Ceating an engagement index for real estate websites

As an increasing number of real estate firms seek to embrace and integrate Web 2.0 principles in to their websites, many of these firms may encounter a sense of frustration in having to “upgrade” once again to meet, or exceed, customer expectations regarding Internet-based services. Is real estate an Internet based service? Absolutely. With over 70% of real estate searches beginning on the Internet, real estate is decidedly an Internet-based services industry. But what kind of Internet-based services industry?

Rather than an “execute on what I already know” process, real estate is more weighted to a “search and gather” process. Few customers, in one search session, find a home, contact an agent, book a showing, and buy a house the next day. The majority of consumers spend several months, on average, searching for homes, viewing listings, compiling research, and saving preferred property listings before even registering with a firm or contacting an agent (i.e., searching and gathering). And real estate firms have tried to facilitate this search and gather process with their registration systems, drip marketing services, and online appointment making processes. But these tools align more with the “execute on what I already know” (i.e., utilitarian) aspect of the home search process; that is, these elements do not really help a customer determine what attributes to search for in home or community.

So, what should firms do to engage customers earlier and mid-way through the process to facilitate a higher degree of interaction with, and reliance on, the firm’s website to help a consumer define attributes? One way to begin is to set key performance indicators and develop an engagement index.

Creating an engagement index is a great way to assess overall site responsiveness to consumers’ search needs. Eric T. Peterson defines engagement as

Engagement is an estimate of the degree and depth of visitor interaction on the site against a clearly defined set of goals.

He has written a great series of posts on this topic. Part V of his series steps readers through the application of his process. Jeremiah Owyang adds some additional considerations here and here. And this blog actually walks through how to calculate “influence”.

Although these concepts in analytics may seem arcane, by focusing on such, real estate firms can begin the process of smoothly, logically, and economically moving their sites into the realm of Web 2.0. In future posts, I will explore how real estate firms may begin to create and apply an engagement index, and what elements they should focus on measuring regarding such.

Engagement marketing, using social media in real estate

According to McKinsey, global companies are increasingly using Web 2.0 technologies to engage their customers. Tapping web services, collective intelligence systems, and peer-to-peer network capabilities were the top three technologies companies were currently deploying or planning to deploy. Respondents indicated that customer acquisition was the number one reason they were deploying social media (the respondents also stated that they use Web 2.o media to more efficiently engage partners and suppliers as well as internal collaborative purposes). Several respondents indicated that social media is particularly valuable in terms of ideation and creation of future products.

In a similar report, McKinsey interviews Cammie Dunaway. Ms. Dunaway indicates that Yahoo’s concept of digital salons (online focus groups) have delivered unprecedented success with respect to new product prototypes and new product development initiatives. Yahoo also measures consumer engagement as a success metric (i.e., share of time spent on Yahoo and the number of media properties “consumed” during this time).

Applying social media to real estate home search is a logical step. Real estate firms should begin experimenting with new forms of engagement. Despite the fact that homes are not commodities novel opportunities exist to deploy social media. Virtual renderings of homes (pictures, virtual tours, etc) offer a rich bed of experimentation and engagement opportunities, and there currently exists technology real estate firms can deploy to support this initiative. For example, Benjamin Moore has a tool where consumers can select templates or upload pictures of their own homes and then change color schemes; Halstead Property has deployed a similar tool. There are 3-D home design platforms available.

 A creative firm could move beyond the virtual tour and allow consumers to actually change the color and layout of a prospective home; or grab widgets that have predefined parameters pertaining to build-outs or additions, thereby allowing consumers to visualize how a home would appear after the completion of such. Rounding out the experience, a firm could allow an agent, or team of agents, to answer questions via live chat and have a local interior design consultants “on call” to do the same. These types of consumer-facing features not only meet the consumer engagement parameters explored by McKinsey, but actually allows consumers to design or alter a product so they can visualize, experience, and “feel” how a home will look after purchase (allowing a consumer to virtually move in to the home and get a deeper sense of the living space). As Mini Cooper and Scion have found, the higher consumer engagement, the higher the return on customer acquisition strategies (measured in engagement and brand loyalty).