Joseph Ferrara at sellsius&176; blog asks once and then again and then a third time here: How much does The Long Tail
Chris Anderson, the author of the book, has some answers, but they vary from industry to industry. But from my own point of view in real estate, The Long Tail is a very promising source of choice opportunities. If you can conceive of an under-served niche market where the product is avidly sought, even if only by a small minority of the buyer population, you have a business. This much is not news. We’ve had luxury home and vacation home and historic home specialists forever. The difference is Google, which is surely The Lord Of The Long Tail.
Consider this as an example:
I wrote my web page on No Dual Agency on June 28, 2006. I linked to it internally within our own site, but the page had no in-bound links, nor did I pursue any. On July 7, I ran this search, jut to make sure I hadn’t overlooked anything. My page had Googled up from nowhere to first place in nine days on the strength of content alone, with zero in-bound links.
But wait. There’s more. I first mentioned our No Dual Agency policy in BloodhoundBlog on June 29, but the first time I weblogged it as its own topic was on July 14 — Bastille Day.
On July 17, Jim Duncan of Real Central VA wrote a post called Dual Agency — Who benefits?, linking back to me. I saw the trackback and commented on his weblog.
Guess what happened?
Take another look at that Google search. Jim’s post is in second place. In three days — two days, really; I saw it yesterday.
This is truly a Long Tail keyword. In quotes, “no dual agency” yields 290 hits total. And it is probably vain to expect home buyers or sellers to sit down at the computer and type “no dual agency” into the Google box. But the basic point stands: First and second place are held — for now — by two web sites that weren’t even in the game on June 27.
Presumably a Long Tail real estate search is going to be a tougher nut to crack, but webloggers have an advantage over their competitors. Google honors organic content, and there is no substitute for good content. But Google weights in-bound links from weblogs more heavily then in-bound links from ordinary web pages. And it spiders weblogs with alacrity. So if you can produce good content about a niche product, blog about it. If another blogger picks up on your ideas and runs with them, you could race to to the top of that keyword search in no time.
How girthsome is The Long Tail? No — how lithe!
Technorati Tags: real estate, real estate marketing
jf.sellsius says:
Yes, long tail theory applied to keyword and page ranking is an interesting phenomenon. Writing on little searched keywords is equivalent to Amazon’s sale of obscure book titles. But my question is concerned with how weighty those obscure keywords are in the overall market, eg. the most commonly searched real estate keywords. In other words, if “no dual agency” and all the other long tail keywords and phrases are added together—how much of the actual real estate keyword market are you reaching. My hypothesis is that based on Pareto’s principle, the long tail will give you only 20% of the market. While in pure dollars, or eyeballs, this is great, in the big picture, it lags well behind the head & body.
With that said, I support the notion of the long tail as a means of exploiting or taking advantage of niches. If dual agency is you niche, then the long tail will help you if you focus on it. But Amazon used the long tail not to pick ONE niche and exploit it but to get ALL the niche titles and cover the entire long tail—
July 20, 2006 — 12:49 pm
Greg Swann says:
Anderson’s research hovers around 80/20 — say 65/20 to 95/20. The Short Head still accounts for most sales.
This is a correct analysis if the marginal cost of each added increment of wealth-production is at or near zero. Nearly true for Amazon, and essentially true for the business you are launching. Yours will be a classic Long Tail distribution, with a very compressed Short Head and a nearly-endless Long Tail.
Consider my practice, though. Working alone, I can sell perhaps 4 houses a month, either as the lister or the buyer’s agent. Too many eggs to juggle. If I did more houses than that without help, I would make mistakes, the root of all real estate lawsuits. The Short Head is where all the inventory is, but it’s also where a lot of the competition is. I could easily sell 48 Short Head houses a year at around $250,000 each. But for the same marketing effort, I could sell 48 $500,000 houses from a Long Tail niche. If I’m right about what I’m doing, I could sell 48 million-dollar-plus houses. The consequences of failure on my part rise, but my competition diminishes drastically. Even if my cost-per-conversion holds steady or even rises, my net-profit-per-conversion soars.
On the other hand, if I look at the problem like a more traditional broker, then I’m back to the full distribution, looking for agents to service every type of product from Short Head to Long Tail. The inventory concern, then, is not my time, but the time of my agents, which costs me nothing.
As an individual practitioner, my interest is best served by specializing in a lucrative niche. There is less competition, and my marginal cost per-profitable-dollar is much lower.
As a broker — and ignoring liability and errors and omissions issues — my interest is best served by having as many agents as possible. My yield per conversion is much lower, but all the added costs are socialized to the agent (which is the point of the broker/salesperson business model).
We don’t do this, because we are in a longer-term competition for reputation, but that is the way a giant brokerage confronts the marketplace, Short Head, Long Tail, everything under one roof.
July 20, 2006 — 1:52 pm
jf.sellsius says:
Excellent comment which I agree with wholeheartedly. Getting and mastering a lucrative niche is a broker’s best use of a long standing marketing strategy predating long tail analysis. As you point out, a franchise like Re/Max who wants a brokerage network to cover every category of real estate would be taking advantage of long tail economics.
And yes, you are correct in regard to our business model. Sellsius will be taking the long tail approach with the launch of our all-inclusive, low cost, real estate website.
July 21, 2006 — 9:07 am
Fred Carver says:
I recently posted this on Brian Brady’s Blog about Ashley Dupree and thought it may apply here, let me know if you have a forumla to have everything I do come up first like Amazon, here part of my post with Brian….”I did a simple long tail keyword heading in a post..an address on a new listing, it went like this 306-949 Cloverdale Ave Top floor condo Victoria BC. As expected the blog was in Google at the top of the page for the address search…great I could tell people to Google the address. I was playing around the next day and did a search..top floor two bedoom condo victoria…there I was at the top of the search page on Google. Now that search has potential wih Buyers looking for a top floor two bedroom condo in Victoria. Now I just need to have all my blog posts come up on the top of all my long tail key word searches…Well all the ones I’ve done so far are going there. Try Victoria BC luxury and waterfront realtor.
I Mean the only Realtor for my Area…only in my dreams!
Great stuff, you’re right in 2004 I sure would not of thought of this, for that matter two months ago I was not there!’
Cheers
March 15, 2008 — 9:30 pm