If you wanted to sell real estate in 1900, the most efficient way to advertise was to go to your local newspaper and create an ad. Everyone read the local paper. And newspaper ads worked. Go back in time another 100 years and newspapers were still king. Fast forward to the 1990s and the answer was still the same.
From the buyer's perspective, finding out about real estate was a hard job! You either had to subscribe to the local paper or walk down to your local store, pick up a copy of the paper and pick through the classifieds.
By the 1990s, US print advertising had grown into a $60 billion dollar industry, driving trillions of dollars of sales per year. Real estate made up a big chunk of newspaper advertising.
During the 20th century, direct mail, radio and then television came onto the scene, but newspapers still had the biggest, most reliable audience.
But in the late 1990s, something changed. As the internet started to become mainstream, look what happened in 2000: Newspaper advertising revenue fell off a cliff! And it never recovered.
The most amazing part is how fast it changed. And how few people needed to get online for print advertising revenue to collapse:
The collapse happened in 2000, when there were only 361m worldwide internet users, less than 6% of the entire world’s population!
What replaced newspaper ads? Google ads.
Look what’s happened since 2000:
Why was Google so successful?
Why was Google able to eviscerate the newspaper industry, a 200+ year old, long term trend, so fast? Because online ads allowed another level of targeting that previously wasn’t possible with newspapers.
Newspapers allow you to target an entire city with a shotgun style approach. Whomever happens to be reading the newspaper will see your ad. The vast majority of readers are not going to be remotely interested in buying your product. And many people who might be interested in your product won’t see your ads! Maybe they didn’t read the paper that day, missed the section where you'd placed your ad, or even worse, they just don't read that particular newspaper.
How is Google search based advertising different?
Google allows you to target people who are searching for keywords related to your product. And only pay when an interested person clicks on your link, or even better, takes an action on your page. This strategy is called intention based marketing. You only show your ads to people who have shown intent based on searching for your product.
As Google started to beat print, others realized that they could capitalize on the trend in an industry by creating "industry specific Googles" or capitalizing on Google's search. Real estate was one of the first industries to experience this shift as Zillow became the dominant force in the 2000s, allowing people to find properties on the internet and then selling this traffic back to real estate agents.
The peak desktop internet audience on Google and Zillow lasted from the 2000s until ~2013. But in middle 2000s the iPhone forever changed how the internet worked. Android quickly followed.
The pace of change continued to accelerate and by 2013, the internet went mobile. You'll notice this change by paying attention to the people you see walking down the street. Pre 2013, photos like this weren’t very common:
We’ve all seen it before. People are glued to their phones, not even looking up anymore. I bet we've all seen near misses like this before:
But cell phones with fast internet didn’t just change the screen size. They fundamentally changed how people use the internet! On desktop internet, people spend time in their internet browser, searching for things on search engines like google.
But the phone is different. People only spend 10% of their time in browsers. They spend the other 90% of their time in apps. And in apps, people don’t search.
So what does this mean? People aren’t searching on mobile. And they’re spending even more time every year on mobile.
What does that mean for real estate sales?
If Google, Zillow, Realtor.com and other search based services rely on people searching for things, but people don’t search on mobile, these companies have a big problem! Real estate agents have told us that these services don’t work nearly as well as they used to even three years ago.
In fact, they’re in big trouble. Since the peak audience moved to mobile, companies like Google, Realtor.com and Zillow have struggled to adapt. Facebook now sends more traffic to media sites than Google does!
When people are on their phones, they’re not on Google, Zillow or Realtor.com, they’re on social apps like Facebook, Twitter, LinkedIn, Instagram and Snapchat.
How do you target the peak audience on social media if they’re not searching?
The paradigm shifted from waiting for people interested in your product to find you toward pushing your message out to people who are likely buyers and sellers.
It's a massive shift: from intention based marketing to push based marketing.
Social sites like Facebook, Twitter, LinkedIn, Snapchat and Instagram allow you to target your message to potential buyers. You can target by demographics, geography, interests, relationships, credit scores, income, education and a myriad of other factors. You can even target people who are “similar” to people who you know are good customers!
You need to use push based marketing to reach the biggest part of the audience today. These are the people who are not searching like they used to. And as we’ve seen in the newspaper example, the new, better service can start to affect the competition much faster than most people believe. We’re already three years into this paradigm shift and that’s why we decided to start PropertySimple
We’ve given you the tools to take advantage of this paradigm shift without you having to become a social media push marketing specialist. If you’d like to learn more, please feel free to schedule a call with one of our PropertySimple experts and we’d be happy to help you out!