Why your builder should love the internet

Posted by
Mike Lyon
Date
 March 22, 2007

Hopefully, you do not need convincing as to why you need to implement or improve your online sales program. However, it is always good to look at the facts and forecast the future to adapt your program for things to come.

Let’s take a look at a few of these facts directly related to the homebuilding industry:

  • Over 80% of homebuyers start their home search online That is a large percentage of your exact market. Shoppers are also frequenting the website more often to research a potential purchase and to look for additional information over their entire sales cycle.
  • Over 27% of American adults use the internet to research real estateThis is a large portion of the adult population. This number has doubled since 2000 and is only increasing as the use of the internet increases.
  • Homebuilders determined that the highest quality leads come from their websiteOnline customers are more informed, serious shoppers who can make a quicker decision than walk in traffic. Specifically, online customers who have been qualified and well taken care of tend to write a contract 30% of the time.
  • The faster you follow up with a customer, the more likely they are to purchaseWhen a customer receives a fast and courteous response to an online request, the conversion ratio increases dramatically. This is not easily accomplished by the traditional onsite sales agent.
  • Builders are not allocating enough marketing dollars to online sources to keep up with the demandStudies show the lack of marketing dollars allocated to online marketing. Similar studies also show that the amount spent for online marketing will almost double by 2010.
  • Less than 10% of builders have a dedicated person to handle leads from online sourcesLeads are coming in over the web with little to no conversions because builders are not handling them quickly or effectively. A large segment of the market is undervalued.

Builders must anticipate the increase of online shoppers and the growing expectations for these potential homebuyers.

A recent survey conducted for the National Association of Home Builders Institute of Residential Marketing by Harris Interactive suggests that builders need to boost their online-marketing dollar allocations and improve their Internet presence. This study also revealed alarming trends in the lack of online contact from the builder to the consumer. Builders are missing an easy opportunity to connect with the target audience and would benefit by having a staff person dedicated to handling Internet leads and only 8 percent of participating builders claimed having a dedicated Internet salesperson to handle leads.

This revealing study is screaming one thing loud and clear – most homebuilders are not taking advantage of the large amount of people searching online for their new home. The exciting news is that there is an immense amount of opportunity for builders who are willing to channel their marketing efforts where the buyers are. Not only that, but builders put a program in place to effectively manage online customers will be well ahead of their competition.

A second study by the Pew Internet & American Life Project conducted in 2006 shows the increasing numbers of internet users who are using the web to research their next residence. The study shows that 39% of internet users have looked online for information about a place to live – double the overall number of Americans who had done so in 2000. This number has steadily increased over the past six years and is poised to increase at a higher rate.

Not only that, more than half of internet users ages 19-29 use the web to research housing. This is a forecast of things to come. Those who have grown up in the information age will be more likely to start their search online. Are you ready for those customers? The real question is, will you evolve to deliver on this new buyer’s expectations. The same old song and dance will not work anymore.