These comments are only portions of a new John Deere Corporation marketing bulletin, recently introduced to its dealer network in Sarasota, Florida last month. It is extremely relevant to the real estate industry on two levels. Firstly, the fact that almost every major consumer marketing initiative, (even those that sell lawn tractors), is currently integrating segmentation marketing is significant to the real estate industry. There is a need for brokers to go outside the industry to find techniques that are effective with today’s consumer, this discussion is not happening on a large scale. Secondly, and perhaps a more dramatic level, comes from the fact that Deere is marketing to the exact same customer group being serviced by the real estate industry.
Even closer to “home” are the current efforts of Home Depot’s “You can do it, we can help” marketing campaign. Like the Deere program Home Depot is working hard to add value to its programs, products and services by “segmenting” its customer base on the basis of needs, demands and desires. “HO-D” programs, products and services are targeted to those who (1) want to buy the best tools and supplies to do it all themselves, (2) those who want to be “in control” but want assistance from qualified professionals and (3) those who wish to be safe while having a service provider complete their project.
In order for real estate brokers to add customer value through segmentation marketing they must emulate John Deere and Home Depot and take four steps:
• Become obsessed about gathering customer specific information
• Use the information gathered to analyze and segment their customers on the basis of needs and wants
• Tailor, target and execute selling efforts to those segments
• Customize each customer’s experience and respond to collected consumer feedback.
Through these steps the brokerage can address the challenge of meeting the “unique” customer demands for value and experience. More importantly, through these efforts the brokerage can begin to realize the magic 'twelve hundred dollar per transaction profit’ that has become the industry objective.
Leading edge brokerage firms which have integrated segmentation marketing into their business models have discovered the need to field a whole new set of sales competencies or skill sets. These firms have abandoned the “universal agent” concept in favor of a more specialized approach. Using these concepts to add value to the consumer experience requires the creation of a two dimensional matrix that identifies and monitors both customer segments and progress through those segment experiences. After several months of using this approach many firms have discovered that in the final analysis, real estate consumer segments do not differ greatly from those used to service the tractor-buying consumer. Here’s why:
• There are customers who, having done their homework on the Internet, wish to complete their transaction using great tools (provided by the brokerage) and a “life guard” level of coaching.
• Other customers, having demonstrated their contemporary nature by surfing the Internet, wish to avail themselves of the total real estate brokerage experience.
• The remainder of customers will fall into a mid experience segment that lies somewhere between the first two.
The American real estate industry is in the midst of developing a new persona, a new character, and a new customer interface. It is an exciting movement that builds upon the changing face of today’s agent population and the evolved nature, personality and demands of the contemporary real estate consumer. It is focused upon creating a superior value proposition through the provision of a superb lifelong customer experience.
Those firms that have adopted the concepts early are finding that increased profits are providing more than enough resources to satisfy investor requirements, profitability targets and the economic needs of sales associates. Success in today’s marketplace is just two steps to the right.
