We all know the story of teaching a man to fish is better than just fishing for them. Many of us may realize through times of adversity come opportunity. How are these connected to home building?
For decades, in cycles, builders have made money. When times were good, they simply fished with a big net. It was more or less easy to find a buyer for a home one was building.
This concept of throwing a net out there to catch what you can is changing in the world, and especially fast in the United States. Instead of going out and scooping up, the new way is to become a magnet. Builders will have to change from being fishermen, to being high powered magnets. Some builders already are, others are planning to catch up, and some have not yet put the planning in place.
How do you pull, instead of scoop? The shift will require companies, including builders, to push out quality content, in mass, very quickly, but in a more sophisticated way than previously done. Builders will have to be more than providers of product; they will need to become trusted resources and destinations of information. They are already a destination for decorating advice; consider the many “looky-loos” using your model homes as examples of decorating advice. Society will force builders, at least highly profitable ones, to do a better job of attracting people. Why? Because people have more choice than ever before, but less time, and therefore can only go where they are strongly attracted. Enter the magnet builder.
Causing people to want to come to you is a very different effort than just pushing information out or scooping up not so relevant or targeted contacts. In order to succeed in the next 5 years it is no longer just about market share, it is going to be about raising awareness, providing resources for free, and gathering people, especially targeted, interested and qualified consumers.
Profitable companies will need to continue expanding audiences (leads, prospects, followers, interested people, etc), distributing content, developing both short term, mid-term and long term relationships and leveraging new marketing methods. This is because there is a shift as the individuals and companies that make up our society drift away from traditional advertising and methods such as print. Whether we speak of politics, right wing, or chicken wing, front wheel drive, or market driven, it is all about change, and the bendable tree will weather a minor storm.
Builders already have the content, which is the world of new homes and all there is surrounding it. Now they have to find a way to be a magnet. Many builders could start up an education arm (buying smart, title insurance, mortgage qualification, remodeling for profit instead of lifestyle, positioning a house for resale, etc) that is only passively aggressive to actual sales. If you the builder become the number one source for consumer knowledge in your town, you will get contacts, and an association of integrity and trust. If you as a new home builder sponsored a seminar for your city on a sensitive subject, such as “The realities of buying a new home”, it might look at face value that this was suicide. It is not. It is actually a way for consumers to start noticing you. Few if any are going to be put off when you tell them to plan for investment beyond the payment and to think of things like a new trash can, yard maintenance and homeowners insurance. If anything, you can position them to buy new so they don’t have the “unknown” of wherever they are now. There are many other examples of this “reverse-strategy” concept.
Consider another sensitive topic: Buying Homes-How Ethnic Groups Respond. That is certainly an enticing or catchy topic. Bring in a panel of local experts from Asian, Hispanic and other groups, to speak directly to consumers about what those demographics look for in buying a new home. You are just there as a sponsor to scoop up the contacts you pulled, as a magnet, to the event. Now you are both a net and a magnet.
What else can you do?
A builder can leverage their web site, and use tools such as Twitter, Facebook business pages (using your CEO or President, personally) and others, while still selling the dream of a new home, the lifestyle and the freedom.
Think outside the box, bun or bag and stop thinking of yourself as a builder. You are MUCH more than that. Market vicariously. Embrace the gorilla, elephant, whatever you call it; leverage it and stop hiding. Capitalize not just on a product, but your intellectual capital!
Erik Cofield, CGA has leveraged technology and provided business management consulting for all sizes and types of builders, developers and Remodelers since 2000, including volume, multi-family and custom, to help them improve their business. He is a VP with BuildTopia (www.buildtopia.com), a widely used international construction management software company. He can be reached via ecofield@buildtopia.com