Data Secrets of Brand Builders
How to Mine Real Estate Data for Marketing Gold
Can you imagine the positive impact that consistent, positive headline news coverage would have on your sales and public awareness of your brand? Learn how to create a data communications program that catapults you to the top of the real estate industry.
Data Secrets of Brand Builders
How to Mine Real Estate Data for Marketing Gold
RealtyTrac was a little-known website providing foreclosure listings to a small number of real estate investors and professionals when, in the first quarter of 2005, it issued the first public report on national foreclosure activity. Within a year the greatest flood of foreclosures in the history of American housing began. The rest, as they say, is history.
Every month RealtyTrac issued new data chronicling the explosion of foreclosures. Every month it was cited in more and more major news outlets until its name became a household word, synonymous with the Foreclosure Era. Today its brand has become as widely known as any in real estate.
RealtyTrac’s success illustrates how a company or website can catapult its brand into a leadership position that builds traffic, sells services and subscriptions, and positions executives as experts on the national scene by making the most of the data that passes through its portals.
For generations, residential real estate was virtually a black hole of information, with few hard facts and statistics available to consumers to help them make extremely important financial decisions. The housing boom and bust placed America’s real estate economy front and center. The media is starved for hard data that helps consumers, industry professionals, financial services and policy makers understand current trends.
The information flowing through real estate listing sites, transaction platforms, origination engines, rental sites and other sources illustrates current market trends and helps consumers and professionals better manage the home sales transaction. Realtor.com, ForeclosureRadar, Zillow, Redfin, LPS, CoreLogic and ClearCapital and are just a few of the companies that are turning the analytics in their databases into public relations gold. Those that succeeded found that repeated and prominent coverage of their data transformed public perceptions and built their businesses.
Here are some of the most recent ways web sites and companies are making news by thinking creatively about their data:
- To measure buyer interest early in the transaction process, including multiple bids, a leading lockbox company is collecting and sharing data from foot traffic.
- Rental “kayak” sites that aggregate rental listings from a number of sources capture enough data on a national level to provide initial reads on rental trends, such as median rents for single family homes, are experimenting with reporting rental metrics like median prices, turnover rates and vacancy rates.
- Listing sites and MLSs may be able to augment our ability to understand market changes by tracking new listings, re-listings, price changes and expired listings.
- Ellie Mae, the mortgage servicer that processes more than 2 million mortgages a month, recently began releasing monthly data from its platforms that show median FICO scores, loan-to-value ratios and debt-to-income ratios for different loan types, including FHA and jumbos, providing consumers exact information on what it takes to qualify.
- Coldwell Banker has begun sharing data from its national web site with reporters, providing search data that illustrates consumers’ interest in house sizes and use of mobile applications.
- Realtor.com identifies “Top Turnaround” markets every quarter from an index it created utilizing its own data, including changes in inventories and list prices, age of inventory, the ratio of searched to inventory size and other factors.
Hundreds of other real estate organizations, including listing aggregators, brokerages, franchises, mortgage platforms, home builders, multifamily owners and developers, mortgage servicers, appraisal management companies, remodeling contractors, data providers, lenders, and trade associations could have data sources that would make effective data communications programs.
What Makes News
Successful data communications programs begin with an understanding of what the news media might be looking for in the general areas in which you can provide data. Once you know whether the hole is round or square, you can often shape your data offerings to fit.
Here are some guidelines on how to get good coverage.
Consumer Interest. The more you package your data with consumers in mind, the more appealing it will be to reporters. How can your information help consumers make home buying and selling decisions, such as when to buy or what kind of mortgage to take out? Price, sales and inventory data are more consumer-friendly the more localized, so be sure to address local markets. Data on the mortgage origination process should be presented in a way that helps consumers decide such questions as what kind of loan to take out and how much to put down.
News Value. To make news, your data must be representative of an aspect of a real estate activity at a local, regional or national level. Transaction platforms that are dominant or near-dominant in certain areas like short sales, REOs, GFEs, FHA or the federal relief programs like HAMP and HARP can assemble data that are representative of activity at a national level. Pay attention to what reporters are covering and see if your data fit, like RealtyTrac’s reports fit perfectly into reporters’ needs for a way to track foreclosures at national and local levels. News means new. Fresh, timely, current data on sales, prices, inventories, distress sales and market trends will get more coverage than aging information. When your data program is up and running, you will want to use your news releases and commentary to help reporters understand how your data contribute to ongoing news stories. All real estate is local. Providing state-by-state or local market tables will multiply pick-up of a national data report. Regional and local market reports are often timed to complement a national report like NAR’s pending or existing home sales or Case-Shiller’s home price indices. You can augment news interest by creating value-added reports from your database, like Realtor.com’s “Top Turnaround Towns.”
Uniqueness. Every month real estate reporters receive at least a dozen national price and sales reports. Those that are most established, like Case-Shiller, and those that are most timely, like Realtor.com, get covered more than others. If you are going to compete with these, can you make yours even more timely? Better yet, can you carve out for yourself a niche others ignore, like inventories or time on market? Appraisal management companies and mortgage services are discovering that they have data no one else seems to publicize in a timely fashion, like median FICO scores, down payments and approval rate, and they are staking out new territory for their brands by creating reports that make news.
Context and Interpretation. Some companies issue only a spread sheet or few graphs and they wonder why they don’t get more coverage. Even a news release is often not enough. Reporters aren’t housing economists. They expect to receive a report commentary as well as the numbers that put the data in perspective and helps them understand what’s newsworthy about a report. Do you have more than one news story in your data? Bring out every trend and finding you think is newsworthy and you will find that the more you give reporters to work with, the more coverage you will get. In time, you will want to consider a push newsletter and/or a blog to add depth and additional coverage to your program. These channels are great ways to surface and comment on findings in your data that aren’t hard news.
Quality. The quality of your data must pass muster. Bias is often unavoidable but should be disclosed. For example, if you are a brokerage that specializes in a segment, like luxury, or serve a certain clientele like military families, your web site data might provide an interesting and newsworthy picture of your specialty, but not necessarily of the local market as a whole. If your data is at all complicated, consider bringing in a consulting economist or statistician. If you have current and valid data of a sufficient volume to track trends, chances are good an expert can design a program that will pass muster. Good ones also can identify news opportunities and draft commentaries to accompany your reports.
Timing. The major real estate data releases post their release times months, sometime years in advance. You can look them up and avoid issuing your data at the same time, unless you have something closely related like local data that complement a national sales or price series. Unfortunately there is no way to know when many lesser data releases will come out. What you can do to increase coverage and get attention in advance is to issue a media advisory two to four days ahead of time with some teaser information that will encourage editors and reporters to make room for your story.
Exclusive First Use. If your story is good enough, you can lock in big league coverage in advance by offering an exclusive first use to a national outlet like a wire service, syndicate, network or major daily newspaper. To do so, you need to make your report available in advance and protect your media partner from any other outlet using it first.
Don’t Make These Mistakes
As many companies experiment with making data available, some are making mistakes that cost them credibility rather than winning coverage. Learn from their mistakes.
Make a News Story. Don’t just release a bunch of numbers to see what sticks. Take the next step. Put together a news story that reporters can use. Cut backs in news media budgets have depleted the ranks of real estate reporters and many are thinly stretched. Make their jobs easier by positioning your data as a story that fits their news agenda with a news release, cover memo, or email with your data attached.
Don’t Use Data to Make Self-serving Statements. Just because you’ve got some data behind you, don’t make hard core marketing statements. You’ll ruin your chances with journalists and possibly cripple your credibility far into the future. For example, don’t expect news coverage if you issue a release that more consumers are visiting your site. On the other hand, if the monthly Media Matrix numbers show you moving up quickly in your category, reporters are more likely to cover it because they trust the source. Using your data to blatantly self-promote yourself is are not only a wasted effort, you could compromise your trustworthiness with journalists.
Take a longer view. Be creative and subtle. Look for ways to position your brand on top of the mountain by using your data to communicate expertise . Take the high road and good things will happen.
It’s fair to ask what good is a data program if you can’t use it to pat yourself on the back. The whole point of building a data communications program is to elevate your brand above the competition. When you succeed, you’ll have a more credible, more recognized, more powerful brand that will make it possible for you to do many things more effectively, including marketing your products and services. However, if you compromise the effort to establish credibility for your data program by using data to directly “prove” the popularity or quality of your services, you will never get there.
Be Ready to Back Up Your Findings. It’s not enough to issue a news release citing numbers you have gleaned from your database. Reporters will want to see your tables or spread sheets. It’s not that they don’t trust you, (though they may not), they want to see how you came up with your news-making numbers. Perhaps you are over stating or misstating. Perhaps you made an error, especially if you are new at it. After all, once a reporter’s story is published, their credibility is on the line as much as yours.
Don’t Air Your Quality Issues with the World. When you issue data, journalists will not automatically assume you know what you are doing. The more lackadaisical you go about it, the more they will question your quality. If you make statements and can’t, or won’t, back them up with tables, don’t be surprised when reporters take a pass. Should you come upon an anomaly in your data such as a home price that seems too high or a major finding that directly contradicts what someone else has issued, check it out and find out what’s going on. Take the time to do your due diligence before your data go public. Check your data rigorously. Correct it as soon as you find an error. There are few greater PR nightmares than having to explain bad data after it has been released. Whatever you say will damage the credibility of your efforts, perhaps permanently.
Good News/Bad News. There will be times when your data might not be what your customers want to hear. We all wish that markets were healthy, values improving, financing available and foreclosures declining. However, that is not always the case. You cannot operate a credible data program without an understanding that you are only the messenger, and that if a little rain falls today, the sun will shine tomorrow. Resist pressure to compromise your data or “spin” your results. You cannot build a brand that has integrity without acting with integrity.
Profile of a Successful Program
Outlined below is what a successful program might look like. Not all these activities will work with every company, but the variety provides a picture of the communications opportunities an effective program creates.
Monthly/Quarterly Reports with Commentary. Consistency, quality and consumer-friendliness are the qualities that make it easy for reporters to use regular monthly or quarterly reports. Well-written commentaries help journalists understand the news value of data and commentaries provide quotations that enhance readers’ understanding. Commentaries shouldn’t stop at a headline, but should identify several potential trends that could make news stories or blog posts for journalists who want to cover the “news behind the news.” Graphics?graphs, charts and tables as well as catchy infographics and cartoons?increase pick-up if they can be cut and pasted into stories and blogs.
Localized Releases. Multiply pick-up by breaking down data into markets and releasing either a table with the monthly reports or market-specific news release, which will harvest the most coverage because they provide local reporters more to work with.
Special Reports. By creating additional reports, you create additional opportunities for coverage. For example, if you are a listing site, create quarterly reports on subcategories: condos, REOs, luxury, resort, loan types, and more. Or if you are working with appraisal data, you might do a special report on distress sales nationally or in a region. Realtor.com identified Top Turnaround Towns based on its data and the list, released every quarter, generates extensive news coverage at the national and local levels.
Media Partnerships. As we’ve noted, news outlets love exclusive or first use of a news-making report. One of the secrets of launching a new report successfully is to pre-place it with a leading outlet. From these experiences, building a longer term relationship can reap even more results, with guaranteed top shelf coverage every time you issue a report.
Research Portal. Once you start releasing data to the media, you have to make it available on your site. Create a research portal where you can feature each news release and list the most recent chronologically. You should also archive reports, including graphs, tables, spread sheets and graphics. A portal will give your data longer shelf life in the news and it will become a new entry point for potential consumers.
Blog. Add a blog to your portal to create an additional forum to discuss your findings each month and generate additional audience interaction and news coverage from your analyses.
Executive elevation. A data communications program changes the way industry leaders and policy makers perceive your company and website. You become a source of important market intelligence, not just a provider of goods or services. This creates a new public relations platform for your company and its leaders, facilitating access to speaking engagements at prestigious forums, even Congressional testimony, and opportunities to address broader industry issues through op-ed articles and interviews.
Assessment. An assessment provides an initial read on whether a company’s data have potential to become a source of news coverage. It has two parts: a look externally at the news media opportunities based on an analysis of news interest and competing sources of data, and an internal review of the data to assess news value and quality. A positive assessment should include a discussion of next steps involved.
Confidential and Proprietary Data. Obviously you don’t want to release information that will help your competitors or harm your company. Also, your database may contain information that belongs to someone else, such as MLS listings. You want be sure that you have permission to use it. Often, problems with data confidentiality can be solved by creating and reporting an index that reflects market activity without releasing hard numbers.
Constructing Data Measures/Indexes. Once you identify a data series, you are ready to construct a data measure/index. This process involves the following steps:
- Data gathering (how do you efficiently collect the data?)
- Methodology (sample size; extrapolation, index construction, etc.)
- Statistical validation
- Build a historical Series
- Test the data (predictor capabilities)
The “democratization of data,” as RealtyTrac calls it, is made possible by the Internet but is made a reality only by enlightened companies who understand the benefits of sharing the information that passes through their portals. These benefits accrue to consumers, to real estate professionals and especially to the companies themselves.
In this white paper we’ve tried to share some of the lessons learned by those who are pioneering this new strategy in hopes that more real estate-related sites will take a look at mining the gold hidden deep in their servers.
About Reecon Advisors, LLC
Reecon Advisors is a real estate research and communications consulting firm for companies in residential real estate. Reecon Advisors publishes Real Estate Economy Watch, a award-winning web site providing information and commentary on the residential real estate economy.
David A. Lereah, president of Reecon Advisors, is a recognized economic expert in the real estate and financial services industries. Dr. Lereah and his research staff were responsible for creating two of the nation’s most powerful real estate indicators-the Mortgage Bankers Association’s Weekly Mortgage Application Indexes and the National Association of Realtor’s Pending Home Sales Index.
To provide insight and advice to professionals and companies involved in the real estate sector, Lereah founded Reecon Advisors, LLC in 2007. The company provides real estate content packages for company web sites throughout the nation. In addition, Dr. Lereah is available to conduct customized research projects and advisory consultation.
Steve Cook is Executive Vice President of Reecon Advisors and covers the real estate economy for the Real Estate Economy Watch. He also writes for Bigger Pockets, Equifax Personal Finance, Scotsman Guide, RE Technology and other online and print media. He has created and implemented communications programs using data from Realtor.com , and has publicized data reports from ForeclosureRadar and RBI, a subsidiary of MRIS.
For More Information, Contact:
Reecon Advisors, LLC
Real Estate Economy Watch.com