NEW YORK (AdAge.com) -- Century 21, one of the first real-estate companies to advertise on TV, is pulling all national TV advertising in 2009 and redirecting its efforts and ad dollars to the web.
With the beleaguered real-estate market showing no signs of a turnaround, the realtor has decided to play the numbers and go where the buyers and sellers are: online.
Beverly Thorne, senior VP-marketing, Century 21, said in years past the company has spent up to half of its advertising budget on creative for TV, but a majority of that money will be redirected to its online efforts in 2009. She said the ability to target a consumer interested in making a purchase in the near term using an assortment of tactics has a lot of appeal.
According to TNS Media Intelligence, Century 21 spent $26 million on U.S. measured media in the first nine months of last year. The marketer spent $2.3 million of that online.
"There are a lot of possibilities online, not only classic display advertising but a lot of methodologies with search, enhanced listings for real-estate properties and enhanced technologies," Ms. Thorne said. "Our online investment will be spread across all of those and any other incremental innovative approaches we work out with key partners."
Not because of the economy
Ms. Thorne said Century 21's decision to shift its focus to the web was a strategic one and did not reflect the current economic situation. The company like most others, has been watching every dollar it spends "to ensure maximum return for our brokers and agents," she said.
Research from the National Association of Realtors shows that in 2008 "highly motivated" home buyers and sellers used the web as their main source of information and research. The NAR's 2008 Profile of Home Buyers and Sellers showed that most buyers started their searches online. A full 87% said they used the web to search for a home, and the same percentage ended up using a real-estate agent to make their purchase. A 60% majority of buyers said local metropolitan multiple-listing websites were their most common web resource.
Century 21 will make some local TV spots available to the 3,800 offices in its franchise system for use in their markets, Ms. Thorne said.
Leading the online push will be Beyond Interaction, Century 21's media agency of record, Ms. Thorne said. Alex Tamayo, senior partner-group account director at Beyond Interaction, the digital unit of WPP-owned MediaCom, said he could not comment on whether the agency's contract with Century 21 had been altered as a result of the increased workload it would be handling. He said there's "nothing new about clients wanting to make sure every dollar is working, and working better than it did last year, so we are always reviewing the media mix."
And an increase in workload won't be much of a change, he said. "They keep us pretty busy as it is."
Still some offline work
McGarryBowen, which has been Century 21's creative agency since 2005, will be working with Beyond Interaction on projects. McGarryBowen will not see a dramatic decline in its workload, Ms. Thorne said. She said Century 21 will continue to do a limited amount of offline work such as out of home, radio and selective print, which will be integrated with the company's online efforts.
"It will be different type of production, but it will be production work," Ms. Thorne said. "They are also doing some of the integrated campaigns we do in local markets with brokers. It's just a change in the business and not really a reduction."
Ken Toumey, account integration director for McGarryBowen on the Century 21 account, said revenue from Century 21 is expected to fall but not dramatically, and that the agency will become much more focused on helping the realtor generate leads.
"That's the switch for us," Mr. Toumey said. "We are going spend a lot of time on more strategic work that cuts across their entire marketing platform, and we are now much more of a strategic partner with Century 21 than ever before."
Relatively easy decision
Century 21's decision to pull all national TV advertising was reached relatively easily based on data it compiled in 2008 and 2007, Ms. Thorne said. She said the company's research and testing revealed that its online investments in 2008 were substantively more productive and efficient than its offline efforts.
"In 2008, our year-over-year results from 2007 are that we saw a 237% increase in the number of leads we were able to produce for our brokers and agents," Ms. Thorne said. "At the same time, our cost per lead dropped 62% year over year because we learned how to integrate our search methodologies with our display and enhanced listings to create a far more targeted and efficient lead process. Our decision from there was very clear."
Ms. Thorne would not say whether the shift would continue into 2010, only that the company will continue to invest ad dollars in media that consistently drive qualified leads to its brokers and agents.