It’s no secret newspapers are dying. Most are struggling to transition to a new digital environment. And let’s face it. Most newspaper web sites are pretty awful. Many are stuck in legacy platforms, saddled with expenses and without the resources necessary to bring their sites up to 2.0 snuff. (Sound familiar brokers?)

And since craigslist has already gutted their real estate advertising revenue, it seems many papers seem to be abandoning the space altogether. Leaving it as someone else’s problem.

Zillow.com announced today its plans to launch co-branded real estate Web sites with 180 newspapers across the US.

The Tampa Tribune and 100 other newspapers published by Community Newspaper Holdings, Inc. are amongst the first to take up the Zillow brand. For example, Homeseeker on TBO.com now just redirects all property searches to a cobranded Zillow page.

This is great news for Zillow who get all the SEO benefit of those inbound links, fantastic name brand awareness in each of these communities they go live in and tons more traffic to prop up their advertising CPMs.

And presumably, the newspapers get a cut on any ads sold in their Zillow space.

Of course, all of this isn’t particularly revolutionary, it builds on Trulia’s existing Publisher Platform and the granddaddy in the space, Classified Ventures’ Homefinder.

But it’s interesting to see the degree to which the newspapers don’t seem to care about monetizing real estate traffic on the ‘net. I’m not sure if its just not profitable (no advertisers) or they don’t have the capacity (or capability) to monetize it successfully and so are just willing to hand it off whole to a third party.

In any case, it seems a little short sighted.

A couple years ago I spoke to a group of newspaper advertising executives about what to do to save their real estate sections. I suggested that they look beyond banners and classifieds and build out a whole platform to support real estate agents and brokers taking their marketing messages to the web; a listing syndication engine, a blogging solution, an advertising platform, a video hosting tool.

The vision? Rather than simply preying on advertising dollars from the industry – build out the tools that the industry so desperately needs. Become a trusted service provider and build a bridge between the professionals and the community the paper serves. One that ultimately in fact could be leveraged by all verticals.

In today’s climate, that may be too ambitious, and too late. And it all hinges on whether the local newspaper brands are still even relevant in a few years. I’m not even sure about that anymore.

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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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