3 Ps - The Future for Real Estate Newspaper Advertising
by maladiets
There’s no doubt it’s a bad time to be in the newspapers classifieds business. They’re probably wishing they could back in time too. Revenues are down - with real estate classifieds advertising being hit especially hard. Mega publisher McClatchy is down 29.4% in real-estate classifieds revenue. Likewise, Gannett’s real estate classifieds revenues are down 13.5%. Not a pretty picture.
Advertising dollars are slowly and surely fleeing print. A recent report from Borrell sums up this flight.
“There are less homes being sold, but at the same time advertisers and real estate brokers are looking for the most effective use of their dollars. And everybody agrees that the most efficient means is online.”
I think the flight is not just a flight from print advertising however. I think it’s symptomatic of a larger move away from the sort of fire-and-forget advertising done so much in the past, that just doesn’t work in a Web 2.0 world.
Carson Coots, writing at agentgenius.com, sums it up this way.
The funny thing is, effective online marketing in real estate doesn’t involve spending money on ads as much as it involves spending valuable time.
Carson is right. And if you look deeper into the report you find that spending on online ad is only 16.7 percent of total Internet marketing budgets. That number is only poised to grow to 17.3 percent in 2009. That’s less than one percent growth! The real bulk of online spending will continue to be in web site design, communications and database services.
So if the future growth isn’t really just more advertising options online, what is it?
At NAR, I sat on a panel in front of a group of newspaper execs who were trying to figure this all out. I suggested that simply adding new ad products into the mix (see Zillow and the Newspapers Sitting in a Tree) won’t solve their woes.
I proposed they needed to radically change their focus away from product-based mentality towards a new platform-based approach.
Real estate professionals these days are looking for marketing partners, not sales people, and the smartest thing for the newspapers to do would be to ape some of the models being pushed forward by the Real Estate 2.0 crowd and give agents a unified local real estate marketing platform. Here’s a few ideas how they could do this:
Providing the Platform
Leverage existing publishing infrastructure to provide agents/brokers with a web presence, but free the database from the design so it is totally customizable (Ubertor) and retain a unique top level URL and easily create single property web sites (RealBird). Agents have complete control of their presentation of these sites but traffic can easily be fed both directions. Make the data exportable so if the agent wants/needs to leave they can.
With control of the source of the listing data, it can then be pulled back to enhance the mothership’s search results. There is an opportunity to up-sell featured listings (Trulia) or even premium placement for the agent’s sites on search results (Zillow). Don’t get greedy either - help agents get these listings elsewhere on the ‘Net too (Point2NLS, vFlyer).
Give the agents a blogging platform (Move.com, ActiveRain) and allow the content to be rolled up into a hyperlocal information source (Outside.In, Localism, YourStreet). Bonus - you can use this approach to find talented writers that can build out into group blogs (RainCityGuide, BloodhoundBlog), e.g. the PI’s Seattle Real Estate Professionals.
Packaging the Right Tools
Give agents the tools they want to get video tours of their properties and connect the agents with the producers (RealEstateShows, WellcomeMat) but don’t confine the distribution to your site - following the listing model, help the agents syndicate those videos out across the web (TubeMogul).
Promoting the Brand
The package should include various levels of self-service advertising network (with CPM, CPC advertising options) - with options to centralize ad buys on other sites as well. The package could also include placement inside an enhanced local service provider directory (MerchantCircle) in the real estate section. And it should give the Realtor the tools they need to manage their online reputations on other local directory destinations (CitySearch, Yelp, etc.) as well.
With this approach, brokers and agents ultimately would benefit from the one-stop-shop for all their marketing needs as well as playing off the paper’s still resilient brand with local real estate consumers.
If they can see this opportunity, the papers are the only ones that (for now) have the local market penetration to pull something like this off. And at each of the step, there are clear and obvious ways that the newspapers could monetize this - far beyond selling simple classifieds ads.
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Lenore Wilkas | Nov 27, 2007 | Reply
Joel, newspapers have always had their heads in the sand and cried the same way when radio and then television entered the mainstream. They have had about 15 years to prepare for the internet and its full impact. I shed no tears for them because back in the mid-1990’s when I was selling ads for some now major websites, they were laughing and thinking the web was a joke. I saw the convergence of media on the web coming in 1992 when I was first shown what was coming down the pike but they had their heads in the sand then and now, it’s almost too late.
Todd Carpenter | Nov 27, 2007 | Reply
From many of the agent’s I’ve sp[oken with, I think print advertising would be even worse off if not for the consumer help perspective that it should still exist. “Why isn’t my house in The Post?” being more important that the actual ROI.
I think newspapers would be well served to find ways to keep that perceived value among consumers, as well as taking the forward steps you speak of.
Incredible Agent | Nov 27, 2007 | Reply
Newspapers have a tough road ahead. Anyone in print media is going to have to acquire/partner with companies from the web in order to maintain their revenue.
Many of these companies are already looking at online real estate as a way to maintain revenue. Hence, Classified Ventures buys HomeGain…Trader Publishing buys Homes.com, Advanced Access, Number1Expert and many more.
Change or die…or is that Buy or die?
Metrowest MA Real Estate | Nov 27, 2007 | Reply
Joel - Great article. The line add cracked me up! You didn’t take the trip did you
I scaled my print advertising back almost two years ago. I do very little with print in terms of promoting properties. The Boston Globe for years was a major source of business for myself and my partners but as time went on the return started to dwindle severely. If you look at the Sunday Real Estate section of this paper, it is a shell of what it used to be.
As we moved forward I suspect revenues will continue to drop.
Matt @ PlugMyListing.com | Nov 27, 2007 | Reply
I have to agree, newspapers are becoming obsolete. I try to explain this to the newspaper salesmen that knock on my door every other week, but I don’t think that’s what they want to hear.
Rob Aubrey | Nov 27, 2007 | Reply
It is kind of sweet to not have to pay an ad agency that sits and writes negative things about the market and agents.
Take your driveway litter and shove it.
turnofevents | Nov 27, 2007 | Reply
Newspapers are sales and publishing cultures. There is no marketing DNA or product development culture to speak of. During the housing boom, the salesforce was just a bunch of order takers. Anyone with a junior college degree could’ve made a killing. But they only had 1 thing to sell: liners and 1/4 inch ad space.
Unless a paper was to turn over it’s entire salesforce, it’s impossible for them to become a marketing partner for agents and brokers. They can barely sell their own product let alone an online bundle, let alone SEM, blogs, etc. Fuggadboutit.
That’s why the Zillow and paper deal makes no sense whatsoever. Classifieds Ventures has been distancing itself from the papers for a while now. Witness Homescape going after listings directly without participation from its paper partners. If Zillow is expecting revenues to be derived from upsells that papers would sell for them, they are going to be in a serious world of hurt. How will they motivate a paper salesman to hawk Zillow upsells? Talk about cost of sales, not to mention sales traning, not to mention managing price conflicts and absurd discounts, etc. The list goes on and on.
Self-service models are the wave of the future. You don’t need a burdened bunch of door knockers to lead you to revenue, especially a group dying on the vine.
Chris Dowell | Nov 27, 2007 | Reply
The newspapers need to go after the consumer and what is their best interest. If newspaper classified ads worked, agents would be advertising in them. Why advertise a home for a weekend for $100 with a four line newspaper ad when I can advertise the same home in Craigslist for free for 45 days and get a classy ad with pictures. My traffic on craigslist is at least triple the traffic of the local newspaper.
Kevin Tomlinson | Nov 28, 2007 | Reply
The only people who read the newspaper classifieds are the owners of properties for sale. The real buyers are on the net and I think it is waaay too late for the newspaper to do any kind of damage control.
The “new way” ship has sailed and McClatchy isn’t on it.
Sol | Nov 28, 2007 | Reply
Has anyone heard from Forsalebyowner.com lately? It was the largest transaction/buy/mistake made by the newspapers. Next to Homegain.
Zillow is run by a smart man that knows his potential buyer will be someone that needs his service. Zillow wants to become the forsalebyowner.com 2.0 for probable acquisition by positioning as the playground for ad buyers.
This has little to do with a change of direction but an exit strategy.
If I may add to the comment about self service
being the wave of the future, self service does not mean do it yourself.
Interestingly, the newspapers move at about the same speed as the real estate industry. If the newspaper is to co-exist with other media, it must first stop calling itself a newspaper.
My opinion is subject to change in ‘08.
John Wake | Nov 28, 2007 | Reply
With the current “green” craze, wait until consumers figure out that the single easiest and biggest thing they can do to reduce their “carbon footprint” is to cancel their newspaper subscription.
Mike | Nov 28, 2007 | Reply
Homes & Land Magazine and homesandland.com are providing RE agents the best of both worlds– “top of the line” full size full color-gloss magazines that sellers prefer; and a powerful national website that has content sharing with nytimes.com, wall street journal, trulia, and dozen or more export sites. Print is for sellers/ web is for buyers. Agents can make $$ on both sides (buyers and sellers). Realtor.com does not have a publication and most newspaper are inept with their web offerings. You have to offer both.
Kansas City | Nov 29, 2007 | Reply
Newspaper ads are worthless and the advertising dollars spent there are not recouped with resulting sales. Have we sold homes off a newspaper ad? Yes. Do we sell enough to even break even at best? No where near and we quit advertising in the newspaper years ago. Our resources are better spent online.
James Simpson | Nov 29, 2007 | Reply
Newspapers are falling apart because auto, classifieds AND re ads are dropping. Print is hurting everywhere. Why? Because even though CPM is low, if people don’t read then the medium isn’t going to work and the ROI isn’t there. We should all be applauded for looking at the bottom line and A. Minimizing the things that don’t work and B. Maximizing the things that do work.
There are alternatives in the B. category. The ideal demographic of a prospect lives in the neighborhood where the homes lanquish instead of selling, has a higher than average income, good credit, enough discretionary income to afford spending less on dinners out and more on a mortgage. My suggestion is to get in front of these people somehow.
How to get to them? Maybe the web but certainly more affordable “up front and in front” media MUST be available.
Take a look at a program that gets in front of this demographic and handles local (Cleveland) re advertising for $15.00. http://www.imediatetv.com
Search out local partnerships where you are with venues that are tv monitor owners… they NEED the revenues your advertising dollars could provide and you won’t have to print, mail, or advertise which will save big $!
Upscale family diners (NOT fine dining, bars, fast food or coffee shops) are the best partner and are the best complement to an effective on-line, consistant and affordable ad campaign. All this, of course, in my humble opinion.
James Simpson | Nov 29, 2007 | Reply
Print is hurting everywhere. Newspapers are falling apart because auto, classifieds AND re ads are dropping. Why? Because even though CPM is low, if people don’t read then the medium isn’t going to work and the ROI isn’t there. We should all be applauded for looking at the bottom line and A. Minimizing the things that don’t work and B. Maximizing the things that do work.
There are alternatives in the B. category. The ideal demographic of a prospect lives in the neighborhood where the homes lanquish instead of selling, has a higher than average income, good credit, enough discretionary income to afford spending less on dinners out and more on a mortgage. My suggestion is to get in front of these people somehow.
How to get to them? Maybe the web but certainly more affordable “up front and in front” media MUST be available.
Take a look at a program that gets in front of this demographic and handles local (Cleveland) re advertising for $15.00. http://www.imediatetv.com
Search out local partnerships where you are with venues that are tv monitor owners… they NEED the revenues your advertising dollars could provide and you won’t have to print, mail, or advertise which will save big $!
Upscale family diners (NOT fine dining, bars, fast food or coffee shops) are the best partner and are the best complement to an effective on-line, consistant and affordable ad campaign. All this, of course, in my humble opinion.
Misty Lackie | Nov 29, 2007 | Reply
Online is the way to go. It’s hard to argue with that when you can get effective online marketing from services such as ClassifiedFlyerAds.com for FREE and additional exposure from blog networks such as ActiveRain.
Joe Dahleen | Dec 2, 2007 | Reply
Joel - you are right on again.
I agree with your point and I also agree with SOL’s point. Zillow is the FSBO 2.O for sellers.
But I think that realtors need to offer ads in the sunday newspaper for the sake of their own clients. Most sellers (like a few of your comments show) read the sunday paper and they want to see their listing in the paper.
Oh by the way - the best single property website that I have seen is agencylogic.com.
Gavin Anthony | Dec 4, 2007 | Reply
Businesses will thrive that provide a suite of web based tools for the salespeople, it will help them retain the higher quality professionals while cutting costs.
Even if they have to place an ad in the paper once in a while just so the seller can see it and cut it out for the fridge.