As a real estate broker you have a few functions to perform for home sellers. Stuff like guessing a probable sale price, taking dozens of bad pictures of your new listing, posting information into the MLS about your new listing, posting information into Zillow and fifteen million public websites about your new listing, bashing a tin sign into the earth at your new listing, wasting time on open houses, creating a really boring “virtual tour”, printing flyers, mailing postcards, calling back craigslist freaks, spamming every broker in your metro area with emails about your new listing, catering a broker open house, updating your Facebook page with your new listing, tweeting the heads of state for all known countries about your new listing and what you had for lunch, updating your LinkedIn page with your new listing to make all your broker friends jealous, eventually negotiating the sale, dealing with the plethora of paperwork, grinding it all out through appraisals, inspections and the buyer’s lender, screwing in the “sale pending” rider into your sign, and living long enough to close.
But do you realize nothing mentioned thus far has anything to do with marketing your seller’s home? None of it. Yes, go ahead and re-read the first paragraph so you can try and prove me wrong.
Marketing means first understanding your market’s desires (home buyers), then creating a solution better meeting those desires than what your competition is offering. But you think that you are already doing that through the long list in paragraph one. No you’re not. At best you are advertising in various mediums things about your seller’s house—but not the most important stuff buyers desire, just the stuff you think is important like number of bedrooms, number of bathrooms, and square footage.
Here’s a simple example that will help you to understand what marketing (understanding then meeting your market’s desires) is. Let’s say your company sells light bulbs—a simple product, much simpler than homes. You are specifically assigned to sell light bulbs to photographers. How would you entice the photographers to purchase your light bulbs? Hint: they don’t want light bulbs.
What are your market’s desires?
- They don’t want a light bulb; they desire perfect lighting.
- They don’t want perfect lighting; they desire perfect pictures.
- They don’t want perfect pictures; they desire happy customers.
- They don’t want happy customers; they desire tons of referrals and new business.
- They don’t want tons of referrals and new business; they desire a distinguished reputation.
- They don’t want a distinguished reputation; they desire complete success.
- They don’t want complete success; they desire heaps of money.
- They don’t want heaps of money; they desire to retire very early and spend all their time traveling and taking pictures of the coolest places on the planet—at their own leisure.
Can you see how the desires and associated emotions of your market incrementally escalated until you reached what they really desired the most? Each step brought you to higher emotional connections between your product and their desires.
Marketing means understanding this array of desires and their associated emotional triggers, and then providing a solution better meeting them than your competition does.
Nobody Wants a 3-Bedroom House
Home buyers don’t want square feet, bedrooms, and bathrooms; they desire emotionally charged future life experiences. There will be (in good homes) certain attributes that trigger buyers to envision these future events, immediately derive the emotional benefits of events yet to occur, and value that home over all the others.
Just as your photographer had no real interest in light bulbs, your home buyers have no emotional connection to square feet and bedrooms. These are just some base requisite set based on their needs. Their attachment and valuation of a home has fully to do with a home triggering those envisioned future events and the emotional benefits associated with them. Understanding your market’s emotional triggers and then providing those to them is marketing.
Once More Please…
Here’s the difference: advertising is “telling” your market why your solution is the best (based on their desires); marketing is designing the product or service to better meet your market’s desires than your completion does.
Therefore, marketing your seller’s home means preparing it to meet the buyer’s desires—better than your competition does.
Just as a photographer is not emotionally drawn into a discussion of your light bulb’s wattage, lumens, or average life span as these do not relate to their desires, your home buyers are not emotionally drawn into counting bedrooms, bathrooms, and square feet.
If these were the most important items to buyers they would always buy the very cheapest house fitting these criteria. That’s the logical choice. But they don’t.
Home buyers aren’t buying “x” bedrooms, “x” bathrooms, and “x” square feet; they are buying the emotional benefits derived from visualized future life events triggered by a particular home. They pay for the emotional benefits of things that have not happened yet, but that they visualize happening in the future within a particular home. And marketing means that you discover what those emotional desires are, get the home seller to understand how vital it is to provide those triggers and demonstrate the probable financial return for doing so, then finally actually providing the triggers within you seller’s home that sets off those buyer’s emotions. This is marketing and happens before you advertise anything.
But you know that—you know buyers have dreams, life aspirations, and desires, and that’s how you present information in your advertising. Okay, maybe. But that’s still just advertising. First delve into true marketing by helping the sellers to understand what the buyers in their area desire the most. Try to help them understand that by giving the buyers what they desire the most your sellers in turn can receive what they desire the most. (What your seller desires the most is probably not “just sell the house”, “just get me top dollar”, or “get me closed in 30 days”—these are all simply rational requisites barked by your seller.) They must have some more important life aspirations of their own that selling the home allows them to attain. Think back through the light bulb story and now understand what your sellers really desire—the emotionally driven stuff. Oh, and offering the buyers a home meeting their foremost desires completely takes care of the three seller demands just listed.
Before placing your seller’s home on the market and blasting out your ads, talk to them about considering any upgrades needed that meet the real desires of the buyers in your specific area. And we’re not just talking about neutral paint and carpet.
Again, you are doing the best job of marketing your seller’s home by understanding and giving the buyers what they desire. The bedroom and bathroom count are base requisites—they’re only looking at houses already meeting those needs, so you can’t differentiate the property based on any of these.
And yes, the home needs to be in decent condition—so again you’re not going to differentiate yourself based on neutral carpet and paint.
How Do I Know What the Buyer Desires?
But how can you know what the market really desires; what triggers their emotional desires? It’s nothing you can list in a generic sense for all buyers and all areas. Buyers of restored Victorian homes have very different desires than buyers of urban lofts carved from prior factories. One wants 150 year old balusters, 12” trim molding, and period-correct finishes; the other wants a 150 year old building with stainless steel cabinets, 2” thick glass countertops, 16 foot tall ceilings, and concrete floors. Every neighborhood’s emotional triggers are different; you must discover them.
It’s actually not hard to demonstrate to home sellers the market’s specific desires, and why some homes sell for 75% higher than the median price for the neighborhood, while others sell for 75% less than the median price in the neighborhood. Just pull all homes sold over the last twelve months. Import the information into Excel. Complete a sort function based on price per foot (above ground square feet), and place the homes in descending order with your highest prices at the top.
Believe it or not you can ignore the bedroom and bathroom count, and instead concentrate solely on the public and private text descriptions, remarks, and inclusions. Take ten minutes to note what the highest price per foot homes had beyond the offerings of the median priced homes in the neighborhood. These items are what the buyers in this area desire the most—their emotional triggers, and what they will pay the most to obtain.
The next couple of paragraphs get a little deeper than you wanted to go, but the list of items the market desired which you discovered with this little exercise is not the final word on why the buyers paid more for these homes.
Home buyers aren’t paying more just for the physical elements your analysis extracts from the MLS descriptions; they are buying the emotional benefits derived from visualized future life events triggered by these elements within a particular home. They see the form, function, flow, and finish of the home, and each key item triggers some emotional benefit from visualizing future events (new baby, fabulous dinner parties, kids playing, wonderful bar-b-que on the patio, Christmas morning with a fireplace and a 12 foot tree,–you name it). Actually the market names it; you just interpret it from your analysis.
The market tells you what they desire the most from their actions and how much they will pay to attain those desires. The more desired triggers a home has, the more the market will pay to acquire the emotional benefits associated with them. You are now coaching the sellers toward true marketing: understanding your market’s desires and offering them something better than your competition is.
This is Too Much Work
Yep, you’re absolutely right, this is a lot of work, and some sellers will not consider improving their home to meet the buyer’s desires, but some will—and those will be great listings. The buyers will love the home and buy it quickly, and pay toward the top of values in your area for it. The sellers will love it as their home will sell quickly and toward the top of the values in your area. And you will love not having to deal with that seller’s call every week demanding to know why their home has not sold and what you are going to do about it.
Understanding what the market desires and offering to them a solution meeting their desires that is better than what your competition is offering is true marketing. Only after understanding and meeting your market’s desires do you advertise—communicate how your solution best meets your market’s desires. You now have a clear understanding of the difference between marketing and advertising.