Growth of consumer expenditures and access to inexpensive capital

    fueled local marketing budgets in key categories
 ...
Transaction
                                                                    Peak     Today
                           ...
Approximately 3.6M                           Unique     % of

                                (in 000)       Visitors   T...
Reduced market                          Marketing spend

  activity diminished
  lead volume during                $10
  ...
Personal Income                 Hi Cost

                 Newspapers

                Radio
                        Specia...
Category         Activity
                                 Required   monthly
Avg. leads per
                            ...
Media                % Use
                              Spending distribution
Yard signs           98%
E-mail            ...
January    # of
 Agent               Platform
                                  Users    Agents
 requirements:        Fac...
Advertising spend will increasingly focus on

  differentiation
 Customer contact management will become a
  point of ex...
Leading local media              NCI Real Estate Brands

    provider serving the
                                     Th...
Kelsey Presentation
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Kelsey Presentation

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Presentation prepared for Kelsey's Interactive Local Markerplaces conference on March 16, 2009 in Los Angeles.

Published in: Business, Technology
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Kelsey Presentation

  1. 1. Growth of consumer expenditures and access to inexpensive capital  fueled local marketing budgets in key categories Auto  Real estate  Retail  Home products  Growth fueled expansion and innovation in local market media  Entrepreneurial growth  Venture-backed growth  Within climate of media expansion, distribution of consumer attention  has dispersed broadly Current economic contraction severely reducing local marketing spend  Local media competing on price and results during period of deteriorating  financial performance Social media expansion provides enticing low- to no-cost impact on lead  generation Current status: rapid re-engineering of business models and market-  facing tactics
  2. 2. Transaction Peak Today Value Home sales 7.1 M 4.5M Avg. Price $220K $175K Total Transaction 1.56T $822.5B Value Commission rate 5.75% 5.0% Commission value $89.5B $41.1B Bubble economics created 3 –  Transacting agents 600,000 500,000 5M additional transactions Avg./Agent $149.2K $82.3K during boom. Average price has declined 25%  from $229K to $170K. Incomes dramatically eroded Total price decline likely to level  by rapid decline in at 40% transactions and price.
  3. 3. Approximately 3.6M Unique % of  (in 000) Visitors Total homes for sale Networks 12,408 32.0%  All independent sites Move 7,425 19.2% have millions of Top brokers 4,862 12.6% duplicated listings. Top 5 12,108 31.3%  Brokers present broad independents view of market All others 1,915 4.9%  MLS distribution Total 38,718 100.0% expanding and becoming consumer facing. Independents include Trulia, Zillow, Homegain, RealtTrac, Homes.com, NCI Interactive Any house online at any time.
  4. 4. Reduced market Marketing spend  activity diminished lead volume during $10 leanest period $8  Top agents invest $6 approximately 8.5% of $4 commission revenue in marketing $2 60% of agents invest less  $0 than $3000/yr in Peak Today marketing Intermediary bears no inventory risk Average inventory: 9.6mos. in existing home sales
  5. 5. Personal Income Hi Cost Newspapers Radio Specialty magazines Internet Traditional New Listing MLS Media Media Services Direct E-mail mail Marketing Broker Web Site Blogs Yard Social Signs media Lo Cost
  6. 6. Category Activity  Required monthly Avg. leads per leads: 45 2 per month listing  Free sources # transactions 22 to earn $100K generate 20 – 25% Average time of total activity 180 days on market  Paid sources Total leads 550 required deliver leads at Annual approximately $20 marketing $7,920 investment per lead Marketing investment per $15 lead
  7. 7. Media % Use Spending distribution Yard signs 98% E-mail 91% Other media; 13% Broker web site 88% Spec. Newspapers, 16% mags.; Personal web site 86% 24% Specialty mags. 84% Internet listing 77% service Direct mail 76% Agent Newspapers 66% Internet web mktng; 24% site; SEM 61% 23% Social media/blogs 25% Cable TV 12% Source: Real Estate Agent Study Billboards 9% Conducted by OSR Group for NCI Radio 7%
  8. 8. January # of  Agent Platform Users Agents requirements: Facebook 57.2M 156,000 Content creation  MySpace 75.6M 80,360  Personality LinkedIn 7.7M ??? Twitter 2.6M ???  Authority Active  Relationship 930K 136,195 Rain  Outcome: Massive personal networks
  9. 9. Advertising spend will increasingly focus on  differentiation  Customer contact management will become a point of excellence  Social media applications will increase word of mouth leads by 10-15%  Listings enhancement will be supplanted by personal presence  Increasing proliferation of content generation/management tools Publish once to many  Original quality  Professionalism will require greater commitment  and expertise.
  10. 10. Leading local media NCI Real Estate Brands  provider serving the The Real Estate Book housing market TheRealEstateBook.com Rental markets: 48% of  revenue Unique Homes Resale markets: 35% of  New HomeFinder revenue Remodeling: 17% of revenue  Your Life By Design Integrated media platform  Your Home By Design Distribute 10M+  iConnect publications each month in 600 markets  2.1M unique users to multiple brand-specific web sites
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