Trulia.com is a web powerhouse. The digital marketing intelligence firm Experian Hitwise ranks Trulia as the third most visited real estate website in the U.S., and Compete estimates Trulia’s monthly unique visitor count at a whopping 7 – 8 million. Trulia certainly knows what it’s doing online. And Digital Marketing NOW was fortunate enough to catch up with Trulia’s Chief Economist and Head of Analytics, Jed Kolko, for his insights into web analytics, the U.S. economy, and more!
DMN: How does Trulia ensure that it leverages the insights uncovered from your analytics data?
Jed Kolko: First of all, we’ve got the right people building and analyzing our data. With backgrounds in data science, operations research, economics, and business, we deploy a range of tools and approaches to analyzing our data.
On top of that, our data and analytics teams work very closely with all other parts of the company – like product management, business services, and marketing. That keeps our teams focused on data and analysis that will help us delight our customers, improve business results, and give the broader public meaningful, relevant insights about the housing market and the process for buying, renting, or selling a home. Whatever data we look at, whatever analytical tools we use, and whichever audience we’re trying to reach, we have a clear sense of the purpose and how the results will ultimately be put to use.
DMN: What’s the single biggest mistake that you believe businesses make with their analytics implementation or usage?
Jed Kolko: One common mistake is that the “client” of an analytics project sometimes isn’t prepared to act on the results. This can happen either when the client is internal, like a product group working with an in-house analytics team, or when the client is external, like when a company hires a research or analytics vendor.
Action requires broad buy-in. For instance, an analytics team or research vendor might conduct a customer segmentation for a client, but that segmentation will have little business impact unless the client uses the segmentation in its product development, sales process, marketing strategy, and so on. The client group or company that wants analytics insights needs to ask itself tough questions about whether its business processes and culture are open to implementing the results – and an analytics team or research vendor has the responsibility to lead the client through the process of asking and answering these tough questions.
DMN: What’s your forecast for the US economy and the housing market in 2012-2013?
Jed Kolko: This will be the year of the disconnect in the housing market. The real estate industry will be increasingly upbeat, as construction – especially multi-family — picks up from its very low levels the last several years. Builders will probably have a better year in 2012 than they have since the bubble. Real estate agents, too, should see more business, as low prices and a stronger economy lift housing demand and spur more sales.
However, consumers will continue to have low confidence in the housing recovery – and that’s where the disconnect comes in. Although the industry will be optimistic, consumers stay pessimistic. That’s because prices are still slipping, thanks to the large number of vacancies. More importantly, we should see a new wave of foreclosures this year as banks resume some of the foreclosures they put on hold as they were being criticized for “robo-signing.” Foreclosures really shake consumer confidence. This coming wave of foreclosures will help keep prices down and scare some consumers away from the market.
DMN: What will be the major economic forces at play in the coming year?
Jed Kolko: Jobs, as always. The more jobs we have, and the higher incomes go, the better people are able to spend more on housing, become homeowners, or stay in their homes. U.S. employment has grown in each of the last 16 months, and the unemployment rate is falling, and that’s good news for the housing market. Credit matters, too: we’ve swung from easy credit during the housing bubble to tighter credit in the bust, so even though mortgage rates are very low, many people don’t qualify for a mortgage or a refinancing. Finally, policy and politics will be in play this year. The Obama administration has proposed several housing policies recently, like making it easier to refinance, to get a loan modification, and to buy or rent government-owned homes. Some of these ideas are expansions of existing policies that have helped fewer people than expected, so the effects may be modest. And, it’s hard to get anything done in an election year because politicians don’t like to give their political opponents victories before going to the voters. We’ll hear a lot of talk about housing policy, but much of that talk won’t turn into action.
For more insights on what’s in store for 2012, check out Kolko’s post “Trulia’s Real Estate Crystal Ball for 2012” on the Trulia blog.