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

2. 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

3. 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.

4. 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.

5. 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

6. 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

7. 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

8. 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%

9. 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

10. 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.

11. 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