In this 3 part article we are going to cover how you can use branding to build a competitive advantage, sales and marketing alignment for greater returns and why digital marketing is a must for higher profits and faster growth.
I can’t think of an equivalent product that is like off-plan property, you are effectively selling a promise with enormous value, asking someone to part with tens of thousands of Pounds/Dollars or Euros of their hard earned money with the commitment to hundreds of thousands, if not millions more at some time in the future.
Property development marketing is generally grossly inefficient. One of the outliers in the UK residential market are Galliard. They have a clear strategy, a systemic approach and are masters at matching their product with the market, providing themselves with a point of differentiation and selling in record time using a cohesive, online and offline marketing approach, heavily led by email marketing. There are some improvements to be made but all in all they do a great job.
If we leave the biggest developers to one side (no this doesn’t mean they always get it right). The fundamental flaw we see by the vast majority of small and mid-tier developers is the lack of sales and marketing strategy for their business. This leads to development only led marketing which is sporadic in nature and doesn’t provide long term value for the company and inhibits their growth potential.
In it’s simplest form, each development has a set budget, is marketed to buyers and sold via agents, with the developer exiting the scheme without a list of the leads that were generated by their money. That list goes into the sales agents database only for them to use it to sell other developers products, your hard earned money used to sell someone else’s product.
This is one of the reasons that property development marketing is so inefficient and one reason why the bigger developers are the bigger more successful players, they market to their databases, not only selling but building brand advocates.
Yes the agents need to receive the leads to contact them but you are missing out on literally millions of pounds of profits by not being able to nurture and cross sell YOUR other projects to the leads you have paid for.
A case in point when it comes to database marketing, Frasers’ loyalty program accounts for roughly 25% of the company’s total sales, that is huge. This investment in relationship/value led approach means that the ROI on their marketing efforts is far in excess of most.
Developers of all sizes can have effective database marketing, can you imagine how much easier and profitable your life would be if you could sell 25% of your developments to people in your database?
You will discover how digital marketing can level the playing field in part 2, but for now we move on to how great branding gives you a competitive advantage.
Developers tell us all the time that sales agents tell them people don’t buy brands, this misguided advice is driven by a fundamental misunderstanding of the power of brands and the inherent “them and us” sales and marketing dynamic. The fact is we all buy brands, the cars we drive or aspire to, are driven (excuse the pun) by our affinity with a brand and what that brand means to us.
Great brands hold a position in our minds and create an emotional attachment that holds enormous value. We pay more for the brands we love, we buy more of their products, we share them with more of our friends and we are more forgiving of their mistakes. A report by Business Week found that on average brands account for over a third of shareholder value.
The Berkeley Group do an amazing job of having a clear brand strategy that adds tremendous value to their business. They hold the position in their target audiences mind of quality and service, with their “designed for life” positioning statement and their customer first approach, with service running through the DNA of their business.
This corporate brand position translates to their developments giving them huge price elasticity and an almost unparalleled ability to charge premium prices. One potential downside to their approach however is that it is very difficult to differentiate their products, £10 million apartments and £300,000 apartments are presented in the same way.
So brands hold enormous value because of the way they make us feel when we think of or own the product. What does that mean to you when selling your development?
Wherever you are building there will be competition, meaning that there is choice for your prospective buyers. With similar size and specification, similar location, similar availability and amenities along with a similar price… how does a buyer choose?
With all things being equal they will choose the development that they feel more connected with full stop. It doesn’t matter whether they are an investor or an owner occupier the development that they feel and, the key word here is feel, aligns itself with them will be the one they choose to buy in.
“A brand is the set of expectations, memories, stories and relationships that, taken together, account for a consumer’s decision to choose one product or service over another”
– Seth Godin
The great news for you is that most development marketing is carried out with little thought as to who will be buying the product. A strong brand image for your business and your developments, created with a specific target audience in mind removes the likelihood of your development becoming commoditised, meaning your developments sell faster, with less dealing margin and at a premium.
We provide a complete end to end solution for property developers so if you want to create long term value for your business, accelerate your growth and sell your developments for more lets talk!