CoStar To Spend A Billion {Dollars} On Advertising In Battle For Portal Crown
Mark your calendars for the final word actual property experiences with Inman’s upcoming occasions! Dive into the long run at Join Miami, immerse in luxurious at Luxurious Join, and converge with business leaders at Inman Join Las Vegas. Uncover extra and be a part of the business’s greatest at inman.com/events.
Amid a relentless battle for the real estate portal crown, CoStar this week is launching a advertising and marketing blitzkrieg that can embrace Tremendous Bowl adverts, movie star endorsements and an unprecedented conflict chest meant to catapult the Properties.com model into mainly each American family.
CoStar CEO Andy Florance publicly offered particulars on the marketing campaign for the primary time in a name with Inman Thursday afternoon. Florance mentioned his firm will run 4 totally different commercials throughout the Tremendous Bowl on Sunday. One of many commercials will deal with CoStar’s Residences.com rental portal, whereas the opposite three will deal with Properties.com. Actors Jeff Goldblum, Dan Levy and Heidi Gardner, amongst different celebrities, will seem within the adverts.
CoStar will then proceed to run commercials all year long, together with throughout main cultural occasions such because the Oscars and NBA playoffs. Florance mentioned the marketing campaign can be 4 occasions the dimensions of the blitz it ran in recent times for Residences.com, which noticed Goldblum’s Brad Bellflower character become a ubiquitous feature on streaming platforms and different media. He added that the trouble would be the “largest advertising and marketing marketing campaign ever run by any actual property group in all the world.”
“It’s orders of magnitude greater than we did for Residences.com and bigger than something anybody has ever finished earlier than, by far,” Florance added.
Florance mentioned CoStar just isn’t disclosing the precise quantity it’s spending this 12 months on the brand new marketing campaign, however famous that it “rounds as much as a billion.” He added that when factoring in acquisition prices, content material creation, search engine marketing and different types of smooth advertising and marketing, the corporate has spent “a number of billions” bringing Properties.com to the market during the last a number of years. And he mentioned the corporate is doing all of this as a result of it believes within the product it has constructed.
“We’re assured now we have the very best website now by far,” Florance instructed Inman. “We’re assured now we have an agent-friendly mannequin.”
CoStar has additionally been engaged in a heated rivalry with Zillow for the final a number of years. Requested Thursday if he believes CoStar’s residential enterprise can surpass Zillow, Florance replied within the affirmative.
“That’s completely the aim,” Florance mentioned, “and I imagine we’ll cross them.”
Florance didn’t say particularly when he thinks that may occur, however mentioned CoStar is within the residential house for the lengthy haul.
“You do it by working away at it,” he added of claiming the primary spot.
Florance’s feedback come simply days after CoStar quietly posted a video laying out the corporate’s advertising and marketing technique for Properties.com. The video — which as of Thursday morning was not publicly listed and required a direct hyperlink to see — targets actual property brokers and states that the corporate has invested $1 billion to “drive 80 billion impressions” and attain “greater than 90 p.c of households.”
The video additionally echoed Florance’s feedback, describing CoStar’s Properties.com promoting efforts because the “largest advertising and marketing marketing campaign in actual property historical past.”
The agent-oriented video went stay simply days after CoStar posted several consumer-focused ads to YouTube that featured Levy and Gardner, in addition to rapper Lil Wayne. These provides promised “a robust new home-shopping platform,” and ended with the date of this upcoming Sunday — which can be when the Tremendous Bowl is being held. Florance had beforehand teased the movie star facet of the marketing campaign from the stage at Inman Join New York in late January.
Those self same celebrities additionally seem within the video for brokers. Goldblum has a blink-and-you’ll-miss-it cameo.
Amongst different issues, the agent video explains that CoStar plans to run Properties.com adverts on streaming platforms, broadcast TV, and digital radio, in addition to throughout main occasions. The video guarantees brokers the outcomes can be “electrifying,” and at one level the digital camera cuts to Levy, who states that “this can be a gold mine of native intel.”
“No different competitor comes near our funding to drive results in all brokers,” the video states.
Greg Robertson first noticed the video.
CoStar’s pitch to brokers is a serious a part of its new advertising and marketing marketing campaign. Whereas talking with Inman Thursday, Florance touted the corporate’s “your itemizing, your lead” technique and mentioned that Properties.com will put each brokers identify and firm on their listings. He contrasted that with different portals, which “strip off” dealer data once they ingest listings from MLSs. Florance criticized Zillow’s provide so as to add further data and branding for a charge.
“That’s a shakedown, an inventory shakedown,” he mentioned.
In contrast, Properties.com will embrace dealer branding totally free. Florance mentioned that Properties.com’s 80 billion impressions this 12 months ought to then translate to “100 billion impressions of brokers’ logos.”
“It’s actually a advertising and marketing marketing campaign for each single agent and each single dealer in the USA,” Florance went on to say of CoStar’s present efforts. “And nobody else could make that assertion. ‘Your itemizing, your lead’ signifies that when Compass has an inventory, when Jane Smith has an inventory, individuals will see that Compass brand on our website, they’ll see Jane Smith’s identify on our website.”
Throughout his name, Florance additionally touted Properties.com’s options, saying CoStar has constructed profiles of 21,000 U.S. neighborhoods. Customers can use the profiles to study every little thing from faculties to eating places to nightlife within the areas the place they’re house buying. The neighborhood profiles additionally embrace drone footage, with Florance noting that CoStar did 375,000 drone flights in 2023.
“We now have the biggest drone fleet in America apart from the navy probably,” Florance mentioned.
The brand new marketing campaign to attract atttention to Properties.com is a part of an aggressive, multi-year push into the world of residential actual property. Lengthy a dominant participant within the industrial house, CoStar started making a play for residential shoppers because it acquired manufacturers equivalent to Homesnap and Homes.com, in 2020 and 2021 respectively.
Properties.com has now grow to be CoStar’s flagship consumer-facing residential model.
Florance has additionally been open in his critiques of rival portals, suggesting for instance that Zillow — the highest shopper portal within the U.S. — “hijacks” listings and “blackmails” agents. Throughout Inman Join New York final month, Florance reiterated his criticism of rival portals, this time throwing Redfin and Realtor.com into the combo as effectively.
Current information shows that Zillow remains far and away the biggest portal within the U.S.
Nevertheless, CoStar’s huge dimension — in addition to its obvious ambition — made it a formidable competitor even earlier than this newest advertising and marketing push. In December, analyst Mike DelPrete noted that CoStar had managed to develop Properties.com considerably and shortly through a steadily rising promoting funds. In 2022, that meant CoStar outspent Zillow by an element of two. In 2023, CoStar was on monitor to beat the rival portal’s spending by 3.5 occasions. DelPrete additionally famous that CoStar is extra worthwhile than every other main portal maker, and has more money.
“Competitors between portals is a marathon,” DelPrete argued as 2023 got here to a detailed, “and money within the financial institution just isn’t solely a requirement to play the sport, however a crucial prerequisite for fulfillment.”
Replace: This story was up to date after publication with further commentary from Andy Florance’s name with Inman.
