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Why newspaper ads will eat your budget for little return

It pains me to say it (more on that in a moment), but newspapers are dying and from a real estate point of view, are already dead.

Realtors know that more than 80% of buyers now look on line for homes. They want to search neighborhoods; they want good mapping; they want great virtual tours and they want lots and lots of pictures.

So I am really amazed to discover that despite this 80% figure, more than 75% of Realtors' marketing budgets go into print advertising. From both the realtors and the sellers point of view, this is a waste of time and money and more importantly, it won't get the home sold.

So why does it keep happening? There are still a lot of old time Brokers out there who stll train newcomers with the old way of doing real estate. "Go make this sub division yours" they tell them and including in this training about farms comes the way to advertise.

For some Brokers it's about money. You see a Broker might take a full page ad in one of those magazines that contains lots of pictures of fronts of homes and in order for this not to cost the broker a fortune, he or she will insist that the agents under him or her use the space to advertise their listings.

But the return is ever diminishing and will soon be zero.

Finally back to why it pains me to say this. For more than 20 years I was a newspaper journalist. I love newspapers! And newspapers can do things that simply cannot be done by TV, radio or even the Internet. BUT - we live ion a world of instant gratification and newspapers cannot compete with that no matter how hard they try.

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Please give me a call if you have questions about the Central Florida real estate market. You can reach me on 407 876 8200. Also visit my web site at http://www.simonconway.net/ or http://www.move2orlando.net/

Also remember to check out my weekly radio show - The Home Team - which airs every Sunday at Noon Eastern and if you are not in Central Florida then you can tune in on line at http://www.540wfla.com/

Posted by Simon Conway on 11/30/2007 01:44 PM

Comments (100)

simon conway, real estate, orlando, central florida, newspapers

100 Comments on Why newspaper ads will eat your budget for little return

NOV

2007

Hey Simon,,, My only comment on that is that the small classifieds still work, if you want to blow your phone line up... run an ad that says rent to own, 900 per month, ez qualify......

PS I have heard your Radio Show,,,, very good job Simon, very good job

Simon, among my peers in their mid-30s, I feel like a dinosaur since I still subscribe to not one, but two daily newspapers, The Washington Post and The Washington Times. Very few of my friends even get a newspaper at all. Lately, I have less time to read through both. Most of my news comes from online sources. And for real estate, I'd have to agree wholeheartedly that the newspaper is dying a quick death.

You are so right. Newspapers seem to fail us every time and the sadest part is, they don't even try. Their prices are ridiculous and they mark the prices up in the Spring here. As if they have any value....We've written them off for the most part. We will use them here and there to appease a seller that thinks they are still good.

Sincerely,

Kathleen

Mike - thanks for stopping by and for your comments both on this post and indeed my radio show. Perhaps a classified like that might still work.

I'd like to add my 2 cents, too :)

Newspapers can't have Virtual Tours either :)

I have to promote me too

Brian - I only read newspapers when I'm on vacation now. I hate that because of my background, but I too simply don't have the time. I want headlines, not stories and those are up to date and immediate on line. Very sad - also, very sad that you pointed out you're in your mid-30s. I'm in my late 40s! :(

James and Kathleen - nice to see you made it back safe and sound! Thanks for stopping by and I understand your frustration with newspapers. My only point to you would be don't appease sellers - educate them.

Mehmet - VTs are essential on listings now. Did you know that listings with VTs are viewed 299% more than listings without them on Realtor.com?

Newspaper ads are definitly a thing of the past as more and more people turn to the net for thier research and information gathering purposes. So, tapping into the power of the internet to attract clients is essential. The last stat I saw from NAR was that 85% of all people that buy a home do thier initial investigations online. Thanks to the online revolution, that number will fast approach 100%...so being able to capture them at that time will be more and more important as time moves forward.

Hi Simon ~

I run newspaper adds, but I'm not advertising homes. I advertise my web site with all FREE information "Tag Lines" to get them to my site and once there, they have to fill out forms to receive more info. It's gathering leads, if they don't want to fill out forms, then I don't want them as a client. They are not motivated!

Thanks for commenting RECR - nice way of getting a link to your site *lol*, but the point you made is indeed correct.

Paula - thanks for your comments. I completely agree with you about form filling.

Simon, it is a shameless attempt to promote my company, I admit. (Sorry, I couldnt resist...lol) But, the truth of the matter is that the conventional ways of attracting clients are no longer as effective as one would assume. You bring up a good point with the newspapers...dead. But, another example would be having a website. EVERYONE on the planet has a website. Merely having a website now is no different than having a FOR SALE sign...everyone has them...they are stacked up on hosting sites like cords of wood. It's how you promote your site and yourself that makes the difference. That is how you stand out in an internet-ruled world.

RECR - you can expect a comment on your blog from me today *lol* - once again, you are correct. I used to have a template site, but I massively upgraded to a custom built site and my rankings are fantastic. Number 1 natural placement on numerous key search terms - and THAT my friend is how you do business in today's market.

I have had some good success with simple line ads and open house line ads in the local newspaper. Aside from that I do not spend my hard earned marketing dollars on print ads.

Hi Erin - I'm surprised you are experiencing success with Open Houses - and if that is not the case, then you are in fact still not getting a return.

I don't place ads in our metro area newspapper any more, but there is one county we service that is more rural, where I still get a healthy return on my ad dollar. So our print marketing a very small percentage of our budget now.

I agree that the classifieds still work great with Lease Option properties. I would never advertise a listing for sale there now, unless the client insisted and paid for it.

Simon,

So true, folks are online. The more photos that they can see at once, the better.

small classifieds are the only way to go if newspaper advertising

Simon:

I couldn't agree with you more on your comments about newspapers. Technology will eventually move everyone away from them. Sad to say as I have very good friends who own newspapers. It seems like the fonts get small, the quality goes down and the cost go up! Our advertising budget in 2008 is going to be more focused on internet marketing than print marketing. We need to really educate our sellers about the value of internet marketing. Katie Karczewski www.Katie-K.com

Simon-I think if you poll the Gen X'er and whatever the latest group might be called you will find that for the most part that print (newspapers) are not how they get their information. On-line certainly is the leader for them. However the boomers (yep I'm one) are more likely to at least pick up a paper. However after analyzing my leads for the last 18 months I can say for me that print has brought ZIP! So guess where my resources are going next year......100% on line...

Simon, I recently terminated a listing because the seller, (who was a real estate agent in another state)wanted print advertising and I was not willing to waste the money on it. There were other factors involved also but she gave me grief because I would not advertise in the real estate books.

I personally have not taken the newspaper for several years now. I don't even remember exactly what the article was about that got my back up but our paper tends to have a liberal slant and they did something that ticked me off. I have not missed it at all.

Michelle - that sounds perfect, but the question remains is why are Realtors as a whole spending 75% of their marketing budgets on print?

Every month seems to have some "Awareness Month", go ahead google that. We as realtors should have a "Newspaper Awareness" Month, and start a grass movement where no one advertises in Print! Lets start with this January 08! Spread the word, via interent!

As an I.T. Director for a real estate company I can tell you that management and myself have brought this topic up time and time again. Unfortunately time and time again the single biggest excuse I hear is that "our sellers want their home in the newspaper". Also, when your major competitors still post full page COLOR ads in our local papers, real estate weekly magazine, and other print sources....you're left with little choice. Also, our demographics are much older than most areas. Pennsylvania I believe is the second oldest state in the country.

Personally.....I never EVER read the paper except when I pick up my morning coffee and glance at the front page of one on the floor of the gas station.

I think the key is changing the way agents sell the listing presentation to the seller. You need to convince the seller that newspapers are a waste of time and money. Unfortunately, that's easier said than done, especially with the older generation of consumers and many agents in this business who are WAY past their prime and refuse to adapt to the new way of the world.

Karl, Frances and Brett - thank you all for stopping by and for your comments.

Katie - the death of newspapers - because I really feel this is what we are witnessing - will indeed be a very sad day. But from a real estate point of view, they are already dead.

Simon - maybe the answer is that the vast majority just don't know any better or maybe they are not confident enough in their online presence to convince their seller's that it (newspaper and print ads) is just not beneficial anymore.

I think those of us that participate in Active Rain, Facebook, have personal blogs, etc are far ahead of the normal curve for agents these day. A static website just doesn't do it anymore and not enough agents have fully embraced an online presence.

Cindy - wow! 18 months and zero return on your newspaper advertising says it all.

Marchel - the liberal slant is another thing. When I was a newspaper journalist and editor, I would have fired anyone for putting any kind of slant on a story. I only read papers on vacation now and those are the ones that come free to my hotel room door.

Simon - As you are aware, I have newprint in my blood. I think we as a country have lost a great deal in the transition from reading complete stories written by true journalists to absorbing the soundbites offered by the talking heads on the multitude of cable channels.

As our desire to know the whole truth evaporates into a distant memory, it is of little consolation that our brave new world will be glitzy, on the edge, accompanied by a relevant soundtrack and rather hollow.

Keith - NOOOOOOOoooo!!! Frankly the more Realtors in my market that advertise in newspapers, the happier I am. I know they are getting zero response and that just makes me look better. :)

Nick - I feel for you my friend. The older generation will be wanting print. The agent who is afraid of losing the listing will say "sure". The agents who will ultimately succeed in your market will be the ones that refuse to be told where to spend their marketing dollars.

Yup- newspapers- out, internet-in!!!

Simon, Seems like it comes down to sellers being the driving force behind print marketing.

Michelle - you are 100% correct.

J-Mac - I agree with you as well as I too have newsprint in my blood. the first paper I worked on was produced on a flat bed press. It was extremely common to have printing ink in my hot tea! I was 16 years old. The passing of the newspaper which has an ability to truly examine a story form every angle something TV, radio or even the Internet are unable to do), is an extremely sad thing. BUT - this is about Real Estate and print marketing and on that level only people with money to throw away are going to continue to use this media for much longer.

Ads generates a lot of realtors calls if you ommit to mention"Broker". You pay and you receive a lot of realtors calls trying to get listings.....

Good post, thanks Simon

Point well taken. The percentage of buyer's looking in the newspapers is dwindling daily. Using the internet is the key.

Simon-Great post. My hubby Steve and I have always told our clients that newspaper advertising does not work!The only reason we would put in an ad is for the seller's ego. In 2004, we shifted our advertising budget and did a test run using newspaper advertising and a certain home magazine to advertise our properties for one year. The conclusion was that is made absolutely no difference in our annual sales. And we received less than 5 calls off those ads. Yes, of course we ran a compelling 3/4 page ad and tested it for effectiveness. Now we simply will not work with someone who insists we place weekly ads in the paper. We use our marketing budget for more cost effective marketing where the seller gets a bigger bang for the buck! It certainly does not help when the media is showing gloom and doom real estate articles on the first page of their newspapers! Welcome to my World! Diana

I must agree with you on newspaper ads and little return. Several years ago I could expect several calls from a week end of ads. This year my experiance is 0 calls on a $150 ad....the problem is still the pressure from the sellers to see their home in the paper.

I like newspapers for the sole purpose of brand awareness, not lead generation. From a branding perspective, I can still create impressions by advertising in the paper, but I will spend far less on print than online. It's about an 8 to 1 difference, compared to online, for obvious reasons.

Simon, the average newspaper reader is 52 years old, average age of the typical Realtor is 55, the average age of last years home buyer is 34.

I think that print ads still have their place for now. Not everyone is an owner of a PDA. Many people, young and old, still get the newspaper to take with them to view properties and jot down notes on them. I;'m sure that this will change as technology evolves. However,. with the point that you make should cause hard copy publishers reset their prices to reflect the less effectiveness of their medium. Unfortunately, they haven't lowered their prices to reflect this.

Simon, What, no newspapers ads? No open houses? How will I ever appease the seller? What if the seller insists? What if I'm not skilled enough to educate my seller about what DOES work opposed to what doesn't work?

I haven't used newspaper ads in years, except for some rentals ads. Sure some sellers wanted it, but I was able to educate them. This year I have discontinued the real estate magazine ads as well. What I have done is beefed up my online marketing. Because I can show the results from my internet strategy not one seller has complained.

Congrats on the feature.

Craig's List is taking over the classifieds, In the paper today there was only a few pages of Ad's. Some people in my office are not Advertising in the Paper because of all of the Negative Real Estate Stories that they print.

Jane, you really pushed my button. I get so mad when I read a negative real estate story in the section where the paper is charging us an arm and a leg for ads. There is always some good news in the story but the headline always stresses the negative...... : (

Simon,

I just canceled my newspaper subscription, I was getting tired of paying for them to go in the recycling bin unread! :)

Pretty funny, I just received an email flyer that stated that 88% of consumers prefer to shop for their real estate on the web!

I haven't sold a property out of a print ad in several years now. Just a big waste of money. I have had some good response to my rentals from print ads though.

I think that some agents still use the newspaper to show sellers that they are actively marketing their homes. (What seller wouldn't want to see a picture of their home in the newspaper if there is the slightest chance of the right buyer seeing it).

Also, agents use the newspaper to market themselves (i.e. to get their names and pictures out to the masses.) While online is great, some people do still read the newspaper as part of a weekly or daily routine.

Space ads don't work well enough for any return on the dollar but classifieds can still have impact -mainly because these are picked up online......

I got a $3 Million dollar client and another $3 Million in referral business... all from a $11 Washington Post ad.

I would think that is a pretty good return!

You?

So why not make your ads SMALLER and just buy the county you live in.

Frank

I dropped the color magazines a few years ago because they didn't help sell homes. Newspaper ads are going to be out for 2008. They are just too expensive and do such a bad job with printing - out of register, inaccurate color, etc. They certainly don't present the home at its best, even though the jpg is high quality.

I've noticed that the agents who still buy the full page ads are those agents who don't have good online presence.

I worked for a Homes magazine for 8 years and feel as you do, somewhat conflicted about seeing their decline. There are some newspapers and magazines doing a pretty good job at combining the website and print coverage. This is the perfect time of the year for agents to be looking at where they got this year's clients and reapportioning their money for their 2008 budget!

even though your points are valid there is still are still reasons to use the paper. classified ads work. they are cheap and people read them. the sunday paper. i don't know one person who doesn't get the sunday paper. if they see a home in the it will often trigger them to go to the web site to view the home. its also a good place to advertise your web page.

In this 21st Century, Instant Gratification world, newspapers are still a great source for the funny pages, but unfortunately, when it comes to marketing, they just don't stand up anymore. You can still do some shotgun marketing that way, but it's hard to achieve your ROI, and you have to slog through a ton of lookie-loos to get to the one pearl!
While there can still be some traction gained in some markets, most of the time the effort to make sure that what you want printed gets printed where you want just isn't worth the effort.
Thanks for the insightful post Simon!

Simon - what is it that newspapers can do that the internet can't do - as far as information, that is?

I haven't advertised in newspapers for years - I show sellers my results from when I did advertise, the results from colleagues who do still advertise, and the national statistics. If they still want newspaper advertising they can either pay for that in addition to the commission, or choose another agent. I don't need clients who insist I spent my money on things that do not get results.

Too bad the sellers think the buyers are coming from the ad in the Sunday Homes Section. Their perception is their reality. I've sold homes with 0 print advertising but some people are not ready to hear that yet.

I agree with the thing about the paper wants us to pay $#@&! and then they want to trash us whenever they get a chance!

I agree mostly, but always allow a portion of the budget to be for print. TONS of people still read the paper and week after week flipping over your face and ad will make some sort of impression. Also, for how cheap classifieds are, I sure benefit from the rental calls.

Wonderful points, thanks for the information.

I've occasionally taken an add....when the newspaper crawls to us with a great deal, a couple bucks per add space. Otherwise, nope!

I have run one ad in three years in the local paper in the real estate section. I did run an open house in a Saturday section earlier in the year and got 15 people to an open house. It was an ad, half a page with all agents having open houses. So it will not work the old way but for creative things it may work. Eric

Simon,

I have never run a newspaper ad, internet only...as always, great post. Congrat's on the feature.

Simon: Good points, If you must advertise make sure Alexa.com ranks the web version of your ad.

Simon, we only use print media for our auction ads. Those do get responses but it is a much more targeted ad. Even that is starting to take a backseat to online advertising. We have also found email campaigns to very effective.

Excellent post with great information. Valuable comments. Thank you!

Maria - good point! A good warning for all those still using print.

Robert - we are on the same page so to speak. Thanks for your comments.

Diana - I am not suggesting a boycott because I don't like the spin they put on housing - I am merely pointing out that the return on investment is next to zero if not actual zero yet. Thanks for stopping by.

David - seller education is what you are talking about and frankly if they are not prepared to be educated then you must be prepared to walk away from the listing.

Sean - how much are you spending on brand awareness in a media that is increasingly not read by the vast majority of home buyers?

David - the age demographic is huge! Thanks for pointing it out so well.

Terry - They can't lower their prices because advertisers are waking up. SO they have increasing costs (paper is more expensive due to the environmentalists closing down our logging industry) and advertisers are fewer therefore they need more of them.

Dan - nope! No Open Houses and no newspaper ads. I thought I'd spend the money on a fishing trip! Thanks as ever for your comments and you are of course correct - seller education and being firm about what you will and will not do are the keys.

Jane - yes, Craigs and others are doing a reasonable job. Thanks for your comments.

Suzanne - I haven't had a newspaper delivered in six years. I only read them on vacation if they magically appear outside my hotel room door!

Frances - that number would not surprise me!

Rob - that too does not surprise me. Thank you for your comments.

Darleen - look at the demographic. The people reading papers are not the same ones who are buying houses.

Julie - in other words you advertise in a newspaper to get a spot on line.

Frank - if true then you are most certainly a huge exception these days - unless of course you are talking ten years ago.

Elaine - that is perhaps because they realised too late. It takes a long time to get the right website and the right ranking.

Joeann - there are some that do a good job of combining the two, but the web is so much more important than the print and I find that the positioning of these sites is not that great.

Trevor- you don't know a single person who doesn't get a Sunday newspaper? Meet one! ME. And of the 70+ comments here I'm pretty sure you are also meeting another 50 who do't either. Why is it a good place to advertise your web page?

Tim - you do highlight another problem. Color registration on fast running presses has always been a major problem on low quality newsprint. Also the production teams don't have the time to put it right because the paper has to get off the press on time and they typically have A LOT of pages to check.

Sharon- newspapers can get really in depth into a story - giving over lots and lots of column inches to explain all sides of an issue - this is something TV doesn't have time for and intyernet doesn't have the attention span for. I will miss newspapers when they are gone - and gone they will be in our lifetime I think. As for the advertising side - I agree with you 100%. Thanks for stopping by.

John - you must educate them or be prepared to walk away - or do as Sharon does - you want it in the paper? Then that is a cost over and above my commission because I know it doesn't work and I don't see why I should pay for something that I know does not work.

Chris- hey I invented a time machine that doesn't work and I want $1 million of your money for a ride in it? NO? Ok then, give me $25 and you can still have a ride in it! I'm not being mean I promise you, but if it doesn't work at $100 then why would it work at $1?

Eric- was that the ONLY advertising for the open house? And even if yes, is 15 people a good return for how many homes? And REALLY - don't get Dan Forbes started up again on Open Houses! Or maybe you should and you should certainly check out his blog on the subject!

Karen - thanks so much for your comments regularly on all my posts. I really appreciate you taking the time to stop by.

Gary - thanks for the info!

Melissa - interesting on the e-mails because I get so many of them these days I tend to trash them without reading them. Thanks for your comments,

Denise - thanks for stopping by

I made sure to highlight this today in a listing presentation. Put a fork in it, it's done!

Thanks for stopping by annonymous! Hope you got the listing.

Agreed, print is dead. It is a waste of money.

People are still reading but online instead of print:)

Anne

DEC

2007

A cheap ad pointing readers to your website could be a good alternative...

Simon, I believe that you are right on the money. Unfortunately, in my area, local newspapers are finally after all these years making a big push into the online space, realizing that their real estate section is dying on the vine. I don't like the new competition!

I must agree, it is a waste of time and money to run real estate ads in the local paper. I have a client that absolutely insisted that I advertise her property in the local paper....she felt like it would attract a certain audience that did not use the internet. I warned her that the ad would not be effective and the cost was outrageous. I ran the ad, and "bingo" not the first call. What more can I say!

The internet is becoming one big newspaper for us all to advertise in. Becoming? I should have said "has become". Although there are those select few who do not own computers and still love reading the newspaper, like my father for instance. I have been trying to get him to the internet for a few years, and no go.

I have become a big fan of the internet for advertising, but I would not put all of my eggs in one basket though. I did want to defend newspapers a bit (since I still love to read mine). Zillow has worked out a deal to post newspaper ads on their site. Newspapers might not be dead yet. They are struggling, but they are looking into ways to keep up.

It seems to me that buyers look online to scout out houses but may still use the Sunday paper to see quickly what open houses are being held in the town(s) they're interested in. The usefulness of newspaper advertising has definitely become quite low.

Secondly, why should real estate agencies subsidize newspapers that are daily beating down the housing market, hitting buyers and sellers over the head with gloom and doom, telling readers that this may go on with no end in sight - a self-fulfilling prophecy that affects the livelihood of all realtors?

Amy

I wondered how effective newspaper ads were. I have never used them, as a new agent, I jumped in with internet, etc. for marketing instead.

Thank you for the insight.

Heather in Indy

Classified ads--now they seem to work pretty well. I think it is alos an issue of so many real estate ads--lots of clutter in one place--

Have you found that they are getting much more expensive too? As for customer service, that is another matter altogether.

Simon - The only newspaper that comes through our door with any consistancy is the local ones no Toronto Star, Globe and Mail, Wall Street Journal or any of the other national papers. We utilize our print adds to promote our web sites as well as the property when we do use print adds.

The newspaper's overhead is what is going to kill them. I can buy a small, four line ad that runs for one day(!) for roughly $40, or I can pay the same to have my website hosted with an IDX system for one month. I've been so frustrated talking to the salespeople at our local newspaper that I refuse to use their services for anything.

DEC

2007

Although I do read the local newspaper every morning I don't run ads in it. Price is WAY too high for the return.

Congrats on the feature. It is sad that so many agents (and companies) continue to same things they always have, paying no attention to changing times. I agree it is our responsibility to educate our clients about how business is conducted today.

I've been saying this since 2004, I rarely ever, ever, ever use print media.

I have had a busy week - thanks to all the people I have not responded to individually. It seems that people here at least agree. So which Realtors are spending 75% of their marketing on print? I guess the ones who think Active Rain is a heavy storm!

DEC

2007

Subscriber numbers speak for themselves. I just wish consumers read the statistics. Unfortunately, I doubt it will be the newspapers printing them.

Alayna - that is a real number - 75% of Realtor marketing goes on print that nobody reads. The public needs to know.

Your right but I find it still useful to place ads in papers and magazines as it comes in handy during the listing presentation when others have already abandoned that medium.

Take care!

RJH

Thanks for your comments Robert, but seriously what you just said was I was right, but it was great in listing presentations because you can show potential sellers that you are doing something YOU KNOW doesn't work. Clearly you're not telling the potential sellers that.

DEC

2007

I think selling 'For Sale by Owner' is the way to go in this market. I currently am selling FSBO and having better success with leads vs when I was listed with a broker who dragged me along for 6 months. Who knows in this market. I currently have my place listed on ForSaleByOwner.com, BrokerFreeRealEstate.com, and Owner.com....I guess the more the better. Any Advice on selling on my own?

Steve - I think selling "For Sale By Owner" is possibly the worst thing to do in this market, but you do need a Realtor who understands what's going on in your particular market and how to sell it. One thing you certainly need to do right now is to offer a commission to any buyers agents in your town so that they know you will pay them if they bring you a buyer.

DEC

2007

I have maybe received 5 calls from a home ad in the Newspaper in the last 10 years. I have received countless calls from web advertising, mostly form Craigslist and thats FREE1

Simon, it's very true that all the old-school training about "work your farm" and "make the neighborhood yours" is out of date. Mega-brokers love that sort of thing. Those companies sell franchises (by territory, of course) and the only way to make that work is to divide an area up in to little territories, each served by its own franchise. Things don't work well if an agent is stepping over the boundaries of their "farm".

Companies that buy full-page ads with dozens of listings have been doing it wrong for years. I see $200,000 cottages on those pages, right next to million-dollar homes. Open a copy of Town & Country or Robb Report. Do you see Rolex watches sold on the same page as Timex?

James - yes and there are other free sites as well as some that are worth paying for.

Eric - I LOVE my Timex!! Point very well made.

Thank you both for commenting.

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