Is your business still paddling in its comfort zone or have you taken the plunge and adopted new technology and new approaches? If you want to ride the wave of success you might need to let go of your old ways. Story by Kevin Johnson-Bade.
Businesses deal with change in quite different ways, as do the personalities that manage them. For some, change represents an unwanted and unnecessary burden; a distraction from the all important process of running the business. When the change involves the adoption of new technologies, many businesses will avoid change as long as possible by focusing on their own proven and understood methods. This reaction is understandable when the business may lack sufficient internal knowledge of the matter to fully understand the implications and/or know how best to change their direction.
The impact of the WWW on the process of buying properties and booking holidays has been profound and continues to evolve. From the outset in the early to mid nineties when we developed the first real estate and accommodation sites, the Internet offered clear benefits for potential travelers and home buyers. Mosaic, the early WWW browser was simple in comparison to the modern browser, but it did allow the consumer to view and explore holiday destinations and properties for sale without leaving their home or the office.
The obvious benefits to the consumer influenced their rapid take-up, resulting in travel and real estate being amongst the most highly evolved business sectors with regards to the Internet utilisation. None of this would have been possible if it weren’t for the businesses that in the early to mid 1990s shared our vision of what could be achieved with these new technologies. These astute and courageous businesses are essential for technology developers to bring the dreams of innovation to reality. In technology adoption terms they are the innovators.
“The paths taken by the consumer to reach what you are selling continue to change. Thus new opportunities continually arise for the astute early adopter real estate agent.”
Everett Roger’s Technology Adoption Lifecycle describes how new ideas and technologies spread in different cultures. He divides the adoption in to phases: Innovators; Early Adopters; Early Majority; Late Majority; followed by the Laggards.
As technology developers we refer to this and the curve modified by Geoffrey A Moore in Crossing the Chasm to help us understand the character of innovative technology diffusion within a target market. But what does this all mean to a real estate business? If we ignore the weird and rare innovators who have a strange love of technology, and combine the early and late majority, we are left with three groups: Early Adopters; Majority; and Laggards.
The Internet offered the consumer more than just a convenient way to plan a holiday or research a property to purchase. So to a large extent the readiness of the consumer to embrace this new technology outstripped the readiness of the real estate agent to deliver in that context. These changes don’t really affect the market size, but they do affect how it is distributed. In the early stages business very definitely shifts from the majority and laggards, to the early adopters. The laggards will experience a gradual decline in business without really knowing why, and maybe incorrectly attribute it to other factors.
With the evolution of the WWW many early adopters recognised the opportunity and were able to grow their businesses based on the change. Change fosters opportunity. But what opportunity is there for the astute businesses now we are fifteen years down the WWW highway? Aren’t even the slowest of real estate industry laggards onboard by now? Well yes, but possibly not in the best way, and whether we like it or not the technology keeps evolving, and so the paths taken by the consumer to reach what you are selling continue to change. Thus new opportunities continually arise for the astute early adopter real estate agent.
“Our experience is that early adopter holiday letting agents have been more able to cope with the downturn in real estate sales because of their growth in booking sales.”
In the past many agents haven’t really taken holiday letting that seriously as a money making concern. An appropriate eMarketing strategy will increase sales whilst good systems will improve efficiencies and reduce running costs.
Good systems include thorough and efficient internal procedures utilising advanced tools and software for property/trust management and booking management. Online functionality should be used for more than just advertising. Online bidding, sales and monetary transactions are becoming more common, and purchasing accommodation online is expected by consumers today.
As a modern real estate business you must develop an eMarketing strategy that accommodates the many new ways that customers have to find and select your product.
Firstly, treat your own web site as a significant business asset, and an integral member of the team, rather than just an advertisement. Your site is no more a ‘source of business’ than the person answering the office phone. Your web site should simply and efficiently work to convert inquiries into sales, or convert traffic into sales.
A site’s ability to convert traffic into sales depends on the relevance and quality of its content, along with accessibility and clearly defined and easy calls to action. It is paramount that the site converts traffic to sales in the most efficient way, by minimising the load on your human staff. You want your staff to be dealing more with high quality enquiries. Also, encourage your staff to communicate with site visitors as if they were in your office. The front page and news should be updated weekly.
But all that depends on getting traffic to your site. The paths taken by the consumer to reach your site are always evolving and Google’s influence and significance (still!) continues to grow.
To generalise, traffic to a real estate site includes: referred by the agent, including returns (good will) and cross media adverting; Google, including searches, Adwords (PPC), Maps/Local Business and Google Base; Other Links, including other search engines and sites.
Looking at actual source of business data from January 2009, for a holiday letting agent with 150 properties and a good eMarketing strategy, we see the following: returns comprise over 60% indicating a high satisfaction in the service. The next highest source is Google at 21%. With this agent the Google component may vary between 20% and 35% whilst with other agents it may be as high as 45%.
Alternatively, a site that cannot be found will have far less traffic and contribute little to sales. The Google document Search Engine Optimisation Starter Guide is a good introduction to the subject of search engine optimisation of SEO.
Apart from Google the social networking sites like Facebook and Youtube are becoming more important. These are places where potential customers spend their time and communicate to others about the house they are buying or the holiday they have been on. This will lead to referrals so your presence will be beneficial.
Twitter is even worth considering for a holiday letting business where last minute specials could be fed automatically. Note that Fairfax are testing the waters at https://twitter.com/stayz
A well designed real estate agent’s eMarketing strategy will work creatively to pull business in from a wide range of sources including Google searches, Adwords, Facebook, Youtube and perhaps even Twitter, and then use traffic analysis tools like Analytics to accurately monitor and tune its effectiveness.
Collaborative portal sites are worth using, particularly those that provide high quality leads that feed directly into your systems, thus reducing processing time. A high volume of low quality leads that consume a lot of time with poor conversion rates are really of little value.
To future-proof your business in the current economic climate you must resource personnel to develop your own strategy and foster positive change within your business. There is just so much opportunity.