Real Estate Really is Moving Its Advertising Online

October 16th, 2008 by roostblog in Industry News

I read a story earlier this week on Inman News that excited me just a little bit. The story “Online ad spending defies economy” written by Matt Carter provided insight into what real estate brokerages are doing with their advertising spend and the pattern it has been following for the last several years.

With the housing decline and the heavy usage of the Internet by real estate consumers, brokerages are finally coming to grips that they must use advertising sources that reaches the clients they are trying to secure and sources that they can measure. Will we ever see a day when there are no display ads in the local metro newspaper? I doubt it because someone will always see value in that medium, even if it can’t be measured.

I have to admit that when I was working on the brokerage side, our executives would always boast to others about our full page color ad in the San Jose Mercury News. But the fact is that real estate brokerages, and more importantly the agents that work for those brokerages, are finally seeing the value in online advertising.

Let me quote some statistics from Borrell Associates, the source that was used in the Inman article, to back my point about online advertising within the real estate space. Now with the downturn in the overall real estate market, the total real estate-related ad spending including not only ads placed on the web but in newspapers, television, radio and direct mail, is projected to decline by 2.2 percent in 2008 to $31.6 billion. But Borrell is predicting an 11.3 and 5.1 percent growth in online advertising for 2008 and 2009 respectively. What this says to me is that brokerages are taking money from ineffective offline advertising mediums and shifting them to more accountable online advertising sources.

And the numbers become even more staggering if we look at Borrell’s future projections. By 2013, they expect the internet will capture 33.1 percent of a projected $35.3 billion real estate-related ad spend. Compare that to the 2005 numbers of a 19.6 percent share of the $29.9 billion spend and you can see the impact online advertising is having on the real estate industry.

I’ve seen this coming for many years but it is awesome to see it coming to fruition.

Derek Overbey
Sr. Director of Partnership Strategy
Roost.com
derek.overbey@roost.com
@doverbey – Twitter

Comments Tagged in: , , , , , , , , , ,

  • Derek,

    It is awesome to see some hard statistics about the trend to online advertising. It's such an exciting time in our industry....I can't wait to see how things progress 5 years from now!
  • The Ann Arbor real estate market is very competitive with several top agents spending heavily online with pay per click, aggressive lead capture websites and blogging and social media campaigns.

    While newspaper - Sunday want ad - advertising is still somewhat important for branding, I would have to believe that MOST home buyers go to the internet to search for homes. Certainly everyone with few exceptions I talk to starts on line.

    The newspapers have been slow to work the online channel and are still behind the curve in this area. They could really bundle the online component better when they sell ads to real estate companies.
  • Yura
    Three years ago I sold my first home without any Net resources. But it was very difficult for me. I heard that some services can publish ads about my home in the Internet. Can you help me to choose between http://fizber.com and http://trulia.com ? Do you know anything about these services? My friend said that "Fizber" better than "Trulia". But maybe he wasn't right. So I need help.
  • This is a great day for Century 21! They're showing themselves to be proactive during what is a very challenging time for them. Many corporate marketing managers in traditional industries are unwilling to take chances in migrating more of their ad spend to online channels for fear of job loss in a tight labor market. Kudos to Century 21 for showing some courage in making a major move. It's a move in the right direction.
  • I'm agree with Tina. We can’t wait.
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