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Friday, January 18, 2013

Using Predictive Analytics to boost your Real Estate Business

How is your real estate market trending?

If it’s like many we monitor, it’s booming early in 2013.

That’s a great thing, but as we’ve recently mentioned, it’s also one you absolutely have to measure.

What good is a marketing budget if you’re unable to forecast when your peak periods will occur, when you should begin marketing to take advantage of them, and when you should premeditatedly begin more aggressively targeting specific markets, price ranges and other demographics?

The answers lie within the two “Holy Grails” of digital data: Predictive Analytics and Multi-Channel Attribution Modeling.

The latter deals with understanding that today’s consumer might visit your website and submit a lead through a specific referral, but there are many points of contact they’ll have with your marketing channels in the meantime that could be largely responsible for ultimately bringing your company that sale.

The former, which we’ll discuss in this article, deals with measuring pre-trend factors to better understand and forecast what’s going to occur, even if it hasn’t taken shape yet.

If you’re not a numbers or analytical person your head is probably spinning already. But don’t allow that to be the case, because we’re here to help.

Predictive Analytics allow you to forecast based on what should happen in an industry during specific times. In real estate, it can be a measure what’s happening before the sales data actually shows it occurred. Existing-home sales data is often reported by the national media based on closings. But we all know that trend may have ended before the local newspaper can print the data.

There’s a lot that occurs before a closing is finalized. The customer typically will do research, find a few houses they like, ask more questions about them, schedule showings for them, make an offer…you get the idea.

All of those steps provide better trends toward what’s occurring in the real estate industry than do closings. But all of them would have to be measured to provide data to predict market trends.

For example, your fellow real estate agent might have three clients that were in a holding pattern, but recently requested showings. You might have five that had recently looked at houses but now are in a holding pattern. Neither stat can predict industry trends for your brokerage, let alone regional, state, or national real estate trends.

The two purest ways to use predictive analytics in real estate are to measure:
1. When people begin searching with more frequency for real estate.
2. When people begin inquiring more about real estate with intention to buy or sell.

Due to the rollercoaster market and economy over the past half-decade, those trends can’t be forecast too accurately too far in advance. But they can be analyzed when using the right systems that measure local real estate market data.

The right system would have to show market trends as soon as they’re occurring, and allow one to see how those compare with previous months and years. It would break down the types of leads that are incoming, so trends can be accurately analyzed. And it would be based by region and brokerage, so as not to let another market's stats skew those of your own.

Digital analytics can get a bit complicated, even for the most tech savvy Internet marketer. So that system should be paired with Google Analytics data, local market real estate pricing and sales trends, and—perhaps most importantly—packaged from a company that can help you correctly utilize the data to your advantage. That company should provide the advice and tools necessary to better leverage your digital marketing assets to make the most of those trends.

Predictive analytics and other digital marketing measures might sound scary, but they can be one of your best allies in this new age of Internet, Email, Social Media and Mobile marketing.

And Delta Media Group can be your best ally in digital marketing. Contact us for more details.
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