Digital marketing - Did Malaysian Property Developers seize the opportunities?

Case Notes 05:  This article is about using website performance as a proxy in assessing the extent to which Malaysian property developers have embraced digital marketing. 

Many Malaysian property developers have turned to digital marketing because of Covid-19.

“Digital marketing is the use of the internet, mobile devices, social media, search engines to reach consumers.” Investopedia

The centrepiece of all digital marketing activities is the company’s website. 

“Your website is the key to a successful digital marketing strategy because all other digital marketing elements direct guests to your website." Digital Marketing Skill Institute

There are many ways to assess how far companies have embraced digital marketing.  Given its central role, the first step is to look at companies’ website performance.  

One way to assess this is to compare the website domain score and organic traffic. 

As an investor, you want to know how far Bursa property companies have adopted digital marketing. Those who have incorporated this into their marketing strategy may be better off in the immediate Covid-19 future.

An analysis of their website performance provides an insight into this. 

The results of such an analysis are not very encouraging. 

  • Malaysian property developers are far behind those in the USA, UK and, Singapore when it comes to optimizing their websites.
  • Even the top 5 websites of Malaysian property developers score below the averages of the US and UK counterparts.


Contents

  • Searching the internet
  • How do search engines work
  • Why page rank is important
  • How to compare website performance
  • Comparative website performance
  • Can companies improve their website performance?
  • Pulling it together


Website performance


Searching the internet

The internet has become the first place for many people to search for information. 

This is also true in the context of looking for properties.  A good example of this can be seen from the chart below based on Google Trend.  

It shows the relative number of searches Malaysians have done over the past 5 years for the phrase “where to stay”. 

You can see the increase in interest over time.  
  • The “dip” started in Mac 2020 due to the national lockdown (Movement Control Order or MCO) instituted to control the spread of the Covid-19 virus. 
  • But you can see the interest building back up as the country eased the lockdown restrictions. 

Malaysian interest over time for "where to stay"
Chart 1: Interest over time

Given this interest, how many find their homes through the internet?

I could not find any equivalent statistics for Malaysia.   
  
However, the US National Association of Realtors in July 2020 reported that 52 % of homebuyers in the US found their home through the internet.

And the main source of information when such online searches are done is the company website.

Information sources for home search
Chart 2: Source of information for home search
Source: US National Association of Realtors

It is common knowledge that people today search the internet to solve problems.  To do the search, they generally go to the home page of one of the search engines.

According to the Search Engine Journal the 3 most popular search engines in the world today are
  • Google with over 75 % of the search market share. Google processes over 3.5 billion searches every day. 
  • YouTube is today owned by Google. YouTube receives 1.5 billion logged-in users per month.
  • Amazon. Due to its success as an online store, more than half of the online shopping queries go directly to Amazon rather than to the traditional search engines.

How do search engines work

If you are looking online for a house in Malaysia you might start by searching for “top residential areas” through one of the many search engines. 

The search engine will then try to match your queries with the information it has collected.

According to Moz, search engines have three primary functions:
  • Crawl: Scour the Internet for content.
  • Index: Store and organize the content found during the crawling process. Once a page is in the index, it is in the running to be displayed as a result of relevant queries.
  • Rank: Provide the pieces of content that will best answer a searcher's query. This means that results are ordered by most relevant to least relevant.

In other words, when you type in your search phrase, the search engine will try to match your query with what it has in its database.  It will then present the results in order of ranking through the search results ranking pages (SERP). 

In general, you can assume that the higher a website is ranked, the more relevant the search engine believes that the website is to the query.


Why page rank is important

The search engine shows the most relevant results on the first page.  The less relevant results are then shown in the subsequent pages. 

There have been several studies that show the benefits of being on the top page of a search.
  • “Studies prove that 94% of Google clicks are from the first page of Google. Thus, it becomes indispensable to make your business visible on the first page of Google”  Tahrseo
  • "It’s a known fact that the first page of Google captures the majority of traffic. But did you know that there are significant differences in click-through rates for the top vs bottom results? One study shows the following click-through rates by Google position:
    • First result: 36.4% clickthrough rate
    • Second result: 12.5% clickthrough rate
    • Third result: 9.5% clickthrough rate"   Wordstream
  • “Bing reports that websites on the top get 42% of the traffic; the second gets 11% and the third only gets 8%. So, it clearly indicates why your websites need to be on top.” Impact

The conclusion is that if a website can reach the top of the first page of the search engine results, it can be an excellent opportunity for the business.


How to compare website performance

Given the importance of page rank, one metric to compare the website performance is then the domain authority or domain score. 

“The domain authority of a website describes its relevance for a specific subject area or industry. This relevance has a direct impact on its ranking by search engines, trying to assess domain authority through automated analytic algorithms.”  Wikipedia

You can think of a website domain score as a measure of how likely it is to rank on a results page. Generally, the practice is to have a score from 0 to 100 with a higher score corresponding to the greater ability to rank higher. 

Another indicator that can be used to compare websites is the amount of traffic it receives. 

Website traffic or the number of visitors to your website is important.  This equals the number of opportunities you have to add new customers - to promote your brand, to give an impression, and to build relationships. 

There are two categories of website traffic
  • Paid traffic - those that visit the site due to some paid advertising or marketing efforts
  • Organic traffic - those that visit the site following a search query. This is free unpaid traffic.

In the context of website performance, I will focus on organic traffic. 

Accordingly, I used these two metrics - domain score and organic traffic - to compare website performance.

Specifically, I compared the Malaysian property companies’ website to those of property companies in
  • USA - home of Silicon Valley and the leading global digital marketing company, Amazon
  • UK - because of our Commonwealth link
  • Singapore - our neighbour with a much higher digital penetration

A description of the method and the companies covered in the study is shown in Appendix 1.


Comparative website performance

To compare the domain score and traffic, I used a website analytical tool called Ubersuggest.  This provides the numerical score for each of the websites. (Refer to Note 1)

The results of the analyses are presented in the subsequent sections. Refer to Appendix 2 for the details. 

Domain score 

If you compare the domain score of the top 10 property companies in each of the countries, you will find that
  • Both the US and UK companies have a comparable average score of slightly greater than 60. 
  • The Malaysian companies’ average score is about slightly more than half of those of the US companies average score ie relatively poor 

In terms of how widely dispersed the domain scores are, I used a measure known as the coefficient of variation (CV). 

The CV represents the ratio of the standard deviation to the mean. It is a useful statistic for comparing the degree of variation from one data series to another, even if the means are different from one another.
  • Both the US and UK companies have a CV of around 0.15.   
  • Malaysian companies have a CV of 0.35 ie there is a bigger difference among that Malaysian companies.

Domain score of top 10 in each country
Chart 3: Domain score by country

Organic traffic

For organic traffic, the top 10 Malaysian property companies fall far behind their US, UK, and Singapore counterparts.  Refer to the chart below.

Monthly organic traffic for top 10 in each country
Chart 4: Monthly organic traffic by country

The website traffic of course is dependent not only on the companies digital marketing strategy.   It also depends on digital penetration in the country. To account for this, I scaled the traffic by the number of internet users in the respective countries (Source: Wikipedia)

The results show that Malaysian companies are very far behind those in Singapore  

Monthly organic traffic per m internet users
Chart 5: Monthly organic traffic per million internet users by country


The table below summarises the key statistics for both indicators.  

It shows that Malaysian property developers have yet to seize the digital marketing opportunities.
  • The best Malaysian domain score is the same as the lowest domain score for the US or UK 
  • The best Malaysian organic traffic is lower than those for the lowest traffic in the US or UK


Domain and organic traffic by country
Chart 6: Summary of website performance by country

Bursa Property Companies

There are 96 Bursa listed companies under the property sector.

What is the performance of these companies?
  • As a group, they have an average domain score of 21 with a CV of 0.70
  • In terms of traffic, they have a mean of 1,183 visitors a month and a median of 133 visitors a month.  The average results are skewed by some of the top performers as can be seen from the histograms of the domain score and traffic.
Histogram - Malaysian property developers Domain score
Chart 7: Distribution of domain score of Bursa Malaysia property developers 


Histogram - Malaysian property developers organic traffic
Chart 8: Distribution of organic traffic of Bursa Malaysia property developer

To give you a sense of the Malaysian property companies performance, I have also assessed the performance of some benchmark companies whose businesses are built on digital marketing.  

Website performance benchmark companies
Chart 9: Website performance of benchmark companies

The conclusion is that Malaysian property companies have a long way to catch up. 

Real estate agents

You may argue that many property companies employ real estate agents to market and sell their properties.  As such their own website performance may not be important.

Are Malaysian real estate agents’ websites performance better than those of the property companies?

Judge for yourself. 

Malaysian real estate agents Domain score and organic traffic
Chart 10: Website performance of Malaysian property companies and agents
Source: (a) Top10 of Malaysia (b) Asia Property Hq

The conclusion is that the Malaysian real estate companies’ website performance is not better than those of the Malaysian property companies.  

In fact, the average results of the real estate agencies have been boosted by the performance of some who are affiliates of global real estate agencies.

Top Malaysian Property companies

Assuming that the domain score is equally as important as the monthly organic traffic, the top 5 Malaysia companies with both good domain score and traffic in alphabetical order are

Digital marketing - Top 5 Malaysian property developers
Chart 11: Top 5 website performance - Bursa Malaysia property developers

You will note that even the top 5 performers have domain scores and traffic that are less than the averages of the US and UK property companies.

After more than 2 decades of the MSC Malaysia programme, it is very sad.

Details of the individual company’s performance are shown in Appendix 2

Can companies improve their website performance?

Covid-19 will continue to be a major disruption in our lives until possibly the end of 2021.  

Malaysian property companies’ performance next year may depend on how well they improve their digital marketing efforts starting with the website performance. 

I would think that the first step is to improve their website ranking through a process known as search engine optimization (SEO).

“SEO is the practice of increasing the quantity and quality of traffic to your website through organic search engine results.” Moz - the company that developed the Domain Authority metric. 

A search engine has a crawler that goes out and gathers information about all the content they can find on the Internet. The crawlers bring all those back to the search engine to build an index. That index is then fed through an algorithm that tries to match all that data with your query.

SEO is about trying to put up the content on a website so that 
  • Search engines will be able to understand what they're seeing, and 
  • The users who arrive via search will like what they see.

A website without effective SEO will not organically appear in the top spots on a SERP.   It thus won’t generate many clicks from search engines. 

Optimization can take many forms. 
  • Making sure the titles are informative and the right length
  • Using keywords that guests are likely to search for
  • Improving the website experience
  • Publishing relevant content including having a blog
  • Updating the content regularly
  • Improving the page speed
  • Building backlinks - links from other well- known sites 

But it is something that most Malaysian property companies have yet to pay attention to.

i-City

Companies with Leisure - one backlink opportunity

My analyses have been based on corporate websites.

In Malaysia, there are some property developers who have theme parks as one of the key components to creating vibrancy.

The more well-known of these are 
  • i-Bhd with i-City
  • Santoria Group Bhd with Bukit Gambang Resort
  • Sunway Group Bhd with Sunway Lagoon, 

As the theme parks are viewed as separate business activities, these groups have different websites for the leisure business.

Except for Sunway, the leisure websites perform better than the main corporate websites as can been seen from the chart below.

The idea then is to link the corporate website with the leisure sites so that the “domain score” of the leisure sites can help to improve the score of the corporate websites.

Domain score of developers with theme park
Chart 12: Domain score of property developers with theme parks

Note: Sunway Group Bhd is classified under the Bursa Industrial Products and Services category rather than under the Property sector and hence I did not cover them in the Bursa companies’ section of this post. 

Organic traffic for developers with theme park
Chart 13: Organic traffic of property developers with theme parks

Pulling it together

  • One way to assess the effectiveness of a company’s digital marketing efforts is to look at its website performance. 
  • Website performance can be assessed using the domain score and monthly organic traffic. 
  • Based on these, the website performance of Malaysia property companies is far behind those of its counterparts in the US, UK, and Singapore.
  • This relatively poor performance need not be permanent.  There are SEO efforts that can be adopted to improve website performance.

The spread of Covid-19 has made it more important for companies to adopt digital marketing.

As an investor, you want to know how far Bursa property companies have adopted digital marketing. Those who have incorporated this into their marketing strategy may be better off in the immediate Covid-19 future 

I hope that my analyses provided you with an approach to assess them. 

The results presented here can also serve as a base to track the performance over time.

END


Notes
1) Ubersuggest is a website domain research tool that enables the user to analyze keywords, content ideas, and backlink data.
  • Domain score - this is based on a variety of factors to indicate the overall strength of the website.  A score of 0 to 100 is given to the websites.  The higher the score the more authoritative the site is and the higher it ranks on Google. For example, Google has a domain score of 100. 
  • Monthly Organic Traffic - this is the estimated monthly traffic that a website gets given the organic keywords

Appendix 1 - Methodology

1) The domain score and monthly organic traffic for each of the websites were from the Ubersuggest analyses carried out between the last week of Sep 2020 and the first week of Oct 2020

2) The sources for the top 10 property companies in each of the countries were
  • US homebuilders - Statista.com
  • UK homebuilders - Brand New Homes.co.uk
  • Singapore property companies - Propertyhq.com
  • Malaysian property companies - iProperty.com

3) There were 2 sources for the Malaysian top 10 real estate agents
  • Top10Malaysia.com
  • Asia Propertyhq.com

4) The analyses were based on the respective corporate website.  This was generally identified by a Google search of the company’s name.  

5) Not all Malaysian property developers have been classified under the Bursa property sector.  We have not included the following in our comparisons:
  • Construction companies who also have development arms eg WCT, Naim
  • Companies with property development activities classified under other sectors eg Sunway, Eksons

Appendix 2 - Detailed comparative performance

1) Top 10 US Home Builders

Top 10 US Homebuilders website performance


2) Top 10 UK Home Builders

Top 10 UK Homebuilders website performance


3) Top 10 Singapore Property Developers

Top 10 Singapore Property developers website performance


4) Top 10 Malaysian Property Developers

Top 10 Malaysian property developers website performance


5) Bursa Property Developers

Bursa property developers website performance


6) Top 10 Real Malaysian estate agents by Top10


Top 10 Malaysia real estate website performance by Top10

Note: I could not locate the website for Richinprop Realtors


7) Top 10 Real Malaysian estate agents by Asia Property Hq

Top 10 Malaysian real estate website performance by Asia Property H




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Disclaimer
I am not an investment adviser, security analyst or stockbroker.  The contents are meant for educational purposes and should not be taken as any recommendation to purchase or dispose of shares in the featured companies.   Investments or strategies mentioned in this website may not be suitable to you and you should have your own independent decision regarding them. 

The opinions expressed here are based on information I consider reliable but I do not warrant its completeness or accuracy and should not be relied on as such. 

I may have equity interests in some of the companies featured.




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