Realtors indicate they'll spend more online and less on print papers, but they're not exactly sold on online paper sites, search or other Web options.
When the Newspaper Association of America feels the need to run an ad campaign promoting papers as "a destination, not a distraction," it may come as no surprise to learn that real estate agents are reducing their print newspaper spends, as was reported yesterday by Classified Intelligence. However, though they plan on boosting their online ad spending, many Internet ad options such as search, online newspaper sites and national realty listings aren't exactly wowing them.
"Real estate agents and real estate advertising are undergoing a very significant transition period, which is certainly not a surprise," observed Peter Zollman, founding principal of Classified Intelligence, publisher of the Real Estate Advertising 2006 report. "And when it comes out the other end," he continued, "online will be a substantial winner and daily newspaper print is going to be a significant loser."
According to the study's findings, 19 percent of the 100 real estate agents surveyed online this June spent less than 20 percent of their total ad budgets on newspaper print ads, and 17 percent steered clear of print paper ads altogether. Although many said their overall ad spend will increase this year, money isn't simply shifting directly to the Web. Sixty-one percent of respondents did not buy into online newspapers at all.
"Local newspaper Web sites, which in many cases have done a very good job of developing online tools, are not viewed very highly by the real estate agents," opined Zollman.
Other online media may also leave something to be desired. The study found 69 percent of participants didn't spend on local niche publications online, and the same portion of participants kept dollars off national and regional Web services. Fifty-eight percent of respondents stayed away from local search ads, too.
"Many local advertisers still struggle with the search advertising component because it's still pretty complicated," Zollman noted.
As for online options, 21 percent of respondents put 10 percent of their ad budgets towards local newspaper sites, and 12 percent spent 20 percent on local paper sites. Sixteen percent surveyed put 10 percent towards local niche Web publications; 5 percent spent 20 percent of their budgets on online niche publications. National and regional Web realtor services didn't fare much better: 17 percent allocated 10 percent of their ad dollars to sites like Move.com and Realtor.com, and 6 percent put 20 percent on such sites. Fourteen percent of realtor respondents put 10 percent of their overall ad spends towards local search advertising; 12 percent spent 20 percent on search.
So, if 58 percent of real estate agents surveyed are raising ad budgets this year, where is the money going? Where they are spending the bulk of the money online, in fact, is on their Web sites. Twenty-six percent spent 10 percent and 29 percent spent 20 percent of their budgets there. Just 6 percent did not spend at all on their Web sites.
Though they cost nothing monetarily, free classifieds sites like Craigslist and GoogleBase are attracting just 51 percent of realtors surveyed. "The free sites are free of charge, but they are not free of effort," stressed Zollman, noting the need to set up automated listings feeds, manually submit listings, and manage listings on free sites.
The numbers show realtors are still spending in traditional marketing venues. Thirty-six percent of participants spent 10 percent of their ad budgets on print papers, 19 percent spent 20 percent there, and 8 percent put 40 percent of their dollars into print papers. Direct marketing and local niche print publications are also still garnering a relatively significant chunk of spending. However, tried-and-true yard signs, flyers and billboards still fare well compared to other media. 36 percent of respondents put 10 percent of their dollars in such places, and 28 percent placed 20 percent of their ad spends on flyers, signs and billboards.
As report panelist Vince Malta, president of the California Association of Realtors, notes in the report, "I generally see that people are advertising a great deal through their signs and putting Internet links on their signs."
Companies like Prudential Real Estate and Yahoo are hoping to benefit from this new trend. As announced Tuesday, Yahoo is promoting its real estate section offline through thousands of Prudential home sale yard signs featuring Yahoo branding and a property-specific searchable code that leads to a Web page featuring property details and photos.
Real estate ad monies may not have moved online completely yet. Still, the report asserts, "Usually, sellers are also buyers – and better than three-fourths of U.S. home-seekers are using the Web. Realtors will eventually convince home sellers that they should advertise in the same places they are looking to find their next home."
"[Realtors] understand the future is not where the past was," concluded Zollman.
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