Introduction
The homebuilding industry has not normally been an early adopter of marketing technology and instead has relied on traditional marketing channels such as direct mail, radio and newspaper advertising, signage and realtor outreach. Recently, the homebuilding industry has become more aggressive in the adoption of mobile and social networking as a marketing channel. This paper will analyze the behavior of three homebuilders, Meritage Homes, Lennar and Shea Homes, who are in varying stages of adoption and deployment.
Background
Over the past several years, the focus on online, mobile and social networking has increased as homebuilders began to recognize the power of web-based marketing in reaching potential buyers. As a result of the economic downturn and resulting near-collapse of the housing industry, many homebuilders have shifted their attention to first-time homebuyers and products with lower price points. The majority of first-time homebuyers are between the ages of 30-39, with an average income between $30k and $75K.[1] This demographic is very similar to that of mobile device users and social networking site users.
Because the home buying process is complex, has a long buying cycle (normally 12-18 months) and is highly regulated, a home sale cannot be completed through the web. The focus of homebuilder websites is on providing information that is critical to the buying process: product, price, location and contact information with the “lead conversion” occurring when a potential buyer visits a physical sales office.
There are two separate audiences for a homebuilder’s products and services: buyers and Realtors. Each of these audiences has similar information needs but different viewpoints. Realtors have been aggressive in adopting technology such as mobile devices and smart phones and are extremely active on social networking sites such as Facebook, Linked In and Twitter. The National Association of Realtors Facebook page has 62,016 Likes.[2] Realtors actively use Facebook to build and maintain their network of clients and prospects.
In addition to the homebuilders’ proprietary mobile websites, there are numerous content aggregators who consolidate, re-package and brand the basic content and provide add-on tools and services. The resulting mobile site is a rich-media, highly interactive user experience that fully leverages the capability of the device including: iPhone, iPad, iPod, Android, Blackberry and Palm. The primary players include: Zillow, Trulia, Realtor.com, Smarter Agent, New Home Source and Move.com. These content aggregators have been very aggressive in developing mobile solutions. Smarter Agent has patented the use of geo-location technology through GPS and other methods when it is used to provide information about a real estate listing by mobile devices and is vigorously protecting its patent rights with other content aggregators. [3]
Example sites


Industry Trends
- Outbound SMS messages – Messages sent to selected opt-in groups to deliver time-sensitive offers and promotions is increasing in popularity. KB Homes recently announced a program for Realtors.
- Smart phone apps – Most homebuilders lack the technical infrastructure necessary to develop and maintain mobile websi
tes and apps and rely instead on external resources. Low-cost, commodity solutions are easy to adopt and have reduced the barriers to entry, but do not create a competitive advantage.
- Social networking – Homebuilders are increasing their presence on sites like Facebook. Advertising on these sites is increasing.
Three Homebuilders; Three Approaches
The following section examines the use of mobile and social networking as marketing channels by three homebuilders: Meritage Homes, Lennar and Shea Homes. Each of these homebuilders has taken a different approach to the marketing channel and the underlying technology. We will focus on four areas of functionality being utilized: mobile web, mobile advertising, text messaging and social networking. Based on how each homebuilder is using the functionality and the underlying technology, we have characterized each as an Early Adopter, Mainstream or Trailing Edge.
Meritage Homes
Meritage Homes is the 9th largest public homebuilder in the US[4] with divisions located primarily in the South, Southwest and West. In general, Meritage is Mainstream in its adoption of mobile and Trailing Edge in social networking.
- Mobile web – Meritage has a mobile website that was developed by Advanced Mobile Solutions. This developer created mobile websites for numerous homebuilders through an offering by Builder Digital Exchange (BDX). Although functional, there is no branding. Code on the main website recognizes an incoming mobile device and redirects to a mobile version. The list of recognized devices is maintained manually. There is one version for all mobile devices. The site provides product images, pricing, location and a Click to Call function. There is no geo-location capability. After determining that a compiled application (app) would require extensive development and ongoing support, Meritage decided to develop two versions of the mobile site, each of which would deliver the optimum experience to the Smartphone user. The BASIC SMARTPHONE version – Mobile phone with access to the internet and a web browser that supports XHTML 1.0, but does not support HTML5, CSS3, and JavaScript. Does not support flash. An ADVANCED SMARTPHONE version- Mobile phone with access to the internet and a web browser that supports HTML 5, CSS3, and JavaScript. Does not support flash.
- Mobile advertising – Meritage is not active in mobile advertising but has the capability to place ads on content aggregator sites and other sites within the real estate content network.
- Text messaging – Meritage has previously tried using short-code SMS messages tied to inventory homes. This program had limited success and was terminated in favor of the Click to Call feature of the mobile website. Meritage is currently evaluating the use of outbound broadcast text messaging (SMS) to a group of opted-in contacts (i.e., Realtors). Meritage recently changed their online registration form to allow prospects and Realtors to choose Text messaging as the preferred communication channel.
- Social networking – Meritage has recently become active in social networking with several Facebook pages, an active Twitter account and has integrated social networks with other marketing channels. Although not currently advertising on Facebook, there are plans to launch several campaigns to promote webinars, grand openings and other events at a local level.
Lennar
Lennar is the 3rd largest public homebuilder in the US[5]. Based in Miami, Lennar builds in numerous locations across the US. Lennar is solidly Mainstream in their adoption of mobile technology and was an Early Adopter in the area of Social Networking.
- Mobile web – Lennar has a branded website that delivers a consistent interface but does not provide an enhanced experience or capabilities for smart phone users. Click to Call is offered. Code on the main website recognizes an incoming mobile device and redirects to a mobile version. The list of recognized devices is maintained manually. There is one version for all mobile devices.
- Mobile advertising – Lennar is not actively doing any mobile advertising.
- Text messaging – Lennar is not actively collecting mobile phone numbers and does not list mobile phone or text message as a preferred way to contact prospects.
- Social networking – Lennar is very active in Social networking. Facebook contests are used to obtain registrations which then fuel marketing efforts. On average, visits to Lennar.com from social networking sites are 4.7% of total visits[6], one of the highest of the large builders. No advertising has been noted.
Shea Homes
Shea Homes ranks 20th on the 2009 Builder 100.[7] Shea is privately owned and builds in the South, Southwest and West. Shea is an Early Adopter of mobile and social networking.
- Mobile – Shea was the first major homebuilder to launch an iPhone and iPad application. The app is delivers a first-rate user experience and fully leverages the capabilities of the iPhone including geo-location through GPS, map zoom, ability to expand images, and other standard 3G and 4G features. They are required to update the app on a regular basis, which they do through the iPhone App Store.
- Mobile advertising – Shea is not actively doing any mobile advertising.
- Text messaging - Shea is not actively collecting mobile phone numbers and does not list mobile phone or text message as a preferred way to contact prospects.
- Social networking – Shea has been very active in Social networking, especially through Shea Spaces, the product line targeted at first-time home buyers.

Conclusion
Homebuilders are not normally on the leading edge of new technology adoption. They have been slow to adopt mobile technology and social networking, although there are a few early adopters. There is a convergence of the target market with mobile device and social networks that cannot be ignored. This represents a unique opportunity to connect with and cultivate long-term relationships with potential buyers and Realtors.
There are several areas where the homebuilding industry could benefit from expertise and thought leadership in marketing through mobile and social networking channels.
- Geo-Targeted advertising – The best way to connect with prospects and realtors is when they are in close-proximity to homebuilders’ communities. Offering special promotions, discounts or invitations to events while a prospect is nearby would greatly increase the likelihood of a community visit.
- Mobile marketing – This is an area where homebuilders are not well versed and there are few “packaged” offerings from content aggregators. As mobile devices increase in popularity, there should be an increased focus in this area.
- Social network advertising – Few are using it and it is a great opportunity to connect with the right demographic.
[1] Century 21,
First Time Home Buyer and Seller Survey, (
http://www.century21.com/buyingadvice/buying101/pdf/profile-of-a-first-time-homebuyer-checklist2.pdf), 2010, April 21.
[2] Facebook, National Association of Realtors, (http://www.facebook.com/pages/National-Association-of-REALTORSR/31367825182).
[3] Techflash.com, Zillow, other real estate firms hit with patent infringement suit, (http://www.techflash.com/seattle/2010/04/zillow_others_slapped_with_patent_infringement_suit.html), April 9, 2010
[4] Builder Online, 2009 Builder 100, (http://www.builderonline.com/builder100/2009.aspx), 2010
[5] Builder Online, 2009 Builder 100, (http://www.builderonline.com/builder100/2009.aspx), 2010
[6] Hitwise Key Traffic Driver Report, September, 2010
[7]Builder Online, 2009 Builder 100, (http://www.builderonline.com/builder100/2009.aspx), 2010