CoStar Group is making good on its promise to ramp up its bet on Homes.com — and reporting some returns.
Traffic to the residential platform grew six-fold last quarter, with average monthly unique visitors nearly doubling from the same period in 2022, company executives said in a recent earnings call.
The timing was good for the firm to take a small victory lap: its $1 billion advertising campaign kicked off just over a week earlier with four commercials aired during the Super Bowl.
The spots, which made up the first installment of what chief financial officer Scott Wheeler billed “the biggest marketing campaign in real estate history,” were followed by a week of ads across TV and audio and video streaming platforms. The firm also began selling memberships to Homes.com, executives said in the earnings call, a move previously slated for next quarter.
The firm is continuing its pursuit of impressions with commercials planned for major entertainment award shows and sporting events throughout the year, including March Madness and the Olympics, comparing the push to that of Apartments.com, which it purchased in 2014 for $585 million.
“As we did with Apartments.com, our plan is to grow unaided awareness from the low single digits to more than 50 percent,” CEO Andrew Florance said in the earnings call, deeming the larger platform the “single largest business in CoStar Group.”
Homes.com stands a chance to catch up to its predecessor, with an advertising blitz is four times that of CoStar’s first campaign for Apartments.com
“We believe that no other competitor is investing close to what we’re investing in this effort,” Florance said. “We believe we can grow share.”
Residential push hits home
The company signaled last year it was looking to ramp up its investment in cracking residential. News of CoStar’s discussions to buy Move, Inc. from NewsCorp set up what could be the first substantial challenger to Zillow’s stronghold on the sector, but the abandoned deal turned the spotlight on its existing products.
Homes.com had emerged as a clear favorite since the firm paid $156 million in cash for it in 2021, but its status was cemented after the firm said in June it was phasing out its Homesnap search product to go all in on Homes.com.
Homes.com and Apartments.com last year surpassed Redfin and Realtor.com to become one of the most-visited platforms, second only to Zillow.
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Despite the gains, CoStar’s residential platform is still trailing Zillow, which reported three times the internet searches and daily active app users of its nearest competitors last year, according to the company’s shareholder presentation.The term “Zillow” was also searched more than “real estate.
“While we have excellent traffic numbers, we do not yet have the unaided awareness we need to sustain the top traffic position and to draw the volume of advertisers we seek,” Florence said during the earnings call.