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When retargeting makes all the difference in real estate

Advertising is not a new concept at all in the world of people trying to sell their products. Through the ages, everything from pamphlets and flyers to TV commercials and billboards has helped make brands and products alike become noticed by the masses.

The real estate market is a special case in terms of advertising

If we look at it historically, advertising quickly went from scattershot to targeted, with posters and billboards being in the areas where the intended audience would otherwise congregate. As new mediums appeared, people would advertise for cooking machines in housewife magazines and tools in TV commercials appearing between shows aimed at the more handy segment. As each new medium appeared, advertising would adapt and evolve to increase reach and attempt to become the most noticeable ad in its segment and placement. In modern times, we began seeing ads on the internet and this has now become one of the most favored places to advertise, both for brand awareness as well as specific items.

The real estate market is a very special case when it comes to advertising. Unlike shampoo and hotdogs, houses are not exactly a highly mobile product, meaning product advertising on a national level does not make sense.

Thus, advertising needs to take a different turn, a fact that is exacerbated by the fact that any real estate agency’s portfolio tends to be highly varied, with each property being a distinct product with a fairly small segment of their total audience being actually sensible targets. Historically this has been solved by displaying a variety of properties in windows, high profile properties in local newspapers, and sending out newspaper-style catalogs of their current stock to the local area.

The real estate market is a very special case when it comes to advertising. Unlike shampoo and hotdogs, houses are not exactly a highly mobile product, meaning product advertising on a national level does not make sense.

Today, we can present banners on a much more likely-to-be-useful scale

Enter the modern internet. In the old days, advertising was basic and simply meant to hit wide for little money. Banners were everywhere and more animated shockwave ads than you could shake a proverbial ton of sticks at. The goal was simple: cast a wide enough net and maybe you succeeded. If you wanted to advertise for toys, you would buy ad space on websites for kids or parents. The same goes for gardening tools and cars, but again, you would have very limited space for property advertising, as most sites were not local, leaving you with only the local newspaper if they even had an online presence. But this has changed as we get better and better underlying technology.

Modern advertising targeting is spread into essentially two categories: statistical assumptions and hard facts. For the modern-day banner advertising, it is an infrastructure not unlike that of stockbroker systems.

High-volume, low-latency communication is a must, as every time a webpage with banner ads is loaded, the page then communicates with a broker. The broker offers the ad space to anyone subscribed and they, in turn, have just milliseconds to not only decide IF they are interested, but also place a bid. The broker then determines a winner and bills them while sending their ads to the webpage to be presented to the user. The broker will send information along with the offer to bid on a space, such as which browser the user is using, cookies they have access to, location and other generic information. This can be used by each advertiser to statistically determine information about the user who will ultimately see the ad: gender, location, age, income bracket, likely interests, etc.

Modern advertising targeting is spread into essentially two categories: statistical assumptions and hard facts. For the modern-day banner advertising, it is an infrastructure not unlike that of stockbroker systems.

Based on this information, we can now present banners on a much more likely-to-be-useful scale. If we are selling a house, we can decide to show only to requests from a given geographic area and if it is a small, one-room apartment, then aim for young, single people, while a large house can be aimed at older, married-with-kids couples.

The big problem here, however, is that it is still all statistical, meaning we do not know anything for sure, but only if we show 10.000 of these adds, we can somewhat hit our target group. 

This is somewhat offset by the low price of banner ads, but people rarely click them these days. For that reason, banner ads are mainly useful for branding and for retargeting to keep a specific property in mind of a potential buyer.

The big problem here, however, is that it is still all statistical, meaning we do not know anything for sure, but only if we show 10.000 of these adds, we can somewhat hit our target group. 

The platforms we use daily know a lot about us.. 

So, what is retargeting? Well, to get to this, let’s back up and at first look at the other type of main advertising, we see online these days: hard facts targeting. Multiple platforms know much, much more about us than random newspapers online site or a forum for cat-lovers.

Facebook, LinkedIn, Google – all of them have massive amounts of data about our interests. Some we give to them actively, filling out profiles on their platforms, while other data is calculated by datamining our posts, messages and looking at data harvested by embedding cookies on partner sites across the web. This all sounds dark, damning and stalkerish, but in actuality, it is much less invasive than we think.
There isn’t someone sitting behind a desk in a dark room stalking us, just algorithms acquiring data and recombining it to target us with specific ads, which is the very foundation upon which these companies are built.

It means, that we as advertisers, have a lot more knobs to turn when optimizing delivery, and the viewers see much more relevant content. As a single guy in his 30’s who loves cats, gardening, and motorcycles, I prefer to see ads on these topics compared to random ads for retirement homes, diapers and mascara.

Ads feel less intrusive and, as a result, we pay more attention to them. These platforms have explicit knowledge and extrapolated knowledge about us that borders to explicit. As a result, we can tell them exactly the segments we wish to target: for an apartment in the city with 2 bedrooms and a small kitchen, we can aim for students and young, single professionals, while a 4 bedroom house in the suburbs should be aimed at families with children and smaller houses with smaller gardens at people looking to retire to a smaller house as the children fly the coop.

This knowledge is often accompanied by the recipients address (we never see this information, we simply choose target groups, areas and interests, the platforms then use their proprietary knowledge to do the rest), allowing us to ensure our ads hit people living in the areas we wish to target, rather than relying on IP origins, which can be misleading for non-static IP addresses, obscured by VPN’s and when on a phone, you can hit people simply moving through an area while traveling.

It means, that we as advertisers, have a lot more knobs to turn when optimizing delivery, and the viewers see much more relevant content. As a single guy in his 30’s who loves cats, gardening, and motorcycles, I prefer to see ads on these topics compared to random ads for retirement homes, diapers and mascara.

Once we compare the two methods, we get the following comparators: banners are cheap but tend to be more scattershot and rely on statistics to assume things such as gender, income bracket, and occupation and their original location can be wrong for multiple reasons. On the other hand, we have social media ads, that are much more expensive, but also much more spot-on. At the end of the day, the cost per click can vary but is often in favor of social media. So why, then, would we even bother with banner ads? The answer here is the aforementioned re-targeting concept.

Retargeting not only makes click rates sky-rocket, it also keep the property fresh in the buyer’s mind

To explain what retargeting is and how it works, we need to start with cookies, more specifically the often-villainized tracking cookies. When a user visits a site, many sites place a cookie in their browser that details where they came from, gives them a unique cookie ID and registers which subpages the user was on. When we advertise, we often place cookies from third parties, that is to say, our advertising partners. This is why going to a random Buzzfeed article often results in 5-10 different tracking cookies from their advertisers.

The information of our tracking cookies is passed along whenever a request is made for a new page, so the ad brokers can let us know that we are not just bidding on ad space with a given set of stats, but also let us know the cookie information. And this is where things get interesting. Now we can start retargeting our ads, that is, someone who already showed interest by either clicking another ad or looking at our site organically can now be given ads based on the information we already have.

So if we have someone who already looked at a house, we can show it again to remind them of it, which makes click rates sky-rocket, but also helps keep the property fresh in their mind. If the property is sold, we can show them similar properties in the same areas they have already looked in. This means we can up our bids on specific users in order to get better results and raise awareness of our properties, keep them at the top of their mind, and increase brand awareness.

This also means that, as actors in the real estate market, we need to reconsider how we advertise: with specific products for only small segments in very localized areas, we need to know WHO to target WHERE.

So if we have someone who already looked at a house, we can show it again to remind them of it, which makes click rates sky-rocket, but also helps keep the property fresh in their mind.

If we want to sell a summerhouse, we need to advertise in the area’s people that buy summer houses live, not in the summer house area, where people already own one (or, at least, not solely). If we want to sell a house in the suburbs for a new family, we need to target the inner city, where people live before they start a family. But this should be done using platforms that guarantee this explicit knowledge about users. Once they then show interest in properties and we have cookies to track that interest, we can start retargeting them with banner ads for the properties that they have already shown interest in and like properties in the same areas.

This also means that, as actors in the real estate market, we need to reconsider how we advertise: with specific products for only small segments in very localized areas, we need to know WHO to target WHERE.

Switch the budget for brand awareness

For brand awareness, we should shift the budget for banners from the regular scattershot to more targeted: while some scattershot can be useful when prices are low, much more should be spent targeting people that have simply accessed our site within the past few months, indicating they have some interest in the housing market.
This means that we can again use the explicit knowledge from social media advertising to increase the effect of our banners, allowing them to be part of a more targeted campaign, yielding better results for us all.
For brand awareness, we should also keep another thing in mind: the old paradigm of clicks per dollar spent is not useful in these cases.

When we wish to raise brand awareness, clicks and likes do not matter, instead, we should look at the hits on our homepage in the next few months and compare them to the same period without brand awareness campaigns.

Branding awareness is where banners really shine for our industry, but many people are too afraid to commit because the results look paltry compared to housing campaigns. Keeping in mind that this is comparing apples to oranges should allow the user to more correctly expand the parameters, they evaluate campaign effectiveness on, in turn yielding much a better understanding of the products and results they can offer.

When we wish to raise brand awareness, clicks and likes do not matter, instead, we should look at the hits on our homepage in the next few months and compare them to the same period without brand awareness campaigns.

Think differently than traditional online marketing

In conclusion, we are in an industry that can benefit greatly from online advertising, but in order to advertise effectively, we need to think differently than traditional online marketing does. The results, however, are proving to be strong, and through the magic of explicit knowledge enabling efficient retargeting, we can get much better results, while simultaneously presenting the user with relevant material.

Written by Shine Team lead, Peter Nellemann

 

 

 

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