IF ALL OUR “LITTLE BOXES” LOOK THE SAME, WHERE IS THE OPPORTUNITY FOR HOMEBUILDERS TO STAND OUT FROM THE COMPETITION AND SELL MORE HOMES?

There is a song, written by Malvina Reynolds in 1962 and made popular by Pete Seeger, that lampoons the development of suburbia and contains the opening lyrics:

Little boxes on the hillside,
Little boxes made of ticky tacky,

Little boxes on the hillside,
Little boxes all the same. 

There’s a green one and a pink one,
And a blue one and a yellow one,
And they’re all made out of ticky tacky
And they all look just the same.

Although the song was written as a parody of conformist values with which the composer and artist obviously found fault, I am not embracing that position nor attempting to rekindle the interest in folk music which thrived in the 50’s and 60’s.  Rather, I find this opening stanza valid for the homebuilding and residential development industries almost 50 years after it was first written, especially as we strive to satisfy the reemergence of the first time home buyer market.

Many of my blogs have addressed the concept of “USP”, creating a viable and readily visible superior differentiation from the competition that enables us to excite the customer and sell more homes.  Last week I again had the opportunity to instruct IRM Course II, “Marketing Strategies, Plans and Budgets”, which I believe is the most important of the four core courses.  I say that because in my opinion this program introduces and discusses the basic concepts of marketing for the homebuilding industry – strategy and tactics.

The class was diverse, including builders, sales people, sales managers and marketing directors from several geographic areas and I asked the students to identify what makes them different from every other builder building the same box in their marketplace.  Most of the class could not answer the question as they apparently did not believe they were really different.  And if the product they are trying to sell is not both different and better, how can it be sold?

One of the participants provided the best answer of the group, suggesting that they had superior levels of standard features by including such details as 10′ ceilings and higher windows.  But when asked how long it would take for every other builder to copy these features, the student withdrew the answer.  The fact of the matter is that neither home design nor included features is impregnable to competitive attack.  Continue reading

A SHORT SERMON FOR THE HOMEBUILDING INDUSTRY

The minister gave his Sunday morning service, as usual, but this particular Sunday, it was considerably longer than normal.

Later, at the door, shaking hands with parishioners as they moved out, one man said, “Your sermon, Pastor, was simply wonderful – so invigorating, inspiring and refreshing.”

The minister broke out in a big smile ready to thank the parishioner only to hear the man add, “Why I felt like a new man when I woke up!”

I write a lot about the importance of USP (“Unique Selling Proposition”) in the homebuilding industry but I do not believe that the message is getting through so I offer this week’s short sermon featuring the parable of the “guilty grandparents” in the hope of gaining further converts.

A few weeks ago we were I-chatting with our son’s family when our son turned to our 3½ year old grandson and said, “Tell Grandma and Grandpa what you wanted to tell them” and our grandson responded, “I miss you and want to see you.”     

Within fifteen minutes of ending the chat my wife got on her computer and began searching for airline reservations to Boston over her Spring break (she is a school teacher).  Unfortunately, as we had not planned this trip well in advance, and her Spring break corresponded with both Easter and Passover travel, the airfares were universally high until she hit the web site for Spirit Air which had convenient non-stop flights to Boston at less than half the price of any other carrier. 

Spirit Airlines

I had avoided flying Sprit ever since our son’s wedding five years ago when two of our guests never made it into town when their flight was first delayed, and then cancelled.  Spirit had no other planes available, and the airline refused to make any effort to accommodate them on another carrier.  So even with this less than wonderful perception of the carrier, and although I am not normally a “price” purchaser, the substantial savings won me over and I booked the flight.  After all, how bad could it be on a three hour non-stop flight?

If you have not flown Spirit ever or even recently, it is an experience as they have branded themselves as the “price leader” and have managed to regularly undercut every other carrier on their routes.  One of the ways that they have managed to do so, apparently at a profit, is to squeeze in more seats than I thought was physically possible.  Fortunately, my wife and I are short in stature so the flights were tolerable but I cannot imagine anyone over 5’8” being able to walk after a two hour or longer flight on that plane. 

They charge extra to check luggage, a common practice today in the airline industry, but offer a discount if you pre-pay at the time of reservation which I did.  They do not assign seats until 24 hours prior to departure unless you purchase a specific “premium” seat (all seats are premium for advance purchase ranging from $6.00 to $60.00).  I took my chances on the early morning outbound flight but as the evening return was booked full I purchased two seats.  And they charge for refreshments – starting at $3.00 for a canned soft drink or a bottle of water.  But even with the extra fees, including the luggage, seats and overpriced snacks, they were still less than half the price we could find anywhere else. 

Except for the inclement weather throughout the Northeast which was beyond their control and delayed our return by two hours, the flights were relatively painless and they served their purpose, I had saved over $500 and I will probably fly them again.  And I became a “price” buyer, at least for shorter flights.

Sale tag #7

The price position is almost always a viable USP in any industry, especially in challenging economic conditions, and homebuilding is certainly no exception.  In fact, there is a phrase I first used over twenty-five years ago in teaching the “A to Z” program and the early IRM courses that expresses this quite clearly – “Price Is The Ultimate Amenity!”  Continue reading