Since the dawn of the internet, everyone has speculated that the face of the real estate industry would be greatly changed. That is no more evident than in the amount of business that we see generated by the internet vs. the various forms of print advertising.
Here in New York city where we lack a multiple listing service, The New York Times website is serving as a pretty good substitute. Not only are most all property listings (broker and for sale by owner listings both) contained on the Times website, but it also allows browsers to link to broker websites to view additonal photos, virtual tours, and floor plans thereby allowing the prospective purchaser to “weed out” properties that don’t necessarily match their criteria.
The days of clients walking around the city with the newspaper are long past. Today, buyers show up to open houses with printouts from various websites and they already have clear expectations of a property based on the floor plan and photos.
Richard Nacht at RealBlogging recently attended a presentation by Allan Dalton, President and CEO of Realtor.com. Nacht came away with a handy little chart (it shows that only 1% of marketing expense goes to the internet which generates 12% of calls, as compared to 56% of marketing expense to print resulting in 8% of calls). Nacht asks the question:
Why are companies spending 56% of their money on an activity that produces just 8% of inbound calls? I don’t think Allan was joking when he quoted a Realtor as saying, “we’re spending millions of dollars offline because we can afford it, but our stupid competitors can’t, and they’re following us anyway.” Interesting strategy but it does almost sound like he’s kidding, doesn’t it?
Unfortunately, most sellers are still insistent on spending dollars on print advertising when it has been proven that the web is much more effective.