Positioning for the Coming Real Estate Boom
March 29, 2012 Leave a comment
Long Extended Cycle Means Real Estate Sales Demand will Return Like a Tsunami
A number of real estate marketing service companies are preparing for the return of the real estate market. And let’s face it, if they begin preparation now, they will be well positioned to take the market when it returns. Zillow, Realestatewebmasters, and Market Leader are 3 companies to look at as the battle of this market shapes up. And there are many smaller hosting and marketing companies looking to carve out a niche.
Real Estate Services is one market sector worth a look if you’re an investor looking for the next breakout opportunity. There are millions of real estate agents in North America, Caribbean, and the UK and their sector is very competitive, yet most agents don’t have the skill or time to do marketing well. Those agents/brokers do their online marketing well stand to dominate their local markets.
Rising Stars in Realtor Marketing Services Online
3 high profile companies stand out as the lead horses in the race to dominate the real estate marketing service category. This category is about helping real estate companies gain visibility online, manage contacts, optimize email and ad campaigns, create leads, and build client loyalty. Given that all agents are turning to the web to generate sales leads, those companies that can provide these services are going to be highly valuated in the years ahead.
Zillow, Real Estate Webmasters, and Market Leader are the 3 top contenders to take the realtor service industry. Zillow had its high profile IPO launch last year and is now valuated at a billion dollars. It shows how a good idea (groupon, linkedin) can take off these days and make investors incredibly rich. Real estate webmasters is another successful company that might make such a move soon too. Market Leader ® recently purchased realestate.com and is purported to now be worth $84 Million. One interview with the company’s exec stated the company is losing money yet is still worth 100 to 200 million potentially. Realestate.com is a great property however they’ll need more to compete at the top level.
Zillow, (partnered with Yahoo), recently bought Diverse solutions (powerful idx solutions) to bolster its ability to create leads. The IPO will give Zillow the funds it needs to be a real estate marketing leader. First to market really, since not many companies have established themselves as a leader in real estate marketing services. Most are positioned as real estate agent web hosting companies. The market is fragmented due to the fact that mls associations are themselves fragmented. Zillow, and Yahoo’s Trulia are after the national market in the US, and they’re offering real estate agent advertising services.
Realestatewebmasters is perhaps the largest real estate web hosting company providing a complete content and client contact management system. Each customer is responsible for their own content development and marketing. Realestatewebmasters has some great website solutions (some customers might pay up to $30k setting up their custom site in the first year) however, because it is a system, it presents some limitations for lead conversion (standard programming). Realestatewebmasters doesn’t have agreements with all mls associations across North America.
What Zillow, Market Leader ®, Trulia, Realtor.ca, Realtor.com and other big players in this sector don’t offer to agents, is strategic, original content and dedicated marketing services. Their customers are basically provided with a generic hosting and visibility service. Agents are so desperate for leads however, that they are signing up. An advanced type of service that helps individual agents with content development services and top level SEO and Social Media strategies, will be more attractive. If an agent doesn’t get the leads and sales they need, they are quick to move onto another hosting provider. There’s lots of churn in the real estate hosting business.
Given that the large services can’t deliver the dedicated service and original content targeted for local city markets, there is a niche that can be exploited by dedicated content developers. Right now, IDX solutions are all the rage, but with the changes in Google’s search engine algorithm, new, original, engaging and sales converting content will be what everyone is after. The big companies won’t be creating that strategic content for agents.