If you are one of those many
agents or brokers who don't really believe that the Internet is "the way" in
real estate today, perhaps the following data compiled and presented by
Leslie Appleton-Young, Chief Economist and Vice President of the California
Association of RealtorsŪ (CARŪ) in her analysis of the Real Estate Market in
California for 2006 will get your attention.
If you believe that the Internet is the single
most important factor in your future success, here's your continuing proof
that you are correct. Ms. Appleton-Young and CARŪ have compiled data of such
import and enlightenment that I felt some of it should be shared with you.
Pages 62 - 82 of the study compare some distinctions between Internet vs.
Traditional buyers and the findings are powerful. These charts show the
undeniable trends and the clear preferences consumers have for the Internet
approach to buying a home: since the year 2000, virtually every preference
that used to favor the traditional approach has been turned upside down and
the Internet approach is now overwhelmingly favored. This report is
unequivocal evidence that if you are not on the Internet bandwagon and if
you can't be found by people searching for homes on the Internet, you are
completely "missing the boat" in the real estate business.
Here are just a few of the report's findings:
92% of Internet buyers found their agent
on a web site; 63% found them through an Internet search engine; 0% of
Internet buyers found their agent through brochures, flyers, yard signs
or mailers to their home (does this tell you to spend more on Internet
marketing and less on print?);
In 2000, 28% of people said that they
used the Internet as an important part of their home-buying and
selection process. In 2006, 70% said they did;
86% of home buyers started using the
Internet as part of their process BEFORE they started looking for a
specific home;the other 14% did after they started looking, but BEFORE
they contacted a real estate agent; that means that 100% of buyers
surveyed started looking at homes first, agents second. When you combine
that finding with the already existing one that fully 81% of Internet
buyers stay with the first real estate agent they choose to contact, you
can see a powerful case for being able to have consumers find you,
first;
Internet buyers spent an average of 4.8
weeks doing research before contacting an agent; traditional buyers only
1.7 weeks. That means an Internet buyer is better prepared and twice+ as
less likely to waste your time;
Internet buyers bought a home on average
after spending 2.2 weeks looking for a home with an agent; traditional
buyers spent an average of 7.1 weeks; How high would your productivity
be if you could spend 2/3 of the time you now spend previewing with
clients and could dedicate it to selling and marketing, instead?
Internet buyers previewed an average of
6.7 homes with their agent (they had already eliminated ones they did
not wish to see), traditional buyers previewed 15.4 homes; an average of
just under nine fewer wasted showings per customer;
Only 3% of all Internet connections
available at the primary computer used for the home-buying process were
dial-up: Internet home buyers and searchers are not sticking with
dial-up, just as they are not sticking with traditional methods;
The approximate distance between
previous residence and new residence for traditional buyers was 25
miles; for Internet buyers, it was 242 miles (you can sell anywhere
compared to traditional ways);
Number of agents an internet buyer
interviewed, on the median: 1; Traditional buyers? 3. (Why would you
want fewer auditions and more certain retentions?)
69% of Internet buyers said response
time was extremely important.83% of those buyers chose email as their
favored communication method with their agent. 0% chose "in person."
(The Internet is the new "office visit.")
Internet buyers were more satisfied with
their agents: 4.3 to 3.3 for traditional buyers, on a scale of 5 where 5
is "surpassed expectations."
35% of traditional agents listed "faster
response time from my agent" as the one thing they would change, if they
could, about their experience; Internet buyers? 0%!
Internet buyers were far more satisfied
in every important researched category of satisfaction than traditional
buyers were; when asked the number one reason for satisfaction with
their agent, 91% of Internet buyers said that satisfaction was because
their agent "was always quick to respond." Traditional buyers? Their
number one reason was "worked hard on my behalf", chosen by 62% of them,
leading us to conclude that traditional buyers did not find their agents
"quick to respond."
And, ladies and gentlemen (a little drum
roll, here, please), 97% of Internet buyers said they would use the same
agent again. Traditional buyers? 50%. (Twice as likely to be satisfied and
twice as likely to give a referral, wouldn't you think?)
I'm not an economist, (I don't even play one
on TV), but it seems to me that these data show clearly that:
Agents who sell via the Internet do not
get as bogged down in unproductive chauffeuring to preview homes as
traditional agents do;
Agents who utilize online marketing and
have Internet buyers are more liked, more highly regarded, more likely
to have a repeat sale with the client,
Agents selling to Internet buyers are
likely to work only 2.2 weeks with a buyer before selling a property
(vs. 7.1 weeks traditionally);
Agents committed to online marketing may
be able to expand their market area to an average 242 mile radius of
their location and remain effective due to online communication; people
find you on the Internet, call you or email you, and use you to help
them find a home in an area they may not know.
The money you may spend on brochures,
ads, newspaper ads, and the like should be reconsidered and placed into
Internet Marketing.
So, unless you are in a state of denial about
the Internet's importance to real estate transactions, you need to do
several things in your planning for this year, at minimum, if you want to be
on the right side of these statistics.
You need to take most of the money you
are spending on newspaper ads, brochures, glossy marketing pieces, etc.,
and invest it in your Online Marketing. Chances are good that you cannot
possibly wisely spend all those dollars online; consider those savings
as your bonus this year. It will be tough not seeing your comforting
listings in the paper, but think of all the money you'll be saving! (And
as more fuel for that fire, consider this: Ms. Appleton-Young's data
also show that over 70% of people 65 and older read a daily newspaper,
but only 35% of 24 year olds do. PRINT IS DEAD TO THIS GENERATION OF
HOMEBUYERS!)
You need your own website showing your
properties and you. You can get a very good one free. What are you
waiting for?
Just having a website or a page on your
franchise site won't cut it; you must be able to be found by people
searching for homes in your considerably larger e-neighborhood. The
Internet is a really big place and chances are that you and your site
may be lost in its hugeness. (Click here to find out if your site can be
found and how to make it found
http://TheBlackwaterCG.onelanding.com.)
You must be permanently committed to
"Thinking Internet." I have heard many agents say "I don't get that
involved with Online Marketing; I've been successful the traditional way
for 15 years." I offer those of you saying that now two things: my
sincere congratulations on your past success and my sincere empathy for
the frustration you will suffer as the curve gets further out in front
of you. The report told us that in 2006, 63% of Internet buyers (who
comprise 70-85% of all buyers today) find their agent on the Internet.
We believe that within the next two years, this number will approach
90%. While this CARŪ study does not report on every State in the Union,
it does report on what is happening in America's biggest and most
influential real estate market. No matter where you are, these data and
trends are coming at you. You must get on board or you will be literally
run over and left behind. Internet selling is the way, and within our
lifetimes, the statistics will continue to favor online marketing of
real estate in even greater proportions.
We at Blackwater and our affiliated
companies, Compass Internet Systems and Web Reporter Tool, talk to agents
from Martha's Vineyard to Hawaii, Maine to Florida, Texas to Canada and
everywhere in between on a daily basis. That will never make us as
well-informed as Ms. Appleton-Young, but I believe it gives us a good
perspective on trends in this area, and here's what we think: all over the
country, agents and brokers are showing interest in, adopting, and pouring
their time, effort and money into online marketing on a scale that was
unimagined only two years ago. That makes us certain that every professional
real estate sales person who wants to stay in this business must adapt to
Darwin's Law on its most brutal terms: Adapt, or die. In listing and selling
terms, that means that you must make the effort to make the Internet make
money for you, for soon, that is where it all will be made. Go to a search
engine, enter your city, state and the words "Real Estate" or "Homes for
Sale" or any other combination that describes what you do. Then hit
"Search." Are you one of the ten people listed on the page? Based on the
statistics you just read, if you are not that means there is a certainty
that the searcher will not buy a home from you, but from one of the people
on that list of ten; after all: "92% found their agent on the Internet; 63%
of them used a search engine." 63% of 92% of all Internet buyers means that
there's a 57% chance you are out of luck.
After years of evolution in the way we do
things, the pace of that evolution is increasing. This is the time to get
with the wave, this is not the time to miss it. As Eugene L. Meyer, former
Washington Post writer and editor recently stated in an online
article: "Search Engine Placement is Mission Critical (for Real Estate)."
I'd put it another way: "Internet Marketing is the future of real estate
sales." It's up to you: Stay where you're comfortable with Traditional
buyers, or move the cheese and learn how to get more Internet buyers. In the
long run, there will be fewer and fewer traditional buyers for you to
pursue, but more and more Internet buyers. It seems plain where you need to
be going!
Thanks to Leslie Appleton-Young, Chief
Economist and Vice President of the California Association of RealtorsŪ (lesliea@car.org)
for producing this information and being so cooperative in permitting its
publication, and thanks also to Andy Alexander of Shorewood Realtors in El
Segundo, CA for bringing this study to my attention (www.andy-alexander.com).
It was the excitement in Andy's virtual epiphany that got me onto this
report; because - as he put it: "I just realized I must do better in my
Online Marketing because that's where all the buyers are."
Andy, I couldn't have put it better, myself.
About
the Author: Mike Parker is a principal at the Blackwater Consulting Group,
Inc., and specializes in online marketing for business professionals. You can
reach him by e-mail at
mparker@theblackwatercg.com for a free copy of his booklet "Especially for
Real Estate Professionals: 15 tips to help your website make you money" send an
email to e-mail
realestate@theblackwatercg.com.
This article written by Michael E.
Parker, a principal at the Blackwater Consulting Group, Inc.. All rights reserved