Today I issue a wake-up call to real estate agents everywhere: Stop worrying about reaching specific market segments.
You don’t need to know about Generation X, Generation Y, Millennials, or the up-and-comers or the down-and-goners.
You want to label your prospects? I have the only three you need: ready, willing and able. Your problem is not the number of prospects you are working with. Many of you have more than you can handle now. Find the "why" and they will tend to buy.
I write this to those of you in the resale market because you have a wider choice, and you have only one task: Show your buyer a home they can picture themselves living in.
Don’t get caught up in the marketing label of the day. Leave that to the new-home industry and hawkers of retail products.
How would you label this hypothetical couple: They will not buy a home, new or resale, that does not have a place for their roll-top desk and an upright piano. Can you guess at their age or station in life? Does it matter? I close my case.
As a condominium marketing consultant, I have the invaluable opportunity to work with psychographic research.
In its simplest form, a psychographic market study measures attitudes and feelings, and helps answer the question, "Who is the market and why will they buy this specific product?"
When conducting such research, I had a one-two set of instructions for those conducting surveys: One, "Tell me why they will buy." Two, "Keep it simple."
What follows is a case study of what happened when a condominium developer marketed a 40-unit waterfront condominium community to the assumed market and failed, while the lender marketed to the smallest market and succeeded.
A Florida lender asked me to evaluate a number of distressed condominium projects and to recommend a disposition strategy. The problem with doing something this serious without the right research is that I tend to play it safe, as opposed to digging in to find the real solution.
The fact is I had no idea what to do with many of these properties, and could not know without a psychographic market study, a new concept to the lender.
The property was located near Cape Kennedy, where the race to the moon began and ended. Total presales and sales, with just weeks to go to before the developer would obtain a certificate of occupancy: zero.
The lender was nervous. He asked me to meet with the developer, who was out of funds, and make a disposition recommendation.
The developer said the market for his condominiums was the "’mover and shaker," the community leaders — bank presidents, attorneys and the like. "These are the people who can afford them." And he was right, there was a market deep enough along Florida’s Space Coast to buy 40 of these. But they obviously did not want one.
He was confident that if the lender would fund an aggressive advertising program, he could generate some sales. In other words, he had depleted his advertising budget targeting the wrong market with the wrong message. There was no reason to believe more advertising would work, until we knew who would buy these, and why.
I did not comment. I did what I always do if I think there is a retail market for the project, and in this case, I was not sure. So, I recommended to the lender that he authorize a psychographic market study — not only to determine the market demographic, but what might change their attitude about buying one of these beautiful condominiums within walking distance of restaurants and shopping.
As it turned out, the market was not the "mover and shaker" — it was the "achiever." I had not heard this term, so I asked the researcher what "achiever" meant.
"I am referring to a real achiever. Possibly a scientist working for NASA who has a Ph.D. from MIT, recognized by his peers as one of the most brilliant among them. That person."
Really? How deep could that market be?
"It’s not that deep, but that is not what is important. Attract achievers, and movers and shakers will follow them in, because movers and shakers love to rub elbows with achievers."
After a long afternoon of reviewing and listening to the researcher justify his assumptions, I felt I understood what he was talking about, and accepted the study’s conclusions.
The lender accepted the recommended ad agency to develop the creative strategy, communications plan and budget.
The agency selection paid off. We needed an achiever, and we got one: a lunar astronaut. A man who had walked on the moon.
Can’t name the name here, but he was well-known in that market. He agreed to purchase a unit and be our spokesman. With that done, we had a marketing liftoff like that part of Florida had never seen. When the astronaut brought two crew members to an invitation-only gathering of the area’s movers and shakers, it made the local news, including television.
We knew that we needed a second achiever to validate the "achiever" buyer. Before we knew it, he showed up and purchased. He was a globe-trotting veterinarian, who treated elephants and big game around the world.
And, of course, the society editor of the local paper was the first to know about the purchase.
Although I could have become the broker of record, I chose not to in this case. We brought in a local broker, well-connected with the local leadership, who agreed to staff the sales office with full-time agents.
And before long, movers and shakers up and down the Space Coast and second-home buyers from around the country were buying condominiums at retail prices, with a little help from below-market financing.
The lender eventually sold the first building, then a second one just like it with another 40 units.
The lesson: When it comes to targeting your listings, start by asking the seller why he bought the home. Listen closely and you will hear the potential buyer’s feelings and attitude that will help your copy zing.
Caveat: I neither conduct market research nor recommend research companies.