Homestore, Homes.com, and other national Internet advertising firms are counting on a major shift in perception among average Realtors. They already have the top adopters of their services. Now, in order to grow sales, they need the average broker and agent to believe evidence of the superiority of Internet advertising over tried and true media such as newspapers.

Late adopters are a much tougher sale because competition is stiffer, but once they come on board, they do so in much bigger numbers. It's a lot easier to sell a Web site or e-newsletter to someone who knows s/he needs one, than to someone who has to be sold on why s/he needs one. But that is the attitude of the average Realtor who has been holding out for stronger evidence that the Internet is as good a place or better to spend advertising and personal marketing dollars.

That's why they aren't early adopters.

The challenge for Internet media will be getting the why-you-need-my-product information to these average Realtors in enough waves that they will be drenched with readiness to buy based on products' merits.

Unfortunately, Internet media is still mired in trying to prove the merits of the Internet before individual companies can sell their own products. In short, Realtors aren't ready to give up their classified ads just yet, so they have a decision to make. How little can I spend to get on the Internet, to say I'm there, and still make no change in my advertising budget with the local paper?

Homestore, et al, has enough statistical ammunition to tip the scale, but are Realtors paying attention? Here's one statistic that every Realtor who writes a check to advertisers should know by heart: for the first time this year, the Internet ran neck and neck with newspapers as the number one source for homebuyers seeking information. Forty-one percent of homebuyers used the Internet and 41 percent used the local newspaper. Wow! That is huge, especially when put in context of growth. Only two percent of homebuyers used the Internet in 1996, according to the National Association of Realtors. In less than five years, the Internet has caught up with newspapers as the most important media source for buyers.

It is too much of a stretch to assume that shortly the Internet will surpass newspapers in attracting buyers?

There's plenty of reason to believe this could happen. Homestore, Homes.com and others already have relationships in place with MLSs to display listings for free. These listings are enhanced with irresistible eye candy - neighborhood information, virtual tours, school and crime data, and more - including Web sites that showcase the listing agent, in most cases. These listings are exposed for free, and these sites don't allow FSBO listings a foot in the door. Where the expense for Realtors comes in are in Web site lead generation packages - personal marketing exposure. Newspapers, on the other hand, don't have a business model based on displaying free listings. You want to advertise a listing? Pay up front. And forget showing off your credentials alongside your listing. That's extra.

The Internet listings model is as complete a departure from the classified ad business model as you can get. Yet, the Internet and newspapers are more alike than they are different. At their core, they are both about exposure. Homestore, Homes.com and others are media, like television, newspapers or magazines. The only difference is that Homestore, et al, operates on the Internet. That can be intimidating to the advertising-burdened Realtor who is still very loyal to the local newspaper. Never mind that the medium in most cities is incapable of exposing more than a one-dimensional photo and word-stingy data. (Apologies to Internet-forward newspapers.)

Homestore and other media want to be paid for exposing Realtors. The listings are a means to an end. Even so, they are late to the party. Many Realtors are already strapped.

The Internet represents a fairly new medium for advertising listings and for personal marketing. The conundrum is that the average Realtor's revenues may not have grown to accommodate new marketing programs without giving up other mediums for getting business. Average Realtors don't want to go through the learning curve of e-mail and its etiquette, or digital camera technologies. They are too busy trying to keep their heads above water which would indicate that the advertising they are already doing isn't that productive.

Adding to the burden, brokers have already off-loaded most of their advertising costs onto their agents. Agents buy their own classified ads for listings as well as the company-branded signs that go in the yard. Add to that the challenge that agents must not only compete with each other in the same firm, they have to compete against other agents in other firms, as well as the brands of those firms, and the national brands on top of that. That creates a whole other category of expense - personal marketing.

Some brokers may advertise homes in large half and one-page spreads in the Sunday sections of the newspaper, but these ads are as much for recruiting and market-share posturing as advertising listings. Only key listings or favored agents listings make it to the press. Ads are pricey enough that many brokers feel they have done their part. Other brokers who see the potential of the Internet have thought of new ways to make the agent pay for advertising. They adopt IDX or VOW solutions where they can capture Internet leads through the brokerage, and then charge their agents referral fees for business that comes in through the Internet.

So, overcommitted and undercapitalized, the average Realtor would seem to make a poor target for Internet media, but that is where the Internet media needs to camp to grow revenues. The average Realtor, in order to adopt Internet products, has the least amount of money to spend, but the highest motivation to shop wisely.

In order to grow, Internet media must demonstrate its cost-effectiveness for the Realtor to make that leap of faith. The Realtor must believe that saving money is as good as earning more money, and that by saving money with the Internet, they will be better exposed and be able to earn more money.

If a Realtor can cut costs while generating the same or more business, then that is a very profitable day.

Published: October 23, 2002

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Blanche is a renowned author of five real estate books. Her newest, Bubbles, Booms and Busts: Make Money In Any Real Estate Market, McGraw-Hill, was rave-reviewed by The New York Times. She was also selected from hundreds of real estate experts to contribute to Donald Trump's book, Trump: The Best Real Estate Advice I Ever Received: 100 Top Experts Share Their Strategies, Rutledge Hill Press, and is featured on page 68. Order Now Review - Honors In 2006, Blanche was selected among scores of candidates to author two consumer real estate guidebooks for the National Association of Realtors: The NAR Guide to Home Buying, and The NAR Guide to Home Selling, Wiley & Sons. She is currently planning two new books for the NAR and its members.       Known for her keen insight into real estate industry issues and for her ability to make complex subjects easy to understand, Blanche is a sought-after keynote and continuing education speaker. Real estate organizations from MLSs, to brokerages, to franchisors, to associations hire her to provide up-to-the-minute analysis of real estate industry news and advice on how to improve revenues. Her passionate delivery, peppered with stinging wit, is a huge hit with audiences and fans. Don Klein, CEO Greater Nashville Association of Realtors, Blanche Evans, Richard Courtney, president 2007, GRAR "The GNAR membership meeting last week featured Blanche Evans as the keynote speaker. Her comments and insights resonated extremely well with those in attendance and we have had many requests for copies of her PowerPoint Presentation. She was a terrific part of the membership meeting and convention program!" - Don Klein, CEO Greater Nashville Association of Realtors Coverage from WSMV, Nashville - 8-14-2007 That Interview Guy - Get Inside The Head Of Today's Generation 2007 AE Institute Session - To purchase 2006 AE Institute Session - Parts 1 2 3 4 5 6 7 8 9 HouseValues Mastermind call - Parts 1 2 Blanche's fireside chat with Jeremy Conaway, HAR - Click here. For more articles by Blanche, click here.