High gas prices and online marketing…a correlation?
June 6, 2008
With the high gas prices lately, it has caused me to do some thinking…
If energy prices continue to rise (and I think that they will…), then what impact does this have if any on online marketing? What follows are just my random thoughts on the subject.
I think that how energy prices impact marketing is an industry specific thing. If you are talking about the grocery industry, I do not think that high gas prices change much of anything. People are still going to go to the store and do their shopping. And I would think that even in industries where there is significant online marketing growth already, separating out which part of the increase has come from high gas prices and which has come from other factors is a difficult proposition at best.
There are a few industries where I think significant impact will be made. Industries where the actual buying process includes road time are likely to be most impacted. The obvious example of this is real estate, Home buyers often drive around neighborhoods looking at houses, sometimes long before they are ready to buy. I think this will slow as the price of gas increases.
Along those same lines, I think this change is aided because there is an alternative shopping style immediately available online that is widely used. MANY buyers browse online, do their research and THEN go drive around. I think the increased gas prices only add to that, causing many of the remaining ‘browsers’ to become ‘online browsers’.
OTHER IMPACTS TO THE REAL ESTATE INDUSTRY
Another huge impact in the real estate industry will be the demand level for ‘close in’ homes as opposed to the ‘burbs. We are already seeing that in Louisville, with new home developments in outlying areas have more difficulty in moving homes and having to offer discounts to entice buyers. It used to be location. location. location. now it is, proximity. proximity. proximity. People seem to be much less willing to drive the long commutes to get to work, rendering the outlying areas of a metro city insome cases with a valuation problem.
REALTORs from around the country are starting to discuss it online as well…I will add their posts as I find them:
Jim Olenbush mentioned it in his Austin real estate blog. I am sure more are going to be following suit as they see this correlation play out.
EDIT: There are now other posts appearing on the web regarding gas prices affecting the real estate market in Chicago, Columbus Georgia, another one in Austin Texas . JUST ADDED: One in Las Vegas as well!
If you know of more, equally relevant posts out there, please point them out to me and I will be happy to add them. I know my REALTOR friend Holly While in Nashville TN may well be writing one soon as well.
The people that figure out alternative means (read: better returns on investment (ROI)) of getting their job done, will be able to thrive. Those that rely on doing what they always have done, without trying to streamline will most likely have a harder time of it.
[...] 3rd) The way potential home buyers shop for homes may shift as clients may spend less time just riding around looking for homes and more time online searching. This will make a more powerful way to search for homes online even more important to the home buying consumer. I noticed this was pointed out recently by a search engine consultant. [...]
[...] Louisville Gas Prices Share and Enjoy: These icons link to social bookmarking sites where readers can share and discover new web pages. [...]
Gas prices are effecting every industry that provides a product or service. I think we’re going to see some major shifts in the ways things are in the coming years.
[...] Stories from around the country: High gas prices and online marketing…a correlation? Gas Prices and the Housing Market (Austin Texas Blog) JR would have sure been proud! (Columbus GA [...]
Eric, We’re seeing Potential clients sit on the fence..waiting until the gas price crisis levels off. My wife Norine and I have traded in a gas guzzler for a hybrid SUV for our real estate team. Unfortunately that hybrid is underperforming. The gas millage is not what was advertised. I’m told to wait until we get 10,000 miles on it before forming a final opinion! Oh Man!
I guess that higher gas prices will lead for many people in suburbs to rather shop online. I hope so