Marketing campaigns are extremely important in a difficult market. From understanding the competition, creating a strategy and pinpointing the right mix of methods, learn how to create a marketing campaign that works for you and your properties.
By Meghan Boyer
An effective marketing campaign can increase property visibility, attract potential buyers and boost sales for real estate agents and developers — even in a down market. The recession, however, has many in the industry reevaluating business costs and cutting expenses. While it is important to keep spending in check in a difficult economy, industry experts agree that marketing is not the place to make drastic budget reductions.
“You have to stay in the game” and keep marketing, says Bryan Nooner, chairman of Distinctive Communities, a custom and new home builder based in Orland Park. “It is encouraged to define your position statement and reevaluate your budget, but you need to allocate sufficient resources to marketing in down times,” he says.
Scaling back on marketing is “the wrong thing to do,” agrees James Faircloth, broker associate with Prudential Preferred Properties. The marketing campaigns Faircloth helmed throughout the last year contributed in part to making it one of his most successful years to date, he says.
Many industry professionals have marketing success stories, but they also have finely tuned strategies to reach consumers and a deep understanding of their markets that help make their successes possible. Before launching a campaign, agents and developers should determine the most effective strategy to reach the target audience and complement the property, all the while ensuring the best use of marketing dollars.
Determining a property’s or development’s “value proposition” is an effective way to begin designing a marketing campaign, says James Hanson, principal with Mesa Development LLC. “We start with the value proposition. Why does someone want to live here? What about the property is unique?” he asks. “Once you know that, you think about the market and who it will appeal to.”
In terms of marketing for Hanson’s development The Legacy at Millennium Park, he has tried to focus on the impressive views visible from the building. “We’ll mention price, product, all that in the marketing. But we lead with our views” because they are unique to the development, he says. “We want to make sure people know us as the building in Chicago with the great views.”
In other words, “don’t advertise what everyone else is doing,” says Nooner. A good marketing campaign highlights what is different and unique about a property. To do that, an agent or developer must understand his or her competition and the market, he says.
After pinpointing a development’s value proposition, a marketer must choose the appropriate avenue to reach potential clients. “Any method of marketing can be effective if it is properly done,” says Michelle DePinto, a Realtor with Coldwell Banker Residential Northwest in Arlington Heights. She and Maria DelBoccio make up the M & M Real Estate Team.
One single method, however, may not be the best approach. “It’s not the one thing you do consistently, it’s the many things you do consistently,” says Nooner. An agent will miss markets if the only thing he or she does is print, he says, adding that his company uses multiple marketing methods simultaneously, including door hangers, direct mailers and radio spots.
It is important to spread marketing budgets among multiple advertising mediums, agrees Todd Bancroft, executive vice president of Equity Marketing Services Inc, who works with Hanson on marketing The Legacy at Millennium Park. For The Legacy, “we’re allocating the budget to lots of different areas,” he says, adding that there has to be multiple tools in a marketer’s arsenal.
The types of marketing methods that a developer or agent chooses to use will vary based on the property and its target audience. “We tailor a marketing strategy for each of our clients based on each person’s individual needs and so not every client receives the same coverage,” says DePinto.
The marketing budget also will depend on the property. In the past, “if you were to spend X amount of marketing dollars, you would expect to get X number of customers in the model home and X amount of closing,” says Nooner. The recession, however, has changed traditional budget models. There is a lot less cause and effect between marketing dollars spent and customer traffic and sales, he says. “There comes a point where the more I advertise has no results on my traffic,” says Nooner.
For example, Nooner may spend $1,000 on marketing over six weeks and attract consumer traffic. He then may spend $2,000 on marketing over the following six weeks and achieve the same level of consumer traffic. “If I don’t see any difference, I won’t pull out completely, but I won’t spend more,” says Nooner.
Using The Web
The Internet is one of the most cost-effective ways to market a property, and it provides the broadest audience to expedite interest, says DePinto. Buyers’ habits have changed overall, and many utilize the Internet in their home searches. Effective agents use the Internet to market homes by providing photographs, property details, neighborhood information, interactive maps and visual tours, she says.
The Internet should be a major marketing element for agents and developers, says Nooner. “You get the biggest bang for your buck with the Web, but you need it properly developed and managed,” he says. Real estate professionals need to create more than a basic Web page. “If you expect to drive traffic to your Web site, you need to commit to it,” says Nooner, adding that having the site developed by a professional marketing company may be the most effective route for many industry members.
Faircloth has multiple Web sites operating for the different properties he represents. His property-specific Web sites include information on the buildings, retail sales and units for sale. Some agents create Web sites about themselves instead of their properties, notes Faircloth. “What you are and who you are and who you have dealt with should not be the whole focus of the Web site,” he says. Though experts do agree that some personal identification is important for branding, it can not be the only thing on a Realtor’s site.
Some methods of reaching consumers on the Web can be ineffective, notes Faircloth. For example, after receiving an e-blast from an agent, many consumers activate their spam-blocking e-mail capabilities, he says. “We’re starting to become introverted agents and not talking to clients,” cautions Faircloth. It’s important not to rely too heavily on Internet-based marketing tactics.
With the convenience and low cost of Internet marketing, there is a danger of becoming too technologically advanced and losing one’s personal touch, agrees DePinto. “We believe that even though our industry has made tremendous gains technologically, people still want to do business with people,” she says. While computers and e-mail are vital business tools, “we make sure to always connect with our clients [and] potential clients via personal visits, regularly scheduled phone calls and personal handwritten mail.”
Marketing success can come in many forms, whether it’s a high-profile event that attracts attention or the mastery of a specific marketing tactic.
Faircloth is achieving success with informational postcards that he sends to potential clients. He sends postcards to 3,000 homes every eight weeks. While the cost is high, Faircloth remains committed to distributing the cards. “It’s like starting a magazine. You can imagine how foolish you would look if after the second issue came out there wasn’t a third or a fourth or a fifth,” he says. The cards include neighborhood market information with current and past home values. They also reference Faircloth’s Web sites that contain more updated information.
The postcard may be a traditional form of marketing, but it is effective and not gimmicky, says Faircloth. Sending a consumer a Cubs baseball schedule or recipes is expensive, and it does not say anything about the property or the Realtor’s abilities, he says. “The majority of the people I have done listings with have said sometime during the course of the listing that it’s a great postcard and they wouldn’t have listed with me if they hadn’t seen it,” Faircloth says.
Using a different tactic, Hanson and Bancroft have found success with high-end events that match the cost of the development and the target audience, they say. “The quality of the event translates to the cost, and it’s tied to the cost of the project and the luxury aspects of the unit,” says Hanson. The two held an event at the end of June in the modern wing of the Art Institute of Chicago, which had a direct view of the building and featured a speaker from the museum. Bancroft reports that the event was a tremendous success, and over 300 guests were in attendance.
Those invited to the event largely had purchased units in the development, and the event was meant to reinforce their purchase choice and give them additional information to share with friends and colleagues, says Bancroft. “We believe most of the purchasers that come in for the remaining units will already know someone in the building,” he says. “We stay purchaser-focused because we believe it’s the best bang for our dollar.”
Custom events that are “out of the box” also can be effective for certain properties, notes DePinto. The M & M Real Estate Team recently created a “Lifestyle Marketing Event” for a luxury property that had been on the market for 15 months. The one-day event provided a glimpse of the lifestyle one could have in a luxury home and included a framed art sale, catered food, floral designs and a wine tasting.
The interest in the event became so great that the team decided to open it up to the general public for a portion of the time instead of keeping it confined to the guest list, says DePinto. “We feel confident that we will not only expose the property to the right buyer potential, but we will also be creating a wonderful networking opportunity,” she says.
Setting The Price
Setting a marketable price for a property begins with a comprehensive evaluation of competitors, says Nooner. Many developers have fixed costs, such as land and building costs, that can not be reduced, which can make fitting into a specific price range difficult. When fixed costs require that a property’s price remain higher than the average in an area, “you better figure out a way to offer something else to the customer that gives them more value for their dollars,” says Nooner. “But if they are shopping purely on price, there’s not a whole lot you can do.”
Any new construction project is breaking new ground, and “costs do not go down,” agrees Bancroft. “Pricing is an art and a science.”
In pricing The Legacy at Millennium Park, Hanson knew he wanted to create a luxury, 72-story building and considered the cost involved in it. He then looked at the luxury market in the area and decided to create a building with broad appeal. “We don’t want to be the highest-priced building in town, and we don’t want to be the one where people scratched their heads and asked how they got that much money for the units,” says Hanson.
It is important to list a property so that it will sell, says Faircloth. If a client is not willing to be realistic about the current market value of the property, an agent should not take the listing. “An overpriced listing is an expired listing waiting to happen,” he says.
Marketing has become a necessary aspect of selling homes in today’s market. When the economy was strong, “marketing was not a necessity to sell your listings,” says DePinto. “A good price and a sign in the yard was all that was needed to get the job done,” she says. In the difficult economy, agents and developers have had to increase their efforts to get face-to-face with people and build strong interpersonal relationships, says DePinto. C.A.
Executive Vice President
Equity Marketing Services Inc.
Prudential Preferred Properties
Mesa Development LLC