Part 1: The Rise of the Real Estate Industry
Part 2: The Birth of Agent Advertising
Part 3: The Dawn of the Internet Age
Part 4: The Invention of the Inbound Approach
Part 5: The Reshaping of Real Estate Marketing
As you might suspect, agents didn’t have a lot of marketing resources available to them to promote their companies and market their clients’ listings. Word-of-mouth was an agent’s best opportunity to gain attention and build a strong business reputation.
Fast forward a century-plus, and the sheer number of real estate marketing resources at the disposal of agents, brokers, and their respective teams is overwhelming.
Comparative market analysis software, digital listing presentation templates, lead management solutions, and responsive MLS-integrated websites account for just a tiny portion of the tools, apps, and platforms real estate professionals use today. Each of these modern marketing resources help agents gain brand awareness and spread word of mouth to the world of internet search.
Without the evolution of technology that has occurred over the past couple of decades, real estate marketing would not be nearly as effective for agents and brokers today.
How has real estate marketing evolved for agents over the years? How have top producers adapted to these changes? To learn what you can do to ensure your real estate marketing strategy saves you more time, earns you more money, and helps you scale your agency so you can compete in (and dominate) your market for years to come — read on.
The Association of Real Estate License Law Officials (ARELLO) reports there are approximately 2 million real estate agents with active licenses operating in the United States. That may seem like a crazy number. Think about how many local markets exist nationwide, however, and that figure starts to make more sense:
40: The number of U.S. cities with populations of 400,000+ residents.
3,142: The total number of counties that exist across the U.S.
326,000,000: The total population of the U.S. as of October 2017.
In short, there’s about one active real estate pro for every 163 people.
The National Association of REALTORS was founded in 1908 under the name National Association of Real Estate Exchanges (NAREE) with 120 founding members — a far cry from today’s totals.
These members lived in just a third of all states, meaning it took a fair amount of time for REALTORS to make their way to other areas of the country to aid home buyers and sellers.
It took a little while for regulations or laws to build up around this new profession, but in 1913 “The Ethics of the Real Estate Profession” was written to ensure agents played by the rules.
Despite this initial guiding document, real estate professionals who worked under NAREE were basically free to market their listings and brands as they saw fit.
These pioneering agents didn’t really have much to help them promote their services, save for word-of-mouth among their social circles and spheres.
However, early signs of modern marketing practices began appearing as the first-ever open house took place sometime during the 1910s, and yard signs became a popular fad among REALTORS nationwide.
During the first half of the 20th century, agents began perfecting their real estate marketing plans and approaches — just in time for a huge buying spike. The 1940s arrived, and seemingly every U.S. resident wanted to buy a new home.
Per data from the Census Bureau, the homeownership rate jumped from 46% in 1940 to around 66% by 2000; a substantial rise in buying that led to a substantial rise in the number of agents joining the real estate industry.
As competition for home buyers and sellers heated up, new real estate marketing tactics — including advertising — became a necessity.
Further Reading on the Real Estate Industry’s Evolution:
According to Ad Age, the first-ever print real estate advertisement ran in 1704. A brief announcement in the Boston News-Letter let readers know that the ad-taker was looking for someone to buy their property in Oyster Bay, Long Island, New York.
During the second half of the 20th century, real estate agents made considerable use of newspapers and magazines to promote their listings and businesses. Print publications were the best way to get in front of the masses, given that everyone subscribed to at least one, if not a few…
… Until radio and TV stations made their way into the mainstream and onto the stereos and screens of practically every American. Per NPR, the first real estate radio ad ran in 1922 to promote an apartment building in Queens, New York:
“[The WEAF] studio was essentially a phone booth to the airwaves. Anyone who wanted to buy access had to bring his own message and pay the toll. The station’s first customer was the Hawthorne Court Apartments in Jackson Heights, New York. The company bought 10 minutes for $50.”
Once real estate pros mastered radio ads, they slowly but surely transitioned to TV.
Real estate franchises like Century 21 and RE/MAX were the first to get national airtime for their businesses and promote their agents across the country. Eventually, nationwide campaigns led to more locally focused TV ads for industry pros in regional markets.
With TV advertisements, the problem was ensuring that ad dollars went to the right people at the right time: Were leads and clients really watching or listening to these ads?
Tracking the success of outbound marketing tactics was sketchy, to say the least.
To put their marketing eggs in another basket, real estate agents turned to yet another medium in the 1970s, 80s, and 90s: direct mail. From simple postcards to in-depth brochures, industry pros went to great lengths to create eye-popping real estate marketing flyers and pamphlets.
Statistics from the Data & Marketing Association show the volume of direct mailers is dwindling today. And yet, brands spent nearly $9 billion on direct mail in 2016. Why? In short, because some industries— including real estate — still see at least some value in this old-school marketing method.
Combined together, radio, TV, and direct mail ads made up practically all of the promotion for agents and brokers during the 20th century. But that all changed in the 1990s, when something called “the internet” changed the way we consume information, connect with one another — and buy and sell real estate.
Further Reading on the State of Online Advertising
Known for his keen perspective on the intersection of real estate and technology, industry influencer Stefan Swanepoel was ahead of the curve when it came to forecasting the role the internet would play in agents’ and brokers’ businesses a decade ago:
“Competition in the world of technology doesn’t stand still for even a moment; it is constantly moving ahead to the next big thing. Therefore, real estate professionals who are still 1.0 are ‘so yesterday.’ They need to seriously upgrade their mindset to 2.0.”
Many changes in the Internet Age have come and gone since Swanepoel shared this with RISmedia in 2007.
The web has evolved to the point where many real estate pros who fail to keep up with the latest trends are often left in the digital dust and forced to play catch-up.
As the Internet became mainstream, the first question most real estate professionals asked themselves was an obvious one: “How can I use this to achieve my business goals?”
As e-commerce companies and brands found a way to sell their products and services digitally to consumers during the startup boom, agents and brokers were able to take notes.
Though many startups flamed out in the late 1990s and early 2000s during the “dot-com bubble,” real estate pros were also able to learn lessons from those failed ventures.
Specifically, agents realized they could advertise themselves with specialty real estate marketing tactics to connect with their niche home buyer and seller audiences and promote their listings via branded websites.
These real estate websites were pretty plain to start, but over time, Multiple Listing Services (MLS) allowed industry professionals to aggregate local listings via the Internet Data Exchange (IDX) and in turn get more online traffic.
It was this seemingly minor move that paved the way for agents and brokers throughout the U.S. to start featuring their own listings and attracting their core demographics.
As they began featuring anything from a handful of homes for sale to a hundred, real estate pros discovered they no longer had to rely on offline marketing methods. Instead, they could spend their promotional energy (and money) online.
While excitement grew among the real estate community during the early 2000s, an unforeseen problem emerged in the form of search engine optimization (SEO). Agents were used to simply throwing money at marketing problems to solve them. Now, they needed an updated vocabulary and skill set to thrive in the new digital world.
Used to cold calls, print ads, and direct mailers, agents had to master inbound marketing to earn business in the online era.
Further Reading on the Internet’s Impact on Agents
Let’s roll back the clocks to the early 2000s. Real estate agents were just getting used to sharing information about their businesses and trying to appeal to their primary buyer or seller audience online.
They knew that a real estate website would help with their branding, but many weren’t patient enough to develop long-term real estate lead generation strategies that slowly but steadily improved their site traffic and nurtured potential prospects through their sales cycles.
Because of this impatience, they continued with their old-school, outbound real estate marketing tactics: cold calling locals, reaching out to any connection for referrals, and sending mailers to everyone in a 10-mile radius.
Meanwhile, they discovered other agents were investing time behind their computers instead of out and about or on the phones. What were these agents doing, exactly? In a nutshell: Developing and mastering their inbound marketing skills (while also eliminating their outbound mentalities).
The inbound marketing concept is fairly simple: Instead of being the one to chase after every possible buyer or seller client and promote yourself like crazy, the way you would with TV and radio ads — you build an appealing, informative, and SEO-friendly web presence to get leads and customers to come to you.
Since most modern agents now spend a good amount of time researching keywords for their websites, brainstorming blog post ideas to write, producing compelling graphics and videos, and planning promotion of all of those assets, they’re able to reduce marketing costs and boost return on investment (ROI).
According to data from marketing software firm HubSpot, the inbound method costs 61% less than the outbound approach. In other words, the cost of lead acquisition is far less than outbound techniques, meaning you can save money and generate more income by getting higher quality leads in the door regularly.
While inbound marketing is becoming the norm, that doesn’t mean you have to completely ditch older tactics. For instance, it can still be effective to send direct mailers to prospects that you think may have the potential to become clients.
The rules of the game have changed — and continue to change. That may seem scary, but as long as you learn the basics of inbound marketing, read up on best practices, and update your marketing plan accordingly, you can build lead generation and nurturing machines that will work wonders for your agency.
Further Reading on the Popularity of Inbound Marketing