As if online newspapers didn’t already feel battered, a new real estate advertising report won’t ease the pain. The study of real estate professionals shows they’re turning their backs on local online newspaper classifieds and display advertising, and finding value in e-mail, local listings sites, search, and social media.
Over 60 percent of the 200 real estate agents studied for Advanced Interactive Media Group’s Real Estate Advertising 2009 report said they do not plan to spend any money on online newspaper ad products this year. Almost the same portion said paper sites are not effective for leads. The AIM study was conducted with support from real estate industry publication Inman News.
There are two primary factors contributing to the failure of newspaper publishers to offer value to real estate advertisers, says the report. One is bundling, the practice of selling print and online ads together as a package. For some newspapers, “The only way you can get online is to buy something in print,” explained report author and AIM principal, editorial director Jim Townsend. “It’s a model that’s eating itself.” In earlier days, newspaper sites offered online advertising as value-adds, essentially providing them for free when advertisers bought print ads.
Pricing is another contributing factor. A lot of paper publishers still set display ad prices based on their presence in their local markets, even though advertisers can buy geographically-targeted display ads for far less through national sites and networks. “They think the model they had 10 years ago or even 5 years ago is still something they can use,” suggested Townsend.
According to the study, 40 percent of real estate pros won’t buy online newspaper advertising in 2009, and 18 percent will spend less. About 12 percent will spend more, and 30 percent the same amount as last year. In comparison, 38 percent will spend more on e-mail, 35 percent will spend more on social network sites, and 28 percent more on local search.
After their own Web sites, real estate agents said e-mail, search ads and national listings sites garnered the highest ratings as lead generators. E-mail is used by almost 60 percent of respondents, according to the report. Around 45 percent use local search and about 40 percent use real estate listings sites such as Realtor.com, Trulia, Zillow, and Craigslist.
When it comes to real estate listing sites, Realtor.com scored high. The site, owned by the National Association of Realtors, is used by 86 percent of survey respondents, more so than any other national listings site. And, more than any of the other listings sites, it received the highest rating in terms of value from almost 40 percent of those studied. Craigslist came in second place, garnering a top rating from 28 percent.
About 30 percent said sites like MySpace and Facebook drive quality leads, and over one-third of survey participants said they plan to spend more on social networks in 2009. Still, around one-third don’t use social sites, and the remaining third say they don’t generate good leads.
Overall, the study found that 28 percent of real estate professionals will spend more on advertising this year, 33 percent will spend less, and 38 percent will maintain 2008 spending levels.
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