The great chicken / egg debate ... and property marketing?

Disclaimer - I write as I think. Mostly random musings fused together, but always with good intentions.

This is going to be a a very short post but one that has perplexed me about other real estate developers. Do note this is based on my assessment of how business is conducted across multiple continents through my interacting with business owners, developers, agents and other property professionals across various continents. 

"What developers want?" - probably could be the title of the most boring movie ever made, but a question that all us property professionals sometimes struggle to answer.

The most common answers usually are: 

• Rapid sales of new project / phase launches
• Increase selling price based on velocity of sales
• Open new markets
• Generate goodwill (brand recognition) that enhances sales prospects of future projects
• And the real kicker ....... do this on a negligible budget while adhering to an extremely strict ROI approach

I have absolutely no issues with the above points. In fact, these are bulletproof marketing mantras that every manager worth his / her salt should swear by.

So, what's the issue here? - Well, in a nutshell - one cannot plan for an ideal market only and ignore downturns and or plateaus, which is pretty much where most markets (barring a few) are currently. My evaluation of most global markets (again ... not all) can be summarised as per the following:

• Boring national economic forecasts leading to lower market activity
• Oversupply in many regions
• Unexciting and unpredictable rental yields
• Secondary market under performing compared to recent data (volumes and prices)
• Introduction of new taxes, cooling measures, foreigner purchase restrictions, etc

What these factors create is an extremely competitive market scenario where barring a few name brands and / or prime locations - price becomes the biggest (but certainly not the only) factor leading to buying decisions. This applies to retail as well as institutional markets.

Now, we come back to the paradox faced by your humble marketing manager. You have to generate revenue but are expected to do so with tight budgets and controls.

The conundrum here is that many developers also unfortunately adhere to a "Penny wise - Pound foolish" policy when it comes to marketing their products. As careful as your middle management may be when it comes to tip-toeing around a boss' demand for keeping costs low, prolonged periods of underperforming frequently lead to management busting open their bank accounts and going all out with massive roadshows, PR blitzes, full-page advertisements (in glorious Technicolor), TV spots.....you get the idea!

What surprises me is why so many wait for their initial strategy to fail or underperform before committing to ad-hoc Plan B, and then potentially spend much much more that they would have if one was allowed to build a strategic plan in the first place! I guess this is nothing new and is just how business has always been done keeping the highest profit margin in constant view. 

Well - the times, they are changing! While instinct and belligerence are oft-needed traits of successful marketing leaders, my humble opinion is that strategic thinking needs to be infused into their corporate DNA as well:

• Hire a strategic sales manager or encourage the use of common tools available to 'crowdsource' ideas from your employees
• Don't just say you're innovative - embrace the notion wholly. Try new technological solutions, ideas and practices
• Embrace digital! Yes, print and traditional media still do work, no doubt! But good (not just cheap) digital marketing is the future. Don't get left behind
•  Plan ahead and plan comprehensively accounting for not just roadshows but also PR opporunities, award nominations, other sales campaigns ..... and also plan for prices / rebates revisions (as needed)
• Don't blow your budget in one go! Make the most of it. Don't just try and create an impression but stretch your budget for longevity
• And last of all - create good agent relationships and treat them well. In good times, customers will flock to you. When the markets are down, it helps to have a fantastic agent network backing your sales team

 And that's a wrap!

To summarize, some glorious wisdom offered by the Star Wars universe:

"Do or do not. There is no try!"

"There has been an awakening, have you felt it?"

"This turn of events is unfortunate. We must accelerate our plans. Begin landing your troops"

Feedback, brickbats, criticism, healthy dialogue, etc always welcome. We live to learn!