Real Estate Marketing Plan Results - First Development
Marketing Plan
If you remember from a previous post, we had decided to not have the development’s agents represent our property because of their unwillingness to negotiate on the 6% commission. We were going to sell the property ourselves. We developed our own marketing plan that consisted of:
- Produce color renderings and floor plans and have them mounted and on display at the construction site along with contact information to attract any “drive-by” traffic.
- Advertise in the NY Times real estate section as well as in a number of other metropolitan papers.
- Set up a Google Adwords campaign targeting people searching for homes on this particular lake or region.
- Send out a mailing to everyone who had previously bought in the development to start some word of mouth buzz with family and friends of current owners.
- Contact the individual sales people in the development and offer a 3% bonus for a sale.
Interim Marketing Results
Construction was progressing well. We were hoping to pre-sell the property through aggressive marketing. However the interim results were disappointing. We had a tremendous amount of “drive-by” traffic. The development’s agents brought many people through our house to show them the types of homes and level of quality being built in this particular development. However, we did not get one expression of interest in all this foot traffic. On following up with some of the people, the agents were telling them they could buy a lot, hire a contractor and build a place for themselves much cheaper. The prices per square foot that they were telling these prospects they could build for was way too low. A number of builders were having to deal with the fall out of people buying the lot and then finding out what it really cost to build. The agents for the development were interested in selling lots and they didn’t have this listing so there was no incentive for them to try and sell this property.
Out of six rather expensive advertisements in national and regional newspapers, we received 5 calls. Two people actually flew in and looked at the house but no offers were made. We had a tremendous number of clicks on Google AdWords. Thankfully the cost per click was inexpensive. We didn’t get any serious inquiries from this advertising. We did get quite a bit of buzz around the development from the mailing. However, it didn’t result in a single visit. The offer of a bonus also didn’t result in any offers. The salespeople were afraid of losing their jobs if word got out that they sold the home outside of the current commission structure.
Analysis
Lesson learned - The people who actually came to look at the home couldn’t really visualize how the home would look when finished. We were asking $2.375 million for the home. At this stage of construction, none of the finishes were done. The kitchen wasn’t installed. The bathrooms weren’t complete. Tile wasn’t complete. People were just not going to spend that kind of money without seeing the final product. In hindsight, we should have waited to begin marketing when the home was nearing completion. We lost out on a number of potential buyers by not making a great first impression.
