The trend has swept throughout the United States real estate industry and is now building up a head of steam to repeat itself in the South African real estate arena. Perhaps not with the same swiftness, but the grass root conditions have been generically laid for a similar local replication.
Driving the swing from property print advertising to electronic marketing is estate agency running, or should that be runaway, costs, which are increasingly under siege from lower sales volumes and competitors prepared to sell their services at suicidal commissions.
The stage is also being set by a market steeling itself from prospects of higher rates and teeth-gritting homeloan credit controls, both of which promise combining into further market sobering for at least the duration of this year.
Adriaan Grove claimed this week that the swing from print to electronic had already surged with interest for space on his two property portals having doubled in the last two months over the same period of last year. More interestingly, whilst his sites, which were single-handedly blasted into cyberspace by Grove some four years ago, being used mainly as a back-up to print, the emphasis on the medium is now for primary marketing.
But while Grove supports both the cost and higher penetration logic behind the trend he says the average estate agency is still failing to understand that successful website promotion in today’s market is far more complex that simply uploading homes for sale on sites.
Grove, MD of Entegral Technologies, the company behind property portals, MyProperty and MSN property, insists that primary in today’s cyberspace success involves search engine marketing (SEM). “Search Engine Marketing is a form of Internet marketing that aims to promote websites on search engines to the top or at least domination of highly visible positions. This can be achieved through search engine optimisation (SEO) and paid placements.”
SEO is the process of improving hits to a website from search engines for targeted keywords. Various methods are used by web developers to achieve this, which is a science on its own and takes time to master. Getting to the top of search engine results for popular keywords like ‘property south africa’ or specific keywords that combine the estate agents’ operating areas, he insists, is the ideal scenario and will drive thousands of visitors to that website.
Also of increased importance is that of paid placements. This is a product offered by most search engines that charges a fee for inclusion of a website in the search results for particular keywords. These paid ads usually appear on the right side of the search engine results as ‘sponsored links’. The most familiar tool is Google Adwords, Google’s paid placement product. Adwords allows subscribers to set a daily or monthly budget, define their keywords, target location and much more.
In this way, estate agents can easily target property buyers or sellers in a specific area using a set daily budget. When a visitor clicks on the ad, the advertiser (estate agent) pays a small fee and gets redirected to a specific page on their website. The ads can be changed online and therefore provide a way of testing responses to different ads – something that is very expensive and time consuming in printed media, and also difficult to track.
Grove says according to the New York Times, North American advertisers spent $9,4 billion on search engine marketing in 2006, which is a 62% increase on the previous year. Search Engine Marketing, he points out, is growing much faster than traditional marketing.
In South Africa, Grove says there has also been a rapid increase in search engine marketing across all industries including Real Estate.
“Four years ago, MyProperty was the first real estate portal to make effective use of paid placements through Google Adwords. At that time, it was cheap, and for a start-up internet company, the ideal way to drive additional targeted traffic to their websites. Today, an agency’s budget has to be at least five times higher than a few years ago since the clamour is for prime position supported by a willingness to pay top rates.
Grove predicts that search engine marketing this year, and specifically paid advertising, will receive huge attention from estate agents as an alternative to printed advertising. “With the recent scandal from the Media 24 group, where an audit revealed inflated sales figures for its magazine brands of up to 85%, many advertisers are now also looking at the Internet as a more reliable and accurate advertising medium,” he says.
“It’s no longer just a matter of time before the more entrepreneurial estate agents see the benefits of search engine marketing in terms of exposure and cost savings, that point has already arrived.”