Online Real Estate Advertising To Climb 15%

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With a slight but measurable uptick in home sales and new construction, the real estate industry is seeing something of a rebound in 2012. Still, Borrell Associates predicts advertising in the category overall will be down 16.4% from last year as media lags the sector's modest resurgence.

Online, however, will remain a bright spot, with ad spending expected to increase 15% to $13 billion, making real estate the largest online ad category this year.

Within the category, online would also account for more than half (55%) of ad spending, up from 40% in 2011. At the same time, real estate ad advertising in newspapers is expected to plunge 50.5% to $3.3 billion, or about 14% of total spending in the segment.

By 2017, Borrell projects that online real estate advertising will grow to nearly $14.5 billion, an increase of only 11%. That's because real estate was one of the first industries to exploit the new medium and most of the major growth has already taken place. The bigger changes will involve how monies are allotted within the category.

This year, the largest share of real estate-related spending online will go to email, at nearly 29%, followed closely by targeted display advertising (25.7%). Then comes paid search (17.7%), run-of-site display (15.8%), video (10.4%) and audio (1.5%).

In five years, however, Borrell projects that targeted display will surge past email to be the primary ad format, making up nearly half (47%) of ad spending, with the share of video advertising doubling to 22%. Both ad types are expected to flourish as real-estate advertisers turn to emerging platforms, like social media and mobile, to connect with prospects and improve ROI.

An estimated 62% of real-estate agents maintain a social site, with an average of 535 friends and followers each -- a third less than the typical small and medium-sized business. But the local media research firm expects social to play a growing role in advertising.

On the mobile front, agents are early adopters. They are 38% more likely than the average SMB to have used mobile marketing in the past year, and 53% more likely to be planning use before the end of 2012. Falling costs and off-the-shelf solutions should help more realtors establish a mobile presence in the coming years.

“The agent of the near future is likely to be the most socially-savvy, mobile-connected business in town,' stated Borrell's 2012 Real Estate Advertising Outlook report.

When it comes to real estate sites, Realtor.com is expected to be the top player with revenue of nearly $200 million. But Zillow.com is gaining fast, with revenue up 74% this year and traffic up 38%, according to Compete. Zillow was the most visited realty site in June, followed by Yahoo Real Estate, Trulia, Realtor.com and Homes.com.

But Yahoo, Realtor.com, AOL Real Estate and Rent.com have all seen traffic fall off in the last 12 months, with AOL suffering the biggest decline, at 45%. By contrast, Trulia and Homes.com, along with Zillow, are on the upswing.

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3 comments on "Online Real Estate Advertising To Climb 15% ".

1. Dave Kohl from First In Promotions
   

   commented on: August 16, 2012 at 4:30 p.m.
   What makes this even more interesting is the number of realty agents that don't understand how to benefit from online advertising. Many fail to update photos and information, a result of being used to "one ad fits all" for a property. I have found photos of homes for sale with snow on the ground during June, for example. Hopefully agents will realize that the purpose of online advertising of specific properties is to get the property sold and not just to please the seller.
2. Matteo Pantalone from Total Property Listing Engine
   

   commented on: August 17, 2012 at 8:43 p.m.
   I'm surprised how that email represents the biggest proportion of a realtor's ad spending in dollars. This kind of research usually measures pure monetary outlay; it would be interesting what the costs for each mode of advertising would be if an a real estate agent's time was valued to represent a real cost.
3. Gary Truck from Real Times
   

   commented on: March 25, 2013 at 8:08 p.m.

   Great Article, Caroline, thank you for sharing. Another thing to consider about Real Estate advertising is finding different kinds of resources where you can showcase your Real Estate Listings, like WPC (World Property Channel). They are global so you can get new eyeballs on your listings and perhaps find new seller prospects as well. Nice alternative to the usuals like Zillow, Realtor.com etc.  Best, Gary

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