Applying the marketing mix theory to the real estate industry.
The consumer market is more fragmented than ever, and there is no one-size-fits-all approach to property marketing. So how can you create a property marketing plan that targets customers in this modern environment?
By applying the seven Ps of the marketing mix theory to selling property, realtors can determine a brand’s offering and develop a more effective property marketing strategy.
What are the seven Ps?
In 1981, the four Ps of the marketing mix theory – product, price, place and promotion – were expanded to the seven Ps of marketing, also known as the services marketing mix, by Bernard H. Booms and Mary J. Bitner. Here’s how applying them can boost your real estate business.
This is the object or service a business provides for a group of customers, which can then be marketed to them.
Whether you realise it or not a real estate agency is actually a service business, so your product is the service that you provide, primarily to your vendor, in marketing and negotiating a sale or rental agreement for their property. You are also providing a service to buyers by educating them throughout their decision making process. Providing tools such as market updates, that include local property sales data, are a great addition to your service – helping all parties in a property transaction come to an informed and agreeable pricing decision.
In the real estate industry, accepting the wrong listings into your business could also mean you are left with properties (products) that take a lot of time and effort to sell. Conduct research to gain an understanding of your target market and what they want. This will help to ensure you list the most sought after properties. Time on market will be shorter, meaning less of your time is required to support the property sale, and you’ll gain a more profitable rate of return.
Understanding that there are two levels to your product offering, the physical property and the service you provide in bringing two parties to an agreed understanding in the transaction, is key to being a highly successful agent or agency.
This is the price the customer pays for the product or service.
As a real estate agent, if you don’t price a property correctly, it doesn’t matter how much marketing you do – the property is unlikely to sell. Having a pricing strategy and educating your vendor on buyer behaviour helps manage the emotional rollercoaster they will typically face. You can also become an authoritative source of information and highly sort out expert by staying abreast of pricing trends in your area.
Property prices may also fluctuate, for example a great deal of investor activity may be poised to take place before the end of a financial year due to a legislative change. Understanding the seasonal sales cycles and rental migration patterns of your area is important so that you can advise clients as to when demand may be greatest for their property and a higher price achieved. So conduct research regularly and ensure your market knowledge stays up to date.
3. Place or positioning
This is the location where the product or service is made available to the customer.
This can be either a physical location (bricks and mortar) or digital presence (your online shop front), but most typically in real estate it is a combination of the two.
Your brand sets the face and the tone of voice for your agency and is often conveyed through your visual marketing, physical office as well as the presentation and professionalism of your staff. Each of these are the ‘touch points’ or ways and places in which your customers interact with your brand.
Its important to establish a well thought through brand, and communicate key messages about your business in a consistent way. Each time your customers interact with your brand they should have an experience that rings true to your company ethos. This is the key ingredient to establishing a market leading real estate brand.
These are the efforts of a business to encourage the popularity of the product in the market.
Although there has been a shift towards digital marketing, recent research confirmed that properties advertised in print and online mediums sell faster and for more money than those advertised in online media alone. The research by CoreLogic RP Data revealed that 84 per cent of homes in Melbourne that were advertised on print and online media sold within their campaign period, compared to 63 per cent that were advertised using online media only.
You can also include QR codes and details for your website and social media profiles in your print material to point audiences in the direction of your online presence. Another technique is to amplify messages across social media or using paid media across digital platforms where your ideal customers typically hang out.
These are the people directly or indirectly involved in the trade of the product or service.
Marketing is a team effort, and your whole team will be directly or indirectly involved in how you sell properties. By establishing a positive culture and providing training for employees across the business, you can ensure they have the ability to provide the best service. Offering training will also help to retain staff and ultimately strengthen your agency’s brand in the market.
6. Physical evidence
This includes any physical representation of the product or service involved in the interaction between an real estate agent and a buyer or renter.
Putting standardised processes in place and creating templates for your property marketing will help reduce errors, minimise the time required to develop new material, streamline approval processes and ensure you have consistent brand messaging. It can also help you track the effectiveness of spend across multiple channels and measure the results for campaigns.
These are the procedures or steps that a business must take to deliver a product or service to the customer.
By putting processes in place that teach employees how to effectively communicate with clients as well as provide a mechanism for customer feedback, you can strengthen your relationship with them. Although every client in real estate will have a different need or want, the basic processes should ensure that every client receives the same level of service. Then within the service there should be defined areas where a client preference can be accommodated to provide a unique experience.
The final P in property marketing
Whether you are using the seven Ps or original four Ps, your marketing mix plan plays a vital role in ensuring your products reach the right audiences.
By creating a property marketing strategy that considers various elements that can influence a client’s buying decisions, you can rest assured your marketing dollars are being spent wisely and delivering the required returns.