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Why Real Estate Classified Ads Are Here To Stay (For A While)

By Lenny Gurvich

Real Estate Agent with Keller Williams Realty Tampa, Florida

December 01, 2006 12:17 AM

The Sellsius Real Estate Blog recently featured a video of an interview with the CEO of a home listing web site in the Netherlands. The CEO of Funda.nl, Marque Joosten, states that classified newspaper ads for real estate are, for all practical purposes, dead in the Netherlands.

These things we know:

Circulation for both of Tampa Bay’s major newspapers is down.
The internet is increasingly the medium where buyers begin their home search.
Internet advertising is much more interactive and cost effective.
Internet home ads are far superior to what can be done with print.
The effectiveness of internet ads is much more measurable than print ads.

So why does the Tampa Tribune have still have 4 sections of the classified ads Home Seeker section on Sundays?

Many sellers (FSBOs) just don’t yet know how to utilize the web.
Many brokers just don’t yet know how to utilize the web.
Many agents just don’t yet know how to utilize the web.
Many buyers just don’t yet know how to utilize the web.
Newspapers have traditionally been the tool for finding homes for sale, open houses, etc.
Americans aren’t as web savvy as the Dutch
Americans are more resistant to change
Sellers want to see their homes advertised in print
The Tampa Tribune has an excellent classified RE ad sales team.

So how much longer do we see classified advertising of homes in our local newspapers? As long as there are eyes looking at those papers, it will be an effective place to advertise as long as it is cost effective. Cost will certainly have to decrease as circulation drops.

Mr. Joosten notes there are only “two or three” classified home ads in the Netherlands papers. Opportunity? Depends on how many people are still looking at that paper. Any classified ad that I place always contains a unique URL to view the home on the web.

I don’t see classified newspaper advertising going away that quickly in the USA. But as home buyers increasingly turn to the internet to look for homes, and sellers, agent and brokers learn to better utilize the technology, the value of print ads will fall. Prices will only be able to go so low until it is no longer cost effective for the papers to sell and print the classifieds. What do you think? Five years? Ten? Time will tell.

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Chris Tesch

RE/MAX Bryan-College Station - College Station, TX

College Station, Texas Real Estate

Currently newspaper ads are our largest budget item, yet the item we get the least return out of. We have visited and revisited this fact but the fact is, the sellers want their house to be in the paper. It's going to take a long time to get them past that.

Dec 01, 2006 12:24 AM

John Hruska

Homes Charlotte, LLC - Charlotte, NC

I use to be part of an office that required all agents to donate a fee to a monthly advertisement. I guess it could make the phone ring if you believe in floor time. I never reall saw a good return for the investment.

Dec 01, 2006 04:07 AM

Anonymous

Post-Katrina, in the MGC, many folks were without computer access, especially reliable, consistent access--classifieds were ever so valid. It seems less so now that our area for the most part is up and running again. I have folks in the same town calling from a realtor.com listing . Granted, they are usually younger.

I have encountered both buyers and sellers lately however that do not have email addresses, Internet Access, nor do they care to use computers. Being an E-PRO, its sometimes difficult to understand that even some R. E. Agents fall into the same category. Yes, believe it or not I have been in transaction with agents who do not use email.

So, given the fact that people still call off of listing signs and from magazine ads, I would say that classified in the daily news is in my budget. I think if we do not use daily NP we will be missing a market. Could it be Seniors?

Dec 01, 2006 04:37 AM

Leigh Brown

Leigh Brown & Associates, RE/MAX Executive - Charlotte, NC

CEO, Dream Maker - Charlotte, NC

good points. especially that all agents aren't yet online-which amazes me-but still means that we have to compete with that old school mentality.

Dec 01, 2006 04:38 AM

Sean Carroll

The Get Off Your A$$ Academy - Manhattan, NY

Real Estate Speaker and "Expert" Coach

I am letting sellers know on the listing presentation that classified ads will generally not be much of a part of our marketing efforts. I will do them for open houses only, and even the internet has taken over for searching for those in our area. I like that FSBO's still use classifieds, because it makes it easier for me to find them and call them to preview their homes.

Dec 01, 2006 04:50 AM

Michael S. Mackey

CENTURY 21 All Islands - Mililani, HI

REALTOR ABR, CRS, GRI, RSPS

Eventually, even the newspapers are going to have to give up the print format!

Dec 01, 2006 04:57 AM

Scott Daniels Florida Real Estate 2.0. Agents Earn 100% Commission.

Florida List For Less Realty, Inc. Broker/Owner. - Cooper City, FL

Interesting almost 40% of our business can be attributed to some form of classified ads.... Our rental division agents do extremely well with classifieds...

Dec 01, 2006 05:22 AM

Tony and Suzanne Marriott, Associate Brokers

Serving the Greater Phoenix and Scottsdale Metropolitan Area - Scottsdale, AZ

Haven Express @ Keller Williams Arizona Realty

In the UK at least one newspaper eliminated their entire print division and is now strictly online. They initiated the change - choosing to force the issue with their consumers. Admittedly they serve a niche market - but still a gutsy move.

Dec 01, 2006 06:06 AM

Eddy Martinez

Nationwide Funding Group - Highland Park, CA

most customers prefer online information. The more savvy clients do extensive research in regards to local real estate.

Dec 01, 2006 06:35 AM

Yael Warman

Right About Real Estate - Dania Beach, FL

I am all for technology, so it is hard to understant how some people still don't have an e-mail address or internet access. I actually came in contact recently with someone that had no e-mail, no computer at home or office and NO CELL PHONE!!! How can they manage???
I guess this proves your point that as long as there are low-tech folks, there will be low-tech media.
The important thing that we need to do as brokers / agents is to cater to our target market using both low-tech and high-tech so nobody misses our advertisements.

Dec 01, 2006 08:18 AM

Tim Maitski

Atlanta Communities Real Estate Brokerage - Atlanta, GA

Truth, Excellence and a Good Deal

The most cost effective way to use classifieds is to drive people to your website. Use some sort of headline like "Free MLS Search" or "Search over 100,000 homes" or something better. If your site is sticky, you have a much better chance of converting than if they had called you about a specific home. Also, free recorded message hotlines work well too. It gives you an opportunity for say a lot more than what you can say in a classified and people are more likely to call a recorded message than an agent. I haven't advertised in the paper in years because it's just so darn expensive and I never get good results. A $300 ad might get 5 calls. Compare that with a pay per click campaign. At even $1/click, that's 300 people getting a look at your house for the same $300. I ask my clients where they want to spend their limited marketing dollars most effectively. I've never had them insist on classifieds after I explain the costs to them.

Dec 01, 2006 08:39 AM

Suzanne Marriott

Keller Williams Arizona Realty - Anthem, AZ

Associate Broker, CLHMS, e-PRO

Print media is dying off - but I bet you won't hear anything from the media about the bursting of the print media bubble!

Dec 01, 2006 11:06 AM

Netta Blackwood

La Rosa Realty - Kissimmee, FL

REO/BPO Expert

I'm still a supporter of the newspaper ad too as well. Sometimes we forget that not everyone uses the computer. Those were some good points that you made. I have an exclusive section in one of the local newspaper. It works for me.

Dec 01, 2006 01:11 PM

Jeff Turner

RealSatisfied - Santa Clarita, CA

Continuing to use classifieds because the sellers want them seems borderline crazy to me. I spent 15 years working closely with the newspaper advertising business, so I have many close contacts. I have spoken with several top newspaper advertising executives (who I will not name) in the past 6 months and they all say the same thing... "the only thing keeping our real estate sections alive is consumer perception. The reality of the numbers don't add up."

Why is the seller driving this behavior when their own behavior contradicts their desire? Last year's NAR survey found that only 3% of home buyers surveyed found the home they eventually purchased based on an ad in a newspaper. 3%.You need to know exactly what percentage of your leads are coming from the newspaper and make sure you're not spending more than you should. If 10% are coming from newspapers, then spend 10% of your budget. But don't spend 75% of your budget for that 10%!

Tim Maitski and Sean Carroll are on the right path. It's your job to educate the seller and let them know you are going to use the most effective tools available to market their home and that newspapers aren't one of them.

Dec 01, 2006 05:58 PM

Anonymous

joseph ferrara.sellsius

As with any evolution in technology, it is a gradual process. Newspaper ads still have their place but it is shinking. Newspaper ad cost is also a factor. Once the number of newspaper ads diminish to a certain point, they will become a useless venue. Perhaps newspapers will start giving away small ads for free & charging for larger, enhanced, ones. This would be a marketing strategy similar to that used by Craigslist. As you all know , Craigslist is free for many ads (to get content and eyeballs) & then charges in select markets. Hmm.

Dec 02, 2006 01:54 AM

#15

waey wyqw

wyq34y - Dell, MT

There is a segment of the population that doesn't know how to use the Internet and prefers print over digital. They still pay bills with checks and read the local newspaper.

For the foreseeable future, newspapers will have this niche market to target. Unless newspapers find a way to incorporate free (or at least low cost) online classifieds into their business model and add value to their offering, they will have a slow agonizing death.

Aug 28, 2007 12:10 AM