The fallout from the subprime loan market crash has had online ad industry observers concerned about a drop in financial services ad spending. One would think a firm like home value estimate provider Zillow would fall victim to a drop in dollars from mortgage loan providers, insurance companies, and other endemic advertisers. But the company’s recent ramp-up in sales staff and plans for more hiring in that department indicate its ability to attract advertisers is alive and well. ClickZ chatted with Zillow’s VP of Sales Greg Schwartz yesterday about what’s driving the demand for more sales staff, and who those new recruits are selling to. In addition to garnering a new revenue stream through its self-serve local ad offering, the company is beginning to collect ad dollars from national brands in the less-obvious auto and retail categories.
Q: How many people are currently on the Zillow sales staff and how many is the company expecting to hire?
A: We have 20 now…and hired 15 in a period of few months, in August, September and October. There’s a tight talent market out there. We’ll add another 10 next year starting in the first quarter.
Now we have to go out and get new office space. We looked at seven spaces yesterday [in New York], but haven’t made a decision yet.
Q: What’s driving the need for more salespeople?
A: Advertisers are doing more advanced planning than they have in the past. Automotive marketers in the past have been really disciplined with advanced buying…Now across all categories of advertisers, there’s been a great deal of advanced planning.
[Inventory] goes in the fourth quarter for the following year. If advertisers don’t get in there, they’re fighting for the scattered market next year.
In the categories I operate in (telecommunications, financial services, home building) inventory is constrained, so folks want to get in there and make great deals.
Q: The real estate market has been shaken quite a bit lately as a result of the subprime mortgage fallout. How has this affected Zillow? People might be surprised the company is looking for more salespeople in light of this.
A: Volatility is good for our traffic because people are quite interested in the value of their homes and they’re researching it. They’re spending a lot of time with us, even more so than in the past.
The second thing is we have a very, very affluent audience…. Our [users] aren’t typically subprimers…All those [advertisers] targeting prime lending are still [advertising].
Q: What has Zillow’s recruitment experience been like?
A: Folks can get great compensation lots of places; the market is hot, and that’s now just expected…
The best talent I’m finding are folks that are not from pure-plays…I’m finding salespeople who are extremely talented and experienced with the Internet model of advertising, but who are at companies where the Internet is an extension of the organization, not the core component of the business as it is at Zillow. [As an employer], we must be exceptional at it and innovative at it…If I can get paid a whole bunch no matter where I go, I want to go where my job is important.
Structure is also important. There are no secrets here. The folks on the ad team are aware of what’s being done by the product team…That just brings really entrepreneurial people on board and keeps them here. I don’t just want to know about the ad business, I want to know about the overall mission because I care.
Q: What companies are your sales staffers coming from?
A: They’ve come from Yahoo, Viacom, Time Warner, from The Economist, Microsoft — sort of the mainstays. A lot of these folks have not worked at pure-plays.
Q: Is the apparent dearth of knowledgeable online ad industry staff affecting recruitment for sales positions, too?
A: There’s been a massive expansion in a number of outlets, particularly ad networks…. We haven’t had any trouble hiring though, anywhere in the country.
There are tons of Internet sales jobs open at any given time; I’ve never seen a hotter market…. The key, again, is to provide an entrepreneurial environment where folks can drive their careers forward rapidly.
It’s not about dry cleaning or foosball…It’s about the core business.
Q: How is the self-serve ad product you launched in April selling?
A: A core constituency of ours is local advertisers…That’s newfound digital money. In tougher times one wants to be more accountable with their ad spend than less and that’s good for the Internet. [According to Zillow, over 7.000 advertisers have placed text and image ads through the system.]
Q: What about larger national brand advertisers? Who’s advertising on the site?
A: DirecTV made some major investments in our Web site. They recognize [people who are moving are] key in the telecommunications research process…. They want to be in front of new home purchasers. If you look throughout our Web site, you’ll see a very heavy DirecTV presence. They’re doing everything from geo-targeting certain key footprints, tailoring different messages to different parts of the country, to behavioral targeting [and other types of targeting].
Life stages trigger purchases, and one of the key life stages is moving…You have a real estate transaction, and that transaction triggers a lot of things.
The automotive industry is recognizing that moving is a life stage, and it triggers automotive buys…[Moving is] one of the biggest drivers of new signups for ISPs, phone services, even wireless carriers.
Zillow is there earlier in the [buying] process. The key is [advertisers] brand or market to consumers before they close on the home purchase. Once they’ve done the change of address form, it’s too late.