February 10, 2009

New Ways

On a flight to Calgary to meet with several developers and friends. Thinking about what’s going on in the world — and specifically the world of real estate marketing and sales. Onni is a developer in Vancouver that has decided to go the route of drastic price reductions to clear out standing inventory. So far the response seems to be overwhelming. We heard rumours that 300 people an hour were registering for the program, and the first batch of 55 condos sold at one of their project locations in under 3 hours. I think this is a good idea; it will clear up old inventory and give Onni cash for operating in this new environment. It will be interesting to see if there is a snowball effect, and if other developers follow suit. If the whole industry used this approach to clean out the drains clogged with already-built homes, it may just clear the way for recovery with smart new offerings that are more in line with what people are looking for today.

I think we’ve spent a long time thinking about just one target audience — the low hanging fruit known as “wealthy baby boomers” — and that there are many other under-served segments that we could be serving. It’s also a time to return to TRUTH, and for developers to stop using hype and jive to sell over-priced homes. My belief is that a Miele appliance package and honed granite counter tops are no longer enough to justify hundreds of dollars per square foot over and above what the intrinsic value of the home should really be. Lets all start thinking about smart, sound, fundamental business principles, and about talking to a much broader spectrum of the public than we have in the past.

For example, who is to say that Gen X wouldn’t like to have a vacation home? How can we build something that they can afford? There was a trend I read about 10 years ago towards Gen X buyers investing in a vacation property first, then thinking about a place in the city where they work as a second home. Could we re-ignite that thought pattern?

Regardless of what direction new development planning heads in, we in the marketing business need to be thinking of new ways and new techniques too.

This entry was posted on Tuesday, February 10th, 2009 at 9:33 pm and is filed under Business. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.