I visited the National Association of Realtors convention in San Diego last week.
The show was markedly different than the year before. The footprint was smaller, but the energy was higher. Fewer vendors were serving the market, but the vendors that were present focused on very specific utility that would produce benefits for brokers and agents.
Talk with agents and you heard a firmness in their tone and a positiveness in their approach that was absent the year before.
The market isn’t bouncing back anytime soon, they said, but there was consistent activity and the opportunity to make money.
My colleague Todd Dubner had many of the same impressions, which he shares on his blog Being Present.
Todd was particularly struck by the approach of the entrepreneurs he met during the show:
Creative vendors are getting their mental juices going. At NCI, we believe in the intelligence of the entrepreneur. We pay attention to what innovative thinkers are chasing and try to find where people are showing signs of profit. There was just more of that at the show this year than last. The ideas that were being shopped felt more concrete and actionable with a clearer value proposition than those in the past. No one was doing the, “if I could get 80% of agents to give me a dollar” math that never works out.
We’re hearing more positive reports from the field across our company as well. More is a relative term: for the past 18 months, positive reports have been few and far between in our real estate media business. I sat down with one of our business partners in the northeast over the weekend. He’s been with our company for more than 15 years, and the anxiety that he had expressed a year ago had been replaced by a confidence that the market was recovering, slowly and fitfully, but consistently.
These are anecdotal and ground-level reads. As such, one should be cautious to not get swayed by isolated instances of positive emotion. But, the repetition of these instances, in the face of continuing negative macro conditions, suggests that the pace of business activity is picking up in such a way that people who make their living from it are feeling like they are going to be able to make their living better.
The FineOnMedia blog yesterday had a short interview with the new editor of BusinessWeek, who talked a little about his approach to his new position.
Today, Jon Fine tweeted that he was leaving BusinessWeek.
Of course, Jon hasn’t been writing the FineonMedia blog for the past several months, as he’s been off on a sabbatical, traveling around the world with his wife Laurel Touby. And, the blog isn’t FineonMedia any longer.
I’ve been fortunate over the years to have a fairly constant dialogue with Jon about media, politics, the overwhelming randomness of fortune, the future of content and stuff like that. Over the past 18 months or so, he’s written some of the more interesting perspectives about the rapid shifts the media industry has undergone.
Here’s one of his more interesting takes on the future of content conundrum.
You can always follow Jon on Twitter at @jonfine.
What’s the value of celebrity endorsements?
According to the findings of a new Adweek Media/ Harris Poll, looking at celebrities and their persuasiveness, 21% of Americans say they find athletes to be most persuasive when they endorse a product, followed by 18% who say television or movie stars are most persuasive, 14% who say singers or musicians and 10% who say former political figures are most persuasive. On the other hand, speaking of celebrities ranking in the category of least persuasive, 23% of the survey respondents say television or movie stars are least persuasive, while 14% say business leaders are least persuasive. 13% of Americans say when athletes endorse a product they find them least persuasive and 11% say singers or musicians are least persuasive.
The research speaks to the persuasive value of people who are really good at something that looks hard to do: build a product, run a business or be a sports star. Good looks and a nice disposition — some of the requirements of being a movie star — have diminishing value the older we get.
You can see the MediaPost report here.
John Mauldin’s letter this week was detail, thought-provoking and important for anyone who is planning their business strategy for the next several years.
Maudlin built on an argument that he introduced a couple of months ago. Drawing on the work of several colleagues, Maudlin empirically demonstrated that the economy was unlikely to replace the volume of lost jobs created by this economic disruption for many years.
In this weeks letter he probes this argument more deeply, leveraging the work of Mike Shedlock to play out the impact of three different economic recovery scenarios on employment. The charts to the right show the outcomes of Scenario 1, which assumes that this recovery generates jobs at roughly the rate of past recoveries, and Scenario 3, which assumes that we have a double-dip recession and generate new jobs more slowly than in past recoveries.
Maudlin concludes with this summary:
We are at 10.2% unemployment today. The economy lost jobs for 21 months after the end of the last recession. That would easily take us into 2011. Another million lost jobs will take us well over 11% and close to 12% (remember, you have to add in the increasing population), even without my double-dip scenario.
The letter is getting long and it’s getting late, so let me close with a few thoughts.
First, 12% unemployment is horrendous by American standards. But Spain is now at 20%, and much of Europe has been in the 10% range for years.
Second, Americans are not used to the concept of 12% unemployment or 10% rates for extended periods. That is going to cause a serious backlash across the political spectrum. Couple that with the discomfort over $1.5-trillion deficits and there could be some serious political changes in the coming years. I think the message will be more anti-incumbent than one party or the other.
Third, the only way out of this morass is to create an environment where small business can thrive. As I’ve noted for the last several weeks in this letter, government spending does not increase GDP over time. It is a temporary nonproductive stimulus. It takes private investment to create jobs and increase productivity.
Why share this perspective? Because I think that it is critically important and very easy to lose sight of. We are entering into a period of relief because a bottom of sorts has been reached. Energy and optimism are shifting at the local level. But these emotions are just by-products of short-term change. Longer term, we will be managing our businesses in a climate unlike any other we’ve experienced in the last 25 years.
The by-product of sustained high unemployment is to increase the burden on public services, reduce consumer demand, shift long-term trends in production and create intense pressure on the monetary system and, as a result, tax receipts.
As Maudlin points out, this tax policy generally punishes small business. Successful small businesses generally are significant cash generators — entrepreneurs figure out how to build products and services that require minimal capital investment, and as a result, when their business is successful, they generate significant amounts of cash.
Simple tax policy says to take a larger portion of that cash to fund the public burden. The simple counter is that if the entrepreneur is allowed to retain their cash, they will create more jobs.
It’s not as simple as that: many small businesses are built with the goal of supporting a lifestyle, and once a certain level of earnings is reached, the energy to build the business subsides.
Tax policies that create incentives for job growth, that give a small business a direct financial incentive to look for growth and to hire more people, are the kind of policies that would most directly benefit the economy today.
I’m looking forward to Maudlin’s thoughts on how to achieve these outcomes, and what the risks are if we don’t.
To see Shedlock’s detailed analysis of the composition of the emerging employment market, click here.
I’ve been intrigued by the dynamics of the online audiences in the primary markets that we serve at NCI. In the past, I’ve written about the surprisingly low overlap among the visitors to the leading online apartment aggregators (termed ILS’s in the multi-family industry.)
We’re finishing up some interesting research on the different ways that consumers use media across multiple channels when they are shopping for a home or apartment. Not surprisingly, people will consumer information wherever they can get it, in print or online. The key driver of usage is availability: Can the consumer easily find it and use it?
Some of the research results got me wondering again about the attributes of the online audience. I went back to Comscore/Media Metrix and did an analysis of the cross visits among four of the leading rental sites. The performance of the three integrated media players was of particular interest, since we all have substantial advantages in terms of promoting our internet brands in our print publications. Apartments.com is a joint venture of a consortium of newspaper companies and also enjoys some of this advantage.
The results for September were interesting. First, and in a pleasant surprise, ApartmentFinder.com had the lowest instance of cross visits among the group of four, despite being at the bottom in terms of overall traffic. What does that mean? First, we have to acknowledge some margin of error, given the sample size within Media Metrix’ panel. But, the results suggest that ApartmentFinder.com has the same size unique audience as its three peers.
Why do we have a lower instance of overlap? Our theory is that our strategy of focusing on longer search terms helps to drive a different type of apartment shopper. If you search the key shopping terms, like “Apartments for Rent,” our competitors have a larger share of voice than we do. (They also spend substantially more on search marketing dollars than we do.) Search longer terms, like “garden apartment for rent someplace specific in a specific state” and ApartmentFinder.com is more likely to come up as one of the first options in organic search.
Some more research showed me that while this conclusion was generally true, our traffic has also been driven by our social media marketing strategy. Compete! shows that Facebook was the largest referrer of ApartmentFinder.com traffic in September by a factor of 2 over Google.
I suspect that helps to create a unique audience in the apartment space. As my colleague Todd Dubner has pointed out, the relatively low audience overlap among the leading internet service providers in the apartment space argues for broad distribution by apartment communities of their basic listings, in order to create the largest digital footprint to draw prospects from.
The devastation in the real estate industry over the past three years has had a huge personal toll on the tens of thousands of people who had built businesses, and personal wealth, during the real estate boom. Real estate agents, brokers, mortgage professionals, appraisers, builders…all have seen their income plummet along with home prices and the pace of transactions in the market.
At NCI, our fortunes are closely tied with professionals in the housing market. One of our largest brands, The Real Estate Book, is a premium marketing outlet for real estate agents, builders and mortgage professionals. By Design is a leader in the market for personal branding solutions. Unique Homes is a foundation brand in the luxury real estate space.
Over the past year, we’ve done a lot of work to be certain that we understand EXACTLY what value we offer our customers and how they can best use our products and services to be more successful. We’ve conducted controlled tests to determine how many leads — property-specific phone calls, e-mails and web visits — we drive for our advertisers. We’ve done research of past and current customers to understand what is working and what isn’t. We’ve done research of home buyers and home sellers in order to understand how they acquire information during the home purchase process, and why they pick one realtor over another.
During this process, we began to realize that there was a fundamental challenge every realtor was facing. There is no shortage of ways to market your listings and your personal brand. Some are free, some just require an investment of time and some require you to part with your hard-earned money. The problem is, Where do you start? What should you do? And who should you listen to in the cacophony of experts — some true and some self-appointed — who claim one tactic works and another doesn’t?
A light bulb went off: A real estate agent should start by stating how much money they want to make, calculate how many homes they need to sell to make that amount and then decide how many buyer and seller leads they need to sell that many homes. THEN they should make decisions about how to market.
We term this An Income-Based Approach to Real Estate Marketing. And we decided we could do a service to all of our partners by fleshing out the approach and making it easy to implement.
For the past three months, Scott Dixon and Todd Walker, the leaders of The Real Estate Book brand, have been interviewing dozens of leading real estate agents about the underlying metrics of their practice: How many homes do you sell, how many leads do you get, how do you process them and what sources do you use to generate them? Scott and Todd have a natural advantage in this conversation: they have been intimately involved in the real estate industry, working with agents to help them build their business, for more than 20 years.
This week at the National Association of Realtors convention in San Diego, Scott and Todd are rolling out the work of their efforts.They ‘ve created a workbook with worksheets real estate agents can fill out in order to build a concrete and fact-based marketing plan.
They’ve worked hard to create something that will be of value to real estate agents. They’ve worked very hard to create something that is intellectually honest and fact-based. For instance, their research has shown us that advertising in The Real Estate Book is a good way to drive a high volume of leads and to stay very visible to your sellers and to the market. But, it is more costly than many other marketing programs, and is an investment that should be made by an agent who is looking to sustain or build a high level of activity and income. Scott and Todd try to make that clear in the book: your approach to marketing should be different if you want to make $50,000 in a year than if you want to make $150,000.
To get your own copy of the workbook, visit this link. We’d love to hear your feedback. You can share your thoughts and experiences at The Real Estate Book blog or join the conversation on our Facebook fan page.
Above all, use the book. It will help you set a concrete goal for your income in the year ahead and it will break down into discrete steps what you need to do to make that goal. 2010 is your year for growth! And it’s about time.
TMG Brand Communications, the NY-based marketing and communications agency of record for NCI, was awarded eight Communicator Awards from the International Academy of Visual Arts for work it did for its clients last year. The statues just arrived in the mail and Tami, the CEO, wanted to share the moment. It’s a cute video. Among the award-winning work were projects for The Real Estate Book, Apartment Finder and Unique Homes. You can learn more about TMG at their web site. [Full disclosure: I'm privileged to be married to the Founder & CEO of TMG, Tami McCarthy]
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