Re Builder Conf 10 08v Final


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Shift Happens: Presentation by RE: Expert Consortium to Colorado Home Builders

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Re Builder Conf 10 08v Final

  1. 1. SHIFT HAPPENS The Great Paradigm Shift In Residential Real Estate Is Here Presented by the RE: Expert Consortium 10.09.08
  2. 2. What worked before – will not work again. Today’s buyers demand an elevated, customer-centric experience that demands you SHIFT your thinking and your actions… or face the consequences. Yesterday’s Buyers Today’s Buyers
  3. 3. RE: Expert Consortium Founding Members <ul><li>Metrostudy Wayde Jester, Director of Consulting </li></ul><ul><li>Lance Jackson & Associates Lance Jackson, Strategic Director </li></ul><ul><li>Trio Interior Design Angela Harris, Principal </li></ul><ul><li>The InterPro Group Z. James Czupor, Principal </li></ul><ul><li>Jennifer Gore Unlimited Jennifer Gore, Principal </li></ul>
  4. 4. WAYDE JESTER Director of Consulting Metrostudy Safely Getting to the Other Side
  5. 5. Safely Getting To The Other Side <ul><li>THE PAST </li></ul><ul><li>Size of Denver Market was 20,000 Homes </li></ul><ul><li>Mortgages Were Easily Obtained </li></ul><ul><li>Consumers Looked at Homes Like a Blue Chip Investment </li></ul><ul><li>TODAY </li></ul><ul><li>Size of Denver Market is 7,000 Homes </li></ul><ul><li>Credit Markets Have Chilled </li></ul><ul><li>Consumers Have Lost Equity in Their Home </li></ul>
  6. 6. Bank on This… <ul><li>Most of your competition will continue to do business the same way, refusing to adapt to a new market environment Distressing times always produce winners; they are the ones who have paid attention to the market shift and adjusted their strategies Consumers are fence sitting right now, but when they return to shopping for a house they will respond to good value – “flight to quality” Big Builders have the advantage of in-house financing, but when the market picks up they are not prepared to ramp up production having lost key personnel </li></ul>
  7. 7. And This… <ul><li>Colorado is the 5 th best job producing State in the Country, many thanks to the energy business, but also because we have a diversified economy with tech, bio tech, tourism and manufacturing. Absent a price bubble, home values locally have less downside risk. Year over year Denver SF prices are down 14% compared with 20 and 30 percent in AZ, NV and CA. Metrostudy expects demand to pick up by Summer 2009, gradually for sure, but some of the fences sitters will jump back in. While it may be a decade before we reach the level of homebuilding activity we achieved in 2005, Denver and the State of Colorado have very good long term prospects. </li></ul>
  8. 8. Important Questions: <ul><li>Are we a unique builder defining our own niche? – Buyer profile, depth of market Are we a common builder looking for a fair share of the market? – Number of competitors, current supply and demand Do you need help answering these questions? </li></ul>
  9. 9. LANCE JACKSON Strategic Director Lance Jackson & Associates The Shift in Defining and Communicating Who You Are
  10. 10. The Shift in Defining Who You Are <ul><li>THE PAST </li></ul><ul><li>You stated with pride the number of years you have been a quality builder, or the number of years you’ve been building homes (number of years or homes has little interest to anyone except yourself) </li></ul><ul><li>TODAY </li></ul><ul><li>You must declare your credentials and unique ability to deliver your brand’s promise – every time (think about proprietary methods, protocols, etc.) </li></ul><ul><li>The DEPTH your brand has to offer </li></ul>
  11. 11. The Shift in Defining Who You Are <ul><li>THE PAST </li></ul><ul><li>Your builder story is based upon your history as a builder or developer… and that will be enough to differentiate you (yet, in your market’s mind, they all read the same) </li></ul><ul><li>TODAY </li></ul><ul><li>Your brand must embrace your personal vision for your enterprise, and your customers ( if you do, your brand will be unique) </li></ul><ul><li>The DESIRE that drives your brand </li></ul>
  12. 12. The Shift in Defining Who You Are <ul><li>THE PAST </li></ul><ul><li>Your builder story was a well-crafted paragraph about “attention to detail,” “craftsmanship” and “design” (overused/common and undistinguishable) </li></ul><ul><li>TODAY </li></ul><ul><li>You must declare with clarity and brevity the market want you are fulfilling (Unique Selling Proposition – USP) </li></ul><ul><li>The DEMAND your brand is fulfilling </li></ul>
  13. 13. Your Brand’s Unique Selling Proposition
  14. 19. Home Buyer Internet Usage <ul><li>84% of active home buyers use the internet in their search for a new home. </li></ul><ul><li>Source: 2007 NAR Profile of Home Buyers and Sellers </li></ul>
  15. 20. The Shift in Communicating Who You Are <ul><li>THE PAST </li></ul><ul><li>Your web site is static – a “brochure-ware” site </li></ul><ul><li>TODAY </li></ul><ul><li>Your web site must be dynamic </li></ul>
  16. 21. The Shift in Communicating Who You Are <ul><li>THE PAST </li></ul><ul><li>You publish information regarding new locations or home designs </li></ul><ul><li>TODAY </li></ul><ul><li>Your web site must be interactive – think of it as a conversation venue </li></ul>
  17. 22. The Shift in Communicating Who You Are <ul><li>THE PAST </li></ul><ul><li>You use your web site to inform those who happen to visit it </li></ul><ul><li>TODAY </li></ul><ul><li>Once your web site is engaging and dynamic – promote it at every opportunity </li></ul>
  18. 23. The Shift in Communicating Who You Are <ul><li>THE PAST </li></ul><ul><li>You control the dialogue – one set of messages to everyone </li></ul><ul><li>TODAY </li></ul><ul><li>Use your web site to collaborate with your prospect, your buyers and your home owners </li></ul>
  19. 26. ANGELA HARRIS Principal Trio Interior Design The Shift in Designing Desirable Product
  20. 27. The Shift in Designing Desirable Product <ul><li>THE PAST </li></ul><ul><li>Build it and they will come is a method of design. Great location is all you need. </li></ul><ul><li>TODAY </li></ul><ul><li>The customer is much more educated on sustainable design, exterior materials, floor plan layout, functionality of spaces, finish level, technology, and will ultimately demand what type of product is marketable and should be built. </li></ul>
  21. 28. The Shift in Designing Desirable Product <ul><li>THE PAST </li></ul><ul><li>The highest level of finish is desirable. </li></ul><ul><li>TODAY </li></ul><ul><li>The customer wants to see efficiency, consistency, and the appropriate finish level for their personal lifestyle. What are the buying patterns of your audience? Does the overall finish package make sense to them? </li></ul>
  22. 29. The Shift in Designing Desirable Product <ul><li>THE PAST </li></ul><ul><li>Space design is sacrificed for high end appliances and a high level of finish. </li></ul><ul><li>TODAY </li></ul><ul><li>Livability and functionality of spaces are vital to the success of a project. Taking the time to analyze room sizes, door swings, number of spaces, storage space, and the use of spaces, along with your finish package is a critical path to a successful project. </li></ul>
  23. 30. The Shift in Designing Desirable Product <ul><li>THE PAST </li></ul><ul><li>We were successful with this floor plan, exterior elevation, and overall product in the past. We should stick with what works. </li></ul><ul><li>TODAY </li></ul><ul><li>Value added design elements such as extended outdoor living areas, differentiating exterior elements, and technology packages set you apart from your competitor. What are your value added design attributes and do they speak to the location and audience of your project? </li></ul>
  24. 31. Exterior Elevation – Customize Your Home
  25. 32. Livable Spaces – Speak To Your Targeted Customer
  26. 33. Finish Level – Speak To Your Targeted Customer
  27. 34. Outdoor Living – Value Added Attributes
  28. 35. The Shift in Communicating Your Design <ul><li>THE PAST </li></ul><ul><li>A full set model home is the only avenue of showcasing your home and speaking to your targeted audience. </li></ul><ul><li>TODAY </li></ul><ul><li>The usage of space and scale is important for buyers to understand. If a model home is not affordable, builders are looking to alternate solutions such as staging. Showcasing your home in the appropriate capacity is important. </li></ul>
  29. 36. The Shift in Communicating Your Design <ul><li>THE PAST </li></ul><ul><li>Live sales centers with conceptual boards and model vignettes is the only way to communicating the finish level and design of the product. </li></ul><ul><li>TODAY </li></ul><ul><li>Interior renderings and animated virtual models are a great tool for pre-sale opportunity. Creating the “experience” for the buyer is an important step to reaching and communicating the value of your projects. </li></ul>
  30. 37. Staging a Model
  31. 38. Virtual Renderings
  32. 39. Virtual Experiences
  33. 40. Virtual or Animated Rendering
  34. 41. Z. JAMES CZUPOR Principal The InterPro Group The Shift in How to Promote Your Business
  35. 42. The Shift in How to Promote Your Business <ul><li>THE PAST </li></ul><ul><li>Newspaper ads </li></ul><ul><li>Billboards </li></ul><ul><li>Bus Boards </li></ul><ul><li>Direct Mail </li></ul><ul><li>Television </li></ul><ul><li>Public Relations </li></ul><ul><li>On Site Signage </li></ul><ul><li>Special Events </li></ul><ul><li>Radio </li></ul><ul><li>TODAY </li></ul><ul><li>Most Efficient and Cost Effective </li></ul><ul><li>Websites </li></ul><ul><li>Targeted Direct Mail </li></ul><ul><li>Targeted Email Campaigns </li></ul><ul><li>Public Relations </li></ul><ul><li>On Site Signage </li></ul><ul><li>Blogs/New Media </li></ul>
  36. 43. The Shift in How to Promote Your Business <ul><li>THE PAST </li></ul><ul><li>Newspaper ads </li></ul><ul><li>Billboards </li></ul><ul><li>Bus Boards </li></ul><ul><li>Direct Mail </li></ul><ul><li>Television </li></ul><ul><li>Public Relations </li></ul><ul><li>Special Events </li></ul><ul><li>On Site Signage </li></ul><ul><li>Radio </li></ul><ul><li>TODAY </li></ul><ul><li>Nice if you can afford it – wasted message reach </li></ul><ul><li>Newspaper ads </li></ul><ul><li>Billboards </li></ul><ul><li>Bus Boards </li></ul><ul><li>Radio </li></ul><ul><li>Television </li></ul>
  37. 44. Six Forces Impacting How You Promote Today <ul><li>1. Newspapers </li></ul><ul><li>2. Television </li></ul><ul><li>3. Internet </li></ul><ul><li>4. Aging Population </li></ul><ul><li>5. Emerging Population </li></ul><ul><li>6. Noise from Issues </li></ul><ul><li>– Financial Crisis/Bailout </li></ul><ul><li>– Housing Downturn News </li></ul><ul><li>– High Oil/Gas Prices </li></ul><ul><li>– Auto Industry Bailout </li></ul><ul><li>– Natural Disasters </li></ul><ul><li>– 2008 Presidential Election </li></ul>
  38. 45. 12 Strategies You Can Use Today <ul><li>THE NEW MARKETING MODEL </li></ul><ul><li>1. Your buyers are GOLD </li></ul><ul><li>2. Targeted Email, Targeted Direct Marketing – Multiple “touches” </li></ul><ul><li>3. Newspaper, TV, Radio </li></ul><ul><li>4. “YOU” Websites </li></ul><ul><li>5. Special Events </li></ul><ul><li>6. Sponsorships </li></ul>
  39. 46. 12 Strategies You Can Use Today <ul><li>THE NEW MARKETING MODEL </li></ul><ul><li>7. Sustained PR </li></ul><ul><li>8. Coordinate BRANDING, RESEARCH, PR, SALES & MARKETING, INTERIOR DESIGN experiences </li></ul><ul><li>9. Know your customer and speak your customer’s language </li></ul><ul><li>10. Key Messages </li></ul><ul><li>11. Be an Educator/Advocate </li></ul><ul><li>12. You are in the business of marketing </li></ul>
  40. 47. JENNIFER GORE Principal Jennifer Gore Unlimited The Shift in Your Marketing and Your Sales Teams
  41. 48. The Shift in Your Marketing & Sales Teams Housing Market Conditions <ul><li>THE PAST </li></ul><ul><li>HOT market </li></ul><ul><li>Build it and they came </li></ul><ul><li>Too much traffic </li></ul><ul><li>Quality control </li></ul><ul><li>Easy money </li></ul><ul><li>Buyers had home equity </li></ul><ul><li>Increasing prices </li></ul><ul><li>TODAY </li></ul><ul><li>Excessive Inventory </li></ul><ul><li>Build it and you wait </li></ul><ul><li>Too little traffic </li></ul><ul><li>Preserving capital </li></ul><ul><li>Tough financing </li></ul><ul><li>Buyers cannot sell current home </li></ul><ul><li>Discounts </li></ul>
  42. 49. The Shift in Your Marketing & Sales Teams Marketing <ul><li>THE PAST </li></ul><ul><li>No research </li></ul><ul><li>Signs </li></ul><ul><li>Newspaper/magazine ads </li></ul><ul><li>Website </li></ul><ul><li>Small percentage of co-op </li></ul><ul><li>Homeowner parties </li></ul><ul><li>TODAY </li></ul><ul><li>Never enough research – about buyers! </li></ul><ul><li>More signs </li></ul><ul><li>Testimonials and minimal print advertising </li></ul><ul><li>Dynamic e-marketing </li></ul><ul><li>Courting brokers </li></ul><ul><li>Public relations and event marketing </li></ul>
  43. 50. The Shift in Your Marketing & Sales Teams Sales <ul><li>THE PAST </li></ul><ul><li>Enthusiasm </li></ul><ul><li>Back-slapping the competition </li></ul><ul><li>No research </li></ul><ul><li>Greeting prospects </li></ul><ul><li>Taking orders </li></ul><ul><li>Stated income sufficed </li></ul><ul><li>TODAY </li></ul><ul><li>Perseverance </li></ul><ul><li>Wanting to slap the competition </li></ul><ul><li>Field research </li></ul><ul><li>Cultivating buyers </li></ul><ul><li>Artful negotiation </li></ul><ul><li>Proving buyer’s ability to buy </li></ul>
  44. 51. The Shift in Your Marketing & Sales Teams Sales <ul><li>THE PAST </li></ul><ul><li>No contingent contracts </li></ul><ul><li>Minimal broker relations </li></ul><ul><li>Keeping up with paperwork </li></ul><ul><li>Customer service </li></ul><ul><li>TODAY </li></ul><ul><li>Assisting buyer to sell current home </li></ul><ul><li>Necessity for co-op relations </li></ul><ul><li>Following up </li></ul><ul><li>Customer counseling </li></ul>
  45. 52. SHIFT HAPPENS Shift while you can before the bad news turns to good.