'Big Changes Ahead'
April 17, 2002
Newspapers Face 'Triple Threat' As Realtors Shun Print Ads For Internet Listings
Inman News Features
One of the most stable classified advertising categories ? real estate ? has begun a subtle erosion due to the Internet and the shift threatens to disrupt the flow of $3.5 billion spent annually on newspaper listings and $3 billion spent on free-distribution rack publications, according to a study released by Borrell Associates Inc., a research company that studies the impact of digital media on local ad spending.
The 32-page report, "Big Changes Ahead for the Home Listings Business," says newspapers are facing a "triple threat" that includes shifting consumer home-seeking habits, a new Realtor policy, IDX or broker reciprocity, and anti-newspaper sentiment.
The Realtor broker reciprocity policy took effect Jan. 1 and is squarely positioning brokers as competitors with classified ad publishers, according to the report.
Some Realtors have already begun shifting their listings business from local print media to Internet applications, where they see more potential for lead generation. And, until last year, real estate listings revenue showed the weakest growth of the top three classified categories since 1996 despite four years of record home sales during that period, according to the report.
The report found that while some TV stations were taking advantage of the new Realtor policy and trying to tap into that $6.5 billion ad stream by providing local online e-publishing opportunities, newspapers were well-positioned to recapture any eroded dollars. Newspapers will still play a significant role in the real estate industry because of their investments in local Web operations and given newspapers? content, grasp of technology and reach into local audiences, they are strongly positioned over competitors to provide more dynamic, cross-media packages that give Realtors better lead generation and increased interactive functionality. But first, newspapers will need to recognize that the Internet has revolutionized the real estate market, according to the report.
"In the short term, newspapers may be whipsawed by the triple threat of changing home seeker habits, rising Realtor sentiment against print classifieds and the increased ability of Realtors to post their own listings," said Gordon Borrell, president and CEO of Borrell Associates. "In the long term, we think there?s a strong potential of a win-win for both industries, as well as for consumers," as newspapers learn to reposition their offering to better provide Realtors with the tools they need to be successful in the local market.
"Over time, the smarter, Internet-savvy newspapers will be viewed as a tool for lead generation and Web site development, rather than as simple providers of ads in the back of a real estate section," Borrell says.
The study was based on interviews with agents, brokers and multiple listing service executives across the United States. A second part of the study, to be released in May, surveys the online habits of thousands of home-shopping consumers.
The survey was sponsored in part by InsightExpress LLC, a provider of online research tools, and by CityXpress Corp., which offers online real estate content.
Copyright: Inman News Service
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