Posted on: Saturday, May 28th, 2011
Written by Dawn Sadler
How many homes do you want to be selling? What profit margin do you want to be achieving? What kind of people do you want to be working with? How do you want to be thought of by your homeowners? What do you want people to be saying about you around the water cooler or at the Starbucks in the cities and towns where you build?
Now let me ask you this. Which of the following will lead you there:
- Lower prices
- Bigger incentives
- More upgrades as standard
- Less upgrades as standard
- A free trip with every home
Incentive-based selling is a reality of our business. And it’s true, these might work to sell a home today. But does that mean the same thing as growing a legacy home builder brand over the next few years?
Incentive-Based Selling Doesn’t Scale
If we are doing the same things to sell a house today that we did last week, last month, or last year then it’s fairly easy to predict what kind of organization we’ll be in two years: still relying on incentive-based selling to move one house at a time, spending time and money to get the word out about our latest special. With this strategy, we will be waiting out the market to determine when we will be able to pull back on incentives, increase prices, and grow profit margins. It’s an unremarkable solution that, when used as a sole strategy for selling homes, keeps home builders from achieving the status of a trusted, legacy brand that serves generations of homebuyers.
The Legacy of Tomorrow vs. the Reality of Right Now
We all have lenders and shareholders and management and bank accounts that need immediate results, and incentive-based selling is a tool. I completely get it. I personally craft incentive based home builder campaigns all the time. There is a time and place. But as we create incentive-based programs that sell homes today, how can we concurrently be building a more lasting legacy that turns today’s marketing messages into something more than throwaway ads and social media spurts? How can we be investing daily in the success of our brand (either ourselves or our company) to insure ourselves against the next downturn?
The Secret Sauce of a Building a Legacy Home Builder Brand
The only real home builder marketing that scales is referral marketing. Every happy homeowner (or broker) that you create can generate several new leads and sales every year at a minimal cost to your bottom line. It’s the single greatest marketing asset that any home builder organization can have. But when your homeowners are standing at the water cooler (or posting to Facebook or tweeting) they won’t be talking about the closing cost credit that you gave them. They will be talking about their experience. Their experience with the sales team. Their experience with the construction team. Their experience with the customer service team. Their experience with the home. What transforms homeowners to brand advocates is never a line item on a closing statement. It’s how much you showed that you cared: before, during, and after the sale. Not how much you intended it, but how much they experienced it.
We’re all creating a legacy with our actions today. What’s yours?