A recent study by Pew Internet and American Life Project, The Internet and Consumer Choice published May 18, 2008, revealed a startling finding about real estate consumers and the internet:
Only 11%* of those who bought or rented a home in the prior year say that online information had a “major impact” on their decision. 36% say it had a “minor” impact, while a whopping 42% said it had NO IMPACT AT ALL!!! (*23% of those using the internet)
Other findings:
- 49% used the internet* (conflicting with NAR’s 77%) but it was not the only source for information
- 49% read ads in the newspapers (who said print is dead?)
- 47% asked a real estate agent for advice*
- 31% ask friends, relatives and co-workers
*For those moving to a new city, 60% used the internet and 55% relied on a real estate agent.
Based on the study, real estate search on the Internet seems to be one of research:
- 57 % say it reduced the number of places they looked at
- 54% say they took a video tour of the house, apartment, or neighborhood
- 29% say they thought online information helped them save money on the house they bought or apartment they rented
A finding which did not surprise me was that after moving in, consumers have little need to use the internet (note to self: call Todd Carpenter):
- 5% discuss the new neighborhood in a forum or online community
- 4% bother to rate their agent (duh)
- 4% post comments on a blog about their new home or neighborhood
So, despite what they tell you at a conference, don’t put all your marketing eggs in an online basket.
[h/t Real Estate Marketing Blog]
[Methodology notes (see study for complete details): The study (real estate module) involved telephone interviews with 314 participants between August 3 - September 5, 2007. The median age was 32. 80% had internet at home (61% broadband). Sampling error rate: 2.3%, results error rate 2.7%. I’m not a statistician but the study is certainly subject to debate. Still, I do believe consumers are not as net savvy as we think they are: See Related Post below)
Related Post:
Real Estate Myths or What I Did on My Summer Vacation
Technorati Tags: real estate internet studies, Pew Institute, real estate marketing, home buyers
That sure doesn’t coincide with what I see in my practice.
I found it hard to believe myself. But I read the entire study (see link) and similar findings were found for cell phones and music.
http://www.pewinternet.org/pdfs/PIP_Consumer.Decisions.pdf
Phil
One must also consider that this may be good news for realtors– that whatever consumers read on the internet they may find what they learn from “people” (read agents) of greater impact.
What we need to keep in mind is that this is good news to the real estate industry! That means a majority of people still realize they need our guidance and expertise and aren’t buying property from pictures on their computer, like it’s some kind of video game. Our job now is to make sure they can find us when they’re prospecting to find the human touch they need to help them navigate the tricky waters of a real estate transaction. I’m heartened by these findings.
Joseph-
I think the greatest diservice that the net and the boom of prior years has done to agents is to forget to sell. Blog, get ranked top 5 for your big key phrase and wait.
The industry forgot that the license issued to them usually says salesmans license. So the blog, the website , the social media, the whatever needs to do something to slide that reader/prospect down the chute into a relationship. I think most think just writing a blog is the relationship. I don’t think it is even akin to asking them on a first date. At best it got you noticed.
I do not know how this notion of it being uncouth to “sell” and it sacriledge to speak of the visitor as a prospect or lead, and that somehow they will magically just plop onto the agents lap if we blog or create cool websites.
All I know is that if I didn’t have the guts to go up and talk to my gorgeously intimidating wife , and then ask her out we would not be married with kids today. If I did not ask for the sale on any of my clients I would not be in business today.
If the site does not capture the lead, the guy doing a low tech open house will.
Well said Tim. Getting people in the door (website, blog) does not equal a client.
I would say the Pew numbers are a little closer to reality than NAR’s IN MY MARKET.
When you spend as much time around the RE.NET as I do, it is hard not to get caught up in the fray over the way we should use technology in our business. At the end of the day, the Internet should be a tool in the toolbox of the overall marketing plan of a real estate professional.
Like Tim said, at some point you are going to have to ask for the business.
Here, here, Charles!
I guess the issue is what is a major impact?
I don’t think it is any big secret that you can’t really buy a house online. You have to SEE it in person to really understand the neighborhood, etc.
If I were a buyer making a purchase I would use the internet to help me screen homes, but I would not consider it an “impact” so I would be in the not at all category personally.
The internet is a tool to make things more efficient, but the purchase of a home is a personal one. The internet just can’t replace that experience of walking through homes and neighborhoods.
My experience is with Phil that I have yet to have a client that doesn’t look online at homes, but I am a high tech agent so I think that is just the kind of client I attract.
I agree with you Charles. 100%
The study shows, and few will dispute that the internet plays a significant role in “information gathering”— but so do other sources, including print and the agent. And what do consumers do when they have gathered enough information? My guess is they call a real estate agent, since, as Melina points out “you can’t really buy a home online” . How will you get the business when that call comes in?
The study also suggests that marketing should be not be limited to online. I would be curious to know the ROI of online marketing vs. traditional offline marketing (I have heard tell that a well scripted cold calling plan does, in fact, attract clients– and yes, I know it is not for everyone–some would rather sacrifice the business than cold call).
The issue at hand is how many visitors come thru a site a day? and How many raise their hand and say I am interested thru registration, email, or phone? Then what are you doing with those interested leads?
How many of those become deals?
If you know that you are on your way to being able to legitimately set a budget for your online marketing.
Because if you can put a value on each click, lets say it is one dollar. Then you would be willing to pay anything below a buck to get that click.
But…most cannot answer even the first question.
But again it comes down to capture. Are you going to ask the lady for a dance or are you sitting against the wall waiting for her to come to you?
For you technologists that have bought into the non sales mantra of the net…. Run the statistical probability on that one. I guess thats why there is a match.com, for those that still want to wait against the wall.
tim
you are absolutly correct. Learning to blog, figuring out how to “write for google” using twitter and face book are skills that have no bearing on whether you are a good realtor.
Too much emphasis has been on marketing and not on being a realtor.
So a “study” consisting of 314 telephone interviews (where, I wonder?) says only 11% of buyers utilized the internet, eh? I just came back from a study where I interviewed 600 people in San Angelo Texas who think Polygamy is valid and ordered by God!
The sample size is ludicrous, and so is the conclusion. NAR and CAR have it right: 84% of buyers use the internet, and 73% of them find their agent through a search engine. You are irresponsible to publish “stories” and “studies” that are so statistically hokum.