subscription and advertising revenues for newspapers and web portals, and the numbers are sinking. The dying sharks haven't yet delivered on their promise of connecting consumers to practitioners and facilitating business relationships.

The market, like the sea, is unforgiving.

Published: September 25, 2007

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