Real Estate Advertising Moving to Internet from Newspapers.doc

Real Estate Advertising Moving to Internet from NewspapersSeptember 6th, 2006 | Real Estate, Real Estate SalesThe headline of this post, Real Estate Advertising Moving to Internet from Newspapers,may seem like a no kidding to those of us online, it is a scary reminder to the newspaper industry. The classified sections of the paper have lost a great deal of revenue fromCraigslist andthe Mthat have taken a good deal of the revenue from this section of the paper. Nowreal estate agentsare wising up and starting to take their advertising out of the newspapers.Most real estate agents will tell you that classified advertisingdoes notwork forselling a home, but it is something that the sellers expect theagents to do. So they continue to plow money into a dry well, so to speak. Butwith the rise of the internet and tools that make the jobeasier, real estate agents are slowing moving their marketing dollars over to the new frontier. While revenues from print real estate classified advertising seem to have grown steadily over the last five years, despite the emergence of the Internet, new data from Borrell Associates indicate that an increasing proportion of all real estate advertising spending will be done online in the future. By 2010, Borrell Associates expects 32.1% of the $9.6 billion spent on real estate advertising to be done online. This is up from 17.7% in 2006.In a survey of more than 100 real estate agents conducted with RealtyT, 58% of respondents indicated they are raising their advertising budgets this year, but the majority said they would be spending the bulk of their money online on their own Web sites. Free Web sites such as Craigslist and Googlebase are also attracting an increasing proportion of real estate agents over traditional mediums such as local print. via eM Why Advertising Real Estate In Newspapers Does Not Make SenseNovember 5th, 2007 | Real Estate Sales, Real Estate Tools, real estate indicatorsMore and more real estate agents and brokerages are pulling their advertising from newspapers. The main reason is they do not work in selling homes. Younger and more affluent families get their news and information online, not from print newspapers anymore and circulation figures are proving this. So if you need ammunition to show sellers that your advertising dollars are better off spent online, print this post and show them how quickly newspapers are losing their readership. It may help them to realize that you spending your marketing dollars online makes the most sense. Real Estate Ads Move to the InternetSEPTEMBER 8, 2006 TechnologyBy Timothy J. Mullaney Real estate listings are moving online, and newspapers are racing to protect their classifieds market by following them Three new studies say the $11.6 billion real estate ad market is set to shift hard from print to the Internet. For now, real estate ads in daily papers are up: 19 percent in the second quarter of 2006, according to the Newspaper Association of America. But consulting firms Classified Intelligence and Borrell Associates and the investment bank Piper Jaffray (PJC) all say that wont last. Borrell says the Internet real estate ad market, now about $2 billion, will pass the now-$4.3 billion newspaper ad market by 2010. We see newspapers losing at least seven points of market share by 2010, Borrell Associates President Gordon Borrell says.MISLEADING STATISTICS. Newspapers have an estimated 37 percent of the market now, and the shift would mean a difference of as much as $1.8 billion in annual revenue. Even this year, Borrell expects a fall. He says the big gain at dailies that belong to the newspaper association masks a collapse at weeklies and alternative papers, and believes print overall will lose more than two market-share points this year alone.For years, brokers have been anxious to move away from advertising in newspapers. Privately, big brokers like Chicagos Baird & Warner and Realogy (H), the publicly traded company that owns the franchisers Coldwell Banker and Century 21, have said they have stuck with papers because the real estate boom was throwing off so much commission revenue. They argued that the main reason to stick with print, despite what they say is a relatively poor return on their advertising dollar from newspapers, was that home sellers expected to see them use every available medium to sell homes. And since listings are scarce in a sellers market, thats what agents and brokers did. The sellers require print ads but they dont pay for them, says Steve Murray, head of industry consulting firm RealTrends. Brokers are trapped.The shift in advertising, if it happens, will be years behind changes in shopping behavior by home buyers. Studies by the National Association of Realtors and other groups show well over 70 percent of buyers begin searches on the Internet, often by hitting sites like Moves (MOVE) R. A January survey by the NAR said 77 percent of buyers start searching online, up from 71 percent in 2004.Indeed, the Net already drives consumer behavior. The bigger, more notable jump in the NARs data is in the percentage of buyers who pick a home they first identified online, usually before consulting an agent. Thats up to 24 percent, from 15 percent in 2004 and 2 percent in 1997. Only brokers themselves point out more homes to consumers, at 36 percent. The Internet has waxed such longtime staples as yard signs, which come in at 15 percent. Newspaper ads accounted for only 5 percent of sales, according to the NAR.ANXIOUS SELLERS. But in a downturn, when unsold homes are backing up on the market, Piper Jaffray analyst Aaron Kessler says brokers usual response has historically been to advertise heavily in almost any available medium for the first year. Thats why Cook, for one, doesnt expect a big dip in newspaper advertising soon. Newspaper execs naturally agree. I dont see doom and gloom, at least not for the next year or two, because sellers can tell brokers, Its a slow market and I want you to do everything, says Timothy Landon, president of Tribune Interactive, a unit of Tribune (TRB), which owns the Los Angeles Times and the Chicago Tribune.Over time, though, brokers spending will get more strategic. The signs are clear enough now. At Realogy, President Richard Smith says his company is spending heavily on its own Web sites, and its franchisees collectively are also the largest advertiser on R. In addition, Peltier says Iowa Realty, which like Edina is a unit of Berkshire Hathaway (BRK), has dropped most newspaper ads in favor of cheaper preprinted ads that can be inserted into newspapers. And Murray says Kansas City-based Reece & Nichols is running big newspaper ads only one weekend per month. Newspapers should beand arevery worried, Classified Intelligence analyst Peter Zollman says.Even the Sunday open-house listingsone of the newspapers bread and butter staplesare coming under pressure. Because brokers can display other agencies listings on their own Web sites under Multiple Listing Service regulations, they are positioning their own sites as places to advertise all the open houses in a market on a given Sunday. That gives an agent a shot at a commission for representing a buyer even if they cant land the listing. Peltier is doing just that in Minneapolis, and Murray says the largest real estate firm in Ohio, Columbus-based Real Living, is doing much the same thing. Most newspapers dont allow the same kind of ubiquity: Each advertiser promotes its own open houses in separate ads at most papers.NEWSPAPER SITES. The newspaper industry sees this comingand is responding. Classified Ventures, a joint venture of Belo (BLC), Gannett (GCI), Tribune, McClatchy (MNI), and The Washington Post (WPO), has started or bought a number of real estate Web sites, including home-appraisal site Homegain, apartment search site Apartments, and Homescape, a portal linking the online real estate sections of different newspaper sites around the country. Theyre also beefing up real estate sections of sites like ChicagoT.While specific data about real estate advertising isnt available, classified advertising of all types at newspaper-industry Web sites was up 33 percent in the second quarter from a year ago, Newspaper Association Vice-President Mort Goldstrom says. Tribunes Landon says his firm is gearing up especially to shift its open-house franchise to its newspaper sites, with moves hes not ready to disclose. We believe we have enough market power and pricing power that the agent will give us all the information and multiple photos, and get the print-and-online combination, he says.But the question isnt whether real estate ads will move online: Its how fast, and whether newspaper sites can protect their share. Newspapers havent been very effective in competing with Net rivals so far, with newspapers losing big chunks of business in help-wanted and auto advertising as those categories have moved to the Net. Given that track record, its easy to be pessimistic. Mullaney is E-Business editor for BusinessWeek in New York Real Estate Marketing TipsAdvantages of Online Real Estate MarketingThere are several reason why marketing online has become extremely important to the competitive real estate agent. 71% of homebuyers use the Internet for research and to search for listings and services Internet homebuyers make better clients It saves time and is more cost effective than most traditional forms of marketing Millions of Homebuyers Hit the Internet for InformationThe Internet is the first place more and more homebuyers are beginning their search for a home. According to a study done by the National Association of Realtors, 71% of homebuyers take their search online. These numbers will only increase with the Internet reaching more and more households. Nearly 70,000 new people are getting Internet access every day. Studies also show that the average homebuyer is also getting younger, and increasingly grew up with the Internet. Internet Homebuyers Make Better ClientsAccording to a study commissioned by the California Association of Realtors, Internet homebuyers were reported to be wealthier and purchasing more expensive homes. Internet homebuyers bought a median priced home of $452,000 while traditional buyers purchased a median priced home of $310,000. In the same study, homebuyers also reported that the Internet shortened their home search. The entire home purchasing process took half as long for homebuyers who used the Internet as those who did not. More importantly, Internet buyers spent half as much time with their real estate agents, visiting only half as many homes as traditional buyers before making their purchase. They were able to view listings online and narrow down their search to the few homes they were strongly interested in. Homebuyers using the Internet were also more knowledgeable about the purchasing process, and expressed greater satisfaction with their real estate agents. More expensive purchases, shorter search cycles, and happy clients who are better informed about the home-buying process - could it get any better? In fact it does! Homebuyers who search the Internet are actually more likely than traditional buyers to use a real estate agent to find their home and complete the purchase. 77% of Internet homebuyers use a real estate agent, compared to only 70% of those who do not take advantage of the Internet. If youre not marketing online, youre losing a goldmine of prospective clients. Online Marketing Saves Time and is Cost EffectiveIn addition to the huge audience of excellent prospective clients, the Internet offers both convenience and cost effectiveness that traditional media cannot. Web sites are more engaging and informative than even the best brochures. Emails make it easier and cheaper to keep in touch with existing clients. You do not need to have a four or five-figure marketing budget to create a professional online presence. Real Estate Marketing Online - First Things FirstAccording to a 2003 NAR survey, 71% of homebuyers use the Internet in their search, up from 41% in 2001. Needless to say, the Internet has affected the way we market and sell real estate. Despite the massive shift of homebuyers online, most real estate agents say their websites arent generating any new business for them. While most agents understand the importance of marketing online and readily purchase a web site, they usually do not put in the time to make their investment truly effective. Whether this is due to unrealistic promises from their website designers, a misunderstanding of how the Internet works, a lack of time, or a lack of direction, many web sites are falling far short of their potential.Real Estate Internet MarketingWhy should you be focusing more on Internet Marketing?Buyers are now using the Internet as a medium to find real estate agents more than any other source today. There are over 2,000,000 searches for real estate and realtors through Google, Yahoo, and MSN every day!Did you know that 80% of consumers never leave the first page of their search results? Additionally, 95% of consumers never make it past the second page of their search results. Unfortunately if your site is not present on the first two pages of Search Engines; you are receiving little or no traffic.Home shoppers do their hunting onlineUpdated 2/9/2007 4:29 AM ETBy Noelle Knox, USA TODAYIf theres any lingering doubt about how the Internet is transforming the way people buy and sell homes, heres eye-widening proof: Marnie Azadian and her husband just moved from Scottsdale, Ariz., into a $410,000 home in Tulsa that they bought 100% over the Internet.They never visited Tulsa, where Marnie had accepted a job. They never opened the front door, or a kitchen drawer. Never drove around the neighborhood.I did have some moments of Oh my gosh, what did we just do? says Azadian, 57, but no regrets about the house theyd fallen in love with from a virtual tour. (Though her commute is a bit more of a pain than it looked like on .) Risky? Maybe so. But this is just a glimpse of how rapidly and radically the Internet and other techno-gadgets are reshaping real estate sales. Already, 80% of buyers used the Internet to help find a home, according to the National Association of Realtors. Day by day, new real estate tools are surfacing on the Web.Technology is shifting knowledge and power to buyers and sellers. In doing so, its loosening Realtors long-standing control of vital information and cutting into their sales commissions. For more than 100 years, Realtors have guarded the details of homes for sale via their multiple listing services. At least 900 regional MLS systems exist nationwide. Unless the MLS systems become more open, unified and technologically sophisticated, they risk being replaced by a Web search engine.The Internet is a significant threat to Realtors, who in previous decades have had iron-grip control over all necessary information for those seeking to buy or sell a home, says Stuart G,abriel of the University of Southern Californias Lusk Center for Real Estate.Compared with the patchwork of MLS systems, each with its own board of directors, The Internet search engines may be very competitive and very efficient.Signs of upheaval in the industry were evident by late 2005, when the Justice Department filed an antitrust lawsuit against the National Association of Realtors. Justice wants the Realtors to stop letting brokers withhold for-sale listings from low-cost Internet rivals.The Realtors policy is on hold. But Brian McDonald, a deputy assistant attorney general for the antitrust division, says the policys restrictions still exert a chilling effect in the market because some companies wont risk introducing new Internet business strategies if they could be undercut in the future. But even as the two sides file motions, delaying the trial, the Internet is leveling the playing field and prodding the industry to adapt faster than you can say, Your honor, wed like a recess to consider new developments.In just the past few months:Z, which created a stir last year by posting its estim