By: Lucia Moses At the height of the dot-com boom, real-estate Web sites, in a hurry to build up their content, paid for Multiple Listings Services' inventory. This reversal of the advertiser-media relationship caused newspapers to squirm, but brokers couldn't have been happier.
"Brokers and MLSs felt as if, 'It's finally our chance to ... make some money and control our marketing costs,'" said Pete Conti, partner with the Portsmouth, Va.-based Borrell Associates consultancy.
Like so many gimmicks of the time, this practice had a shaky foundation. Last week, the Microsoft Corp.'s MSN House & Home showed hundreds of brokers and multiple-listings services the door, its paid-listings model having been proved unsupportable.
Where does this leave newspapers eager to attract online home shoppers? Peter M. Zollman, founder of the Classified Intelligence LLC consultancy based in Alamonte Springs, Fla., said papers should have an easier time striking alliances with the real-estate community because the MSN development "reduces the leverage that the MLSs have."
Both sides have something to offer. The MLSs have extensive listings, which are highly important to online home shoppers but lacking on many newspaper Web sites, according to Borrell research set to be published this month.
Newspaper sites, meanwhile, are well-trafficked by news and information seekers. "In almost every local market, the newspaper is still the leading local Web site," Conti said.
That said, brokers have grown so bitter over ad-rate increases that a newspaper seeking an alliance might get the door slammed in its face. In an effort to break their dependence on newspapers, brokers are training their agents to convince home sellers that newspaper classifieds are an ineffective advertising tool. Others are starting their own publications. In Des Moines, Iowa, three brokers last fall pulled most of their local newspaper ads and started a direct-mail home-advertising publication.
"Newspapers have treated brokers like they were someone's chattel for so long," said Steve Murray, president of Littleton, Colo.-based Murray Consulting, adviser to the real-estate community. "They got pushed too far."
Softening real-estate revenue might direct more attention to the category this year. The hot real-estate market propelled a robust 4.5% increase in newspaper real-estate advertising last year, but analysts expect slower growth this year. As with all advertising, newspapers need to think of ways their sites can generate leads for brokers, analysts advised. With people looking for homes online 24/7, Conti said, "Newspapers have to shift into a mind-set of continuous marketing of homes."
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