It better be.  According to a recent study published by the National Association of Realtors and supplemented on MarketingCharts, 87% of home buyers start online.  While this is no surprise to Internet Marketing professionals there has been some inconsistency in this percentage over the last four years depending on who you talk to in the real estate industry.  Now we know.

Here’s the skinny:

• 87% of home buyers used the internet to search for a home purchased through a real estate agent,
• 72% of non-internet users were more likely to purchase in a private transaction directly from a builder or from an owner they already knew.

What information source did home buyers use:

• 87% Internet
• 85% Real-estate agents
• 62% Yard signs
• 48% Open houses
• 47% Print or newspaper ads
• Fewer buyers relied on home books or magazines, home builders, television, billboards and
  relocation companies.

When asked where home buyers first learned about the home they purchased:

• 34% said a real-estate agent;
• 32% cited the internet;
• 15% said yard signs;
• 7% said from a friend, neighbor or relative;
• 7% said home builders;
• 3% said from a print or newspaper ad;
• 2% learned directly from the seller;
• 1% from a home book or magazine.

Bottom line is that while the real estate industry has remained pretty traditional in method - using an agent, driving around looking at neighborhoods and finding open houses - online is and has been playing a significant role as an information resource to home buyers and you must be there to take advantage of it.  No online marketing company is going to tell you they will sell homes for you, and if they do, you shouldn’t believe them.  Hiring professionals to put together an online strategy that can be incorporated into your marketing plan will be the best bet.  The key is visibility, online presence, and lead generation.  Home buyers want to find the perfect home, and you might just have it, but you’ve got to be online so they can find you, thus providing a forum for them to reach out to you and visa versa.

Get the most up to date Real Estate stats regarding:
First Time Home-Buyers, Current Down Payments, Agent usage by Buyers and Sellers, Foreclosure Purchases, Features and Incentives,  and Additional Demographic Information by reading the full article at MarketingCharts.

About the study:
The 2008 National Association of Realtors Profile of Home Buyers and Sellers is the latest in a series of large national NAR surveys evaluating demographics, marketing, preferences and experiences of home buyers and sellers. NAR mailed an eight-page questionnaire in August 2008 to a national sample of 133,000 home buyers and sellers who purchased their homes between July 2007 and June 2008, according to county records. There were 10,053 usable responses and the adjusted response rate was 7.9%. All formation is characteristic of the 12-month period ending in June 2008 with the exception of income data, which are for 2007. Because of rounding and omissions for space, percentage distributions for some findings may not
add up to 100 percent.

What makes a good Search Marketing Firm?

As a business owner, CMO or Marketing Director, the choice of a Search Marketing Firm will be one of your most important decisions.  In order to fully realize the benefits of Search Marketing, it is crucial to understand what role Search Marketing will play in your organization and choose a service provider that supports this role.

What is the focus of the Firm?

It is very important to understand what the prospective service provider specializes in.  Lately, it seems that everyone is getting into Search Marketing.  There are hosting companies, web design firms, web development shops and traditional agencies all trying to get a piece of the market.  It is often the case that no firm can do it all, or at least not do it all well.   It is best to choose a firm that specializes in Search Marketing.  There is no strong argument for using your web developer or your hosting company for your paid search management to keep it under one roof.  The worst combination is a traditional advertising agency that offers Search Marketing services.  That is like getting heart surgery from your pharmacist, they may have heard about it, maybe even read about it, and may be able to talk the talk, but they don’t do it day in and day out.   No matter what type of firm you are talking to, ask them who will be managing and performing the Search Marketing work.  Is it handled in-house or outsourced to another firm?

How do they view Search Marketing?

Do they believe that one aspect of Search Marketing is more important than the other?  Or do they believe that all initiatives work together and view search holistically?  As you interview service providers it is highly recommended to learn a little about the space.  You don’t have to become an expert, just have some basic knowledge.  Unfortunately there are a lot of charlatan’s and snake oil salesman out there.  By doing an hour or so of prep work on your own, you’ll find it is much easier to avoid many of these scammers.

What are their Search Engine Optimization tactics?

White Hat or Black Hat?  Learn this terminology, especially if your company’s reputation and long term success are important.  Basically White Hat SEO Firms play by the rules of the search engines and understand the uncertainty involved in playing by the rules.  Black Hat SEO Firms will tout quick and/or guaranteed results.  Never has it been more accurate that “If it seems too good to be true, it probably is.”  Black Hat SEO Firms stretch the rules and manipulate them often to the eventual detriment of their clients.  There is nothing wrong with preferring the Black Hat Route, it does work, usually, but not for long.  Getting banned from Google is real, and blaming it on an SEO firm will not get any sympathy or get you back in.  Make sure you know which side of the fence they are on.

What is their Paid Search Pitch?

Are they guaranteeing clicks, traffic or sales?  Ask how.  Beware of the “We have a relationship with Google”.  I get cold calls on my cell phone from firms claiming this all the time; some of the pitches are quite smooth.  If they had a relationship with Google they wouldn’t be talking to you or offering services, they would be using their relationship for their own benefit.  Saying they know a guy at Google is like knowing a guy at the Lottery Commission.  It is common for an agency to have a Rep at Google, we do too, but that does not in any way indicate an inside track or special arrangement.  Beware the Google Partners or Resellers claim; that means they make a cut off your Paid Search spend.

Do they stress bid management and special software as their competitive edge?  While this was the answer many years ago, times have changed.  Every major Paid Search venue uses some variation of a quality score and smart pricing.  This means that the entire campaign from keyword to landing page needs to be tested and managed, not just the bids.

If fact, the bids are pretty much the least important factor since they are derivative of the account performance as a whole.  Google made $16.4 billion last year from people clicking on ads.  They don’t care if you bid a million dollars a click; if your account has low relevancy to the search term your ad won’t show. If you have a significant spend budget in a highly competitive and fast moving niche there can be a benefit to bid management tools, but only as an enhancement to active management, not a replacement.

And another thing; taking Google or Yahoo! or MSNs advice on how to manage a campaign, or worse yet having them manage the campaign is like having the IRS do your taxes.  Enough said.

An analysis of the Scottrade conversion path and why they get two thumbs up from Liberty Interactive Marketing.

Their process goes something like this:
1. Searched “scottrade” in Google, they are running PPC for their branded term. Smart. Also, they show up #1 for their own company term. They’ve been awarded sitelinks from Google, those are the links below their listing in the organic - login, branch office locator, etc.

2. Login and open a new account are NOT hard to find! Thank you.

3. One criticism is when you hit “open an account” the form is a popup instead of just opening in a new window or taking you off the page.  Also, there are no question mark links (?) to help you select what type of account you want.  This is where I stopped, but the smart thing is that Scottrade asked for just some brief information about me prior to getting into the details of the account preferences and selection.  Why is this smart? Because this is a friction point. I stopped because I didn’t have the answer.  The next day I received a phone call from Joel, the Branch Manager hoping to help me out with completing my account setup.  I figured out the answer so I didn’t need to call him back.  Two days later I still hadn’t completed my account set up, but in the mail I received a PERSONALIZED booklet from Scottrade offering an offline way to complete my account setup! Wow, A) thanks for reminding me and B) thanks for helping me out if I didn’t feel comfortable completing it online.

4. The next week I finally completed my account setup online, what can I say I was busy.  The only portion I was unable to complete was linking my bank account.  Friction point.  Low and behold, I received another phone call from Joel, the Branch Manager (not a different person, the same person!!).  His voicemail offered to provide me with options for helping me set up my account for funding and  when I didn’t return his call, I received a paritally filled out form so help me along the process WITH A SELF-ADDRESSED POSTAGE APPLIED ENVELOPE! Thank you. It’s like my soccer coach always said “You can’t have control of the ball if you just stand around waiting for it to come to you, you must go to the ball to make things happen.”  Scottrade was bringing the proverbial “soccer ball” to them and it worked.

Why do I feel good about this persistence aka customer service? Because Scottrade found the right mix of online and offlline initiatives. They didn’t bug me until I was blue in the face and turned off from the process.  Their methodology and flow was more like reading my mind because they were aware of the friction points within their conversion process.

How you can get there?
1. Start with your Web site, ask friends, family, strangers to use your site and ask them to complete your desired goal for them, if you are serious about investing in your online customer experience, contact us or  Red Flag Consulting

2. Determine friction points throughout your conversion funnel/process, are they something that can be fixed online or do they require offline operations/interference to get customers to the end goal? Determine solutions, time and effort. Rethink your process if necessary, just because it isn’t broken doesn’t mean it can’t be improved! Raising conversions even .5% can have a serious impact on business.

3. Talk to your customers, listen to your customers, find out what went wrong, what worked, etc. Make changes and test!

4. Keep testing, if you find that your conversion process is half online and half offline find the right mix of phone calls, emails, direct mail.  You’re bound to tick some people off but at least you will learn if you are willing to listen.

4. Implement online marketing strategies, test landing pages and your process from all lead sources.

5. Listen, learn, test, repeat.

6. Feel comfortable with not being able to please everyone; please the majority, the right majority and you will remain on the right track.

Congrats to Scottrade for an excellent example of how to get customers through your conversion funnel, understanding that there were friction points along the way and knowing how to solve those to get customers to complete their desired task, as well as yours.