It wasn’t that long ago that Facebook began to suck all the air out of the digital marketing room and leave those offering more traditional marketing options reeling. Headlines boldly predicted the end of print, the demise of television, and the futility of radio advertising proliferated our industry magazines, blogs, and newsletters. Speakers proclaimed the benefits of Facebook impressions, and Google AdWord clicks from podiums at every industry event across the nation. If you didn’t use Facebook and AdWords, you were a media neanderthal and would miss out on that sexy group of home buyers called Millennials. The message was being shouted from the rooftops, and it came across loud and clear, “Get on the bus or be left behind!”
To be fair, digital advertising offered some amazing benefits heretofore unavailable in the industry. The first was that ad copy and creative content could be quickly modified and deployed. Special offers, sales, incentives, discounts, and promotions could be quickly launched. Second, digital advertising offered a degree or demographic targeting that had never been available. Targeting with traditional forms of radio, tv or print was fairly broad and inexact at best. Facebook allowed a builder to target age groups, geographic areas, and even lifestyle interests. Facebook even had a “home shopper” category that a builder or developer could select. Wow! You couldn’t ever do that with a billboard. Third, the bug-a-boo in all home builder advertising and marketing, tracking, seemed easy with digital. Digital advertising alleviated the need to actually trust onsite salespeople to collect tracking data and deliver it to the marketing department. Google analytics would let any builder know exactly how many people came to their website from a Facebook ad or a Google keyword click. And, who didn’t trust Google or Facebook numbers? And finally, digital advertising was cheap, and I mean, really cheap when you compared it to print or traditional television. And because of these things, there was an intoxicating mad rush to move advertising and marketing dollars away from traditional sources into this area that seemingly checked all the boxes.
However, with the privacy issues, the recent studies about the depression that continued FB use creates (who wants sad home shoppers!), the lawsuits regarding the abuse of personal information, the rampant fraud (reported as high as 50-60%) and the number of users abandoning the platform, where do home builders go to create connections with shoppers? After all, we’ve still got to sell homes, and it looks like 2019 could be tricky with oil prices, trades, increasing material costs and climbing interest rates. Where are our 2019 buyers going to come from?
The answer is to stop hoping that shoppers discover you or your ad, and start putting your ad in front of them whenever they have demonstrated the intent to learn about new homes. Let’s face it, the very best ad in the world can’t make someone who doesn’t want to buy a home go out and buy one. You may be able to do that with sneakers, or shampoo, but you can’t do it with a house. There are just too many factors that go into the decision to buy a home. Things such as a new job, new spouse, new children, fewer children in the home, better schools and community safety all have to align in a person’s mind to create the urge to buy a house. The most successful home builder advertisers in 2019 will wait for these things to occur in a person, find that person once they’ve made a new home decision, and then deliver marketing messages to these intent-driven shoppers when they most need the information.
As far as a builder is concerned, there are two periods in every home shopper’s life; the time before they decide to buy and the time after they decide to buy. Getting your ads to a shopper during these two periods come with dramatically different costs. Targeting a person before they’ve decided to buy is cheap, and that’s because they’re just not worth that much to a builder. But once they’ve decided to buy, their value increases thousands of times over. Not everyone that drives by a billboard on the freeway listens to the popular morning radio show or checks on their high school sweetheart on Facebook is going to buy a home- even if they are in the right income and age demographic. But, chances are that there is a much high percentage of people that are visiting your competitor’s model or thumbing through home builders websites are going to buy one. Rather than spend your money trying to convince people that don’t plan to buy a home that they should buy a home, wouldn’t it be easier to find those folks who’ve already made that decision and try to convince them they should buy one of yours. Sure, they’re probably more expensive to reach, but your hit rate should be much higher.
The easiest analysis of this is the difference between the cost of getting one person in your selected “demo” to look at an ad on Facebook, which is a little over a penny, and the cost we’re willing to pay the realtor if they bring in the same person on a sale (3-6% of the price of the home). Big difference! Same person but they have a dramatically different value based on time.
Before I become the anti-digital pariah, let me say that not all digital is bad and that we at Hot On! Homes have heavily shifted our approach to engaging shoppers digitally, especially through the aggressive use of video which is what we believe separates the wheat from the chaff (digitally speaking). I also think it is as foolish to announce the end of broad digital advertising in the manner we wrote the obituaries for print, radio, and TV (and, for that matter, who needs signs or billboards with Siri on every phone!). We at Hot on! use Google AdWords and Facebook to make sure that local home shoppers know about our brand, our website and the builders and developers that we engage.
The one lesson that Facebook and Google are trying to teach us with some effect is that intent is more important than demographics. Finding someone who has already decided to buy a home, whether they’re on a new home website, in a model, or watching a local targeted TV show (I know just the one!) and convincing them to buy your home is easier, faster and more cost efficient than starting with that person from scratch!