Estate Agents Stick With Local Newspapers For Time Being !!

Date Published 29 October 2012

Agents are not ready to ditch local paper advertising – yet.

It is no secret that UK local newspapers are haemorrhaging circulation and are among the worst performers in Europe: only 18% of the population read a local daily compared with 53% in Germany, 21% in France and nearly 70% in Norway and Switzerland.

Local papers are also losing money. When new Mirror boss Simon Fox wrote to his staff this month, he said: `What we are experiencing are continued circulation declines and even faster reductions in advertising revenues.`

Johnston Press reported a fall in ad revenue of over 8% in the first half of this year, and Newsquest reported advertising revenue down 5% in the second quarter. Specifically, it said property advertising was down 8.1%.

At the weekend, it emerged that the Daily Mail is trying to sell its ailing regional titles for £110m, having turned down an offer of £1.2bn six years ago.

Sequence chief executive David Plumtree said there have been `gradual reductions in local press spend` over the last four or five years, with vendor expectations on local advertising dwindling.

He said: `We see greater returns on investment in online expenditure, so prefer to deploy marketing and advertising spend online rather than in print.`

But Waterfords, an independent chain in Surrey, Berkshire and Hampshire, is doing three times the amount of advertising in local press than last year.

Managing director Brendan Cox said that this is partly because it is cheaper than leafleting, and partly because of the firm’s new homes business.

He said: `Above nine years ago, local papers were negotiating advertising rates individually with agents, meaning some were paying ridiculous prices.

`At this time, I played an instrumental role in setting up an estate agents association in our area in order to control the power the papers had over agents. Now we all pay exactly the same. The rates are pretty competitive and we have an agreement that these are fixed for the next two years.`

He said local newspaper advertising is cost-effective at £200 per page in a paper distributed to 70,000 homes per week. `If you compare that to a 70,000 print leaflet drop, the delivery of this alone, excluding production costs, would be approximately £3,000.

`I remain an advocate of local advertising and my view is that there is still very much a place for it.`

Spicerhaart says it intends to continue local press advertising `for the foreseeable future`, but is spending more on digital marketing, including YouTube. A spokesman said: `As a group, we are spending more on marketing than ever before and that spend is being spread across more platforms than ever before… [but] the market is changing and you have to change with it.`

Townends, in Greater London and the home counties, says its 2012 newspaper spend will be the same as last year and it expects next year to be similar. However, it now uses advertising as a brand awareness exercise, rather than for advertising properties in standard nine-box property pages.

Beresfords, in East Anglia, is still advertising in local papers and believes strongly in the ‘traditional approach’, while investing heavily in an internet presence.

`We believe a profile across a wide media spectrum is the answer,` said director Terry Holmes. He added: `These days, local newspapers are probably more important in attracting sellers rather than buyers, but those sellers provide our stock. And you can’t sell what you don’t have!`

Harrison Murray in the midlands is also still using local newspapers, with no plans to give it up. Managing director Nick Salmon said: `The days when the phone rang off the hook on the day the ad came out are long gone, but newspaper advertising still has relevance for the maintenance of our brand and remains an important part of a much wider marketing mix. At the same time we are increasing our investment in technology and online marketing.`

Estate agency consultant Mike Day said: `I haven’t got a single client who has withdrawn from local press advertising entirely, but I do have several who are being more selective.

`Many clients now only budget for around 44 weeks of offline advertising a year and so withdraw completely or reduce paginations during holiday months such as August and during December.

`Nearly all clients are now using social media with varying degrees of success. Those who generate interesting content and drive traffic to their own websites, and engage with people etc are seeing genuine returns. Those who insist on tweeting or facebooking every instruction they list just still haven’t got it.

`Online spend has become more expensive as Rightmove, in particular, has raised charges alongside trying to offer some ‘differentiation’ for agents within its pages. After all, saying you are on Rightmove is now a given not a USP.

`Zoopla is looking to gain market share and, in many cases, I have clients paying next to nothing for presence on these sites. This situation will have to change and agents who are presently scatter-gunning by being everywhere will be faced with making choices between offline and online and where online.

`Offline still has a place as it is invariably very localised and can attract sellers and landlords if not buyers and tenants. Of course, many local papers have died and so the choices are becoming more limited and some are no longer worth advertising with as their circulations and distribution are poor. Many also feature syndicated copy across many papers and so are becoming less of a local benefit.

`Most agents are creatures of habit and have a herd mentality and live their lives scared of doing anything different to the agent next door, when it is the points of differentiation that set the top agents apart from the rest.`

He added: `Advertising spend has been moving online and away from offline for the last ten years plus, but talk of its demise are premature. Property has usually been a loss leader for the local press who make their money on recruitment and motors.

`All of these sectors are moving online and so, whilst the local paper may not be dead, it looks terminally ill.`