Andrew Wetzel's Musings

May 27, 2017

The “4-Ps” of Marketing Real Estate

Filed under: Uncategorized — awetzel @ 5:19 PM

Real Estate, even if well-priced, will NOT sell itself.  As a Realtor I consider myself a “marketer” rather than a salesperson.  Buyers are much more likely to find or have my property listing information presented to them than I am to present it to them (who knows where the buyer for your house lives right now?).  In fact, with all due respect, the term salesperson has negative connotations.  I am a “conduit” or a bridge between my clients and the Real Estate market place.

When I started in Real Estate in 1996 I began to formulate how I would present my ideas to potential clients and I developed one that, at least to me, makes all the sense in the world and yet, I have rarely had a potential client know what I was referring to when I called my marketing concept by the name it was taught to me.

Back in the day I needed to take a basic marketing course (I think it was called Marketing 101.  Go figure!) before I could start taking MBA classes.  That course was phenomenal and taught me a concept that is enduring.  It is called the “4 P’s of Marketing“.  Apparently the course was abandoned after I took it and everyone who ever took it forgot the concept.  Oh well!

The basis of the concept is this:  anything that is made available for sale has 4 aspects to the process and your success depends on understanding and implementing them as part of an overall marketing plan.  Here is how I describe the “4 P’s” to my prospective Real Estate clients.

PRODUCT:   in order to sell anything, you need to know what it is.  Obviously in my case it is a piece of Real Estate, generally residential.  The “product” has two intrinsic aspects called features and condition.  Sellers need to know how their “product” compares to other “choices” a prospective buyer has and they need to decide whether they are selling the “product” “as-is” or will make repairs or upgrades.  Some sellers over-value what they have (sellers see memories while buyers see “utility”).  Part of this is expecting a higher “return” on improvements.  Buyers may want to consider the differential cost of buying something decorated to the seller’s taste as compared to a house that can or needs to be tailored to their wishes. 

PLACEMENT:  this is the “location” (remember, it HAS to be a “P”).  This is very important:  it relates to schools, property taxes, insurance and a variety of other “environmental”/ lifestyle factors.  As an example, I live and work primarily in Delaware County PA.  There are many examples of municipalities that literally sit across the street from each other.  Two essentially identical houses can vary in “market value” by tens of thousands of dollars depending solely upon which side of the street they sit on.  If you do not care about the property taxes or the school district, you can save a lot of money by buying on one side.  This example clearly shows the “cost” of living in different areas.  Bottom line:  you cannot change this so do not worry about it!  Buyers may want to consider this as far as possible “appreciation”.

PROMOTION:  We are in the Internet Age and we are dealing with “Internet Empowered Consumers” (IECs).  The “gatekeeper model” is DEAD:  over 90% of consumers shop for Real Estate online.  If they cannot find your property listing, they may not know that it even exists.  Slow or non-existent traffic can kill your prospects for a sale and cost you money.  What is the typical reaction to a slow moving property?  PRICE REDUCTION!  Sadly, I have seen many Real Estate listings have their value eroded when “marketing” and not pricing was the problem.  If you are on a well-traveled street a sign may offset some of the damage.  The key point here is that, for many listings, the Internet is how consumers will first “see” it (this is like your “first showing” but without the inconvenience) and decide whether to look inside.  I have written a number of Blogs on how important something as seemingly simple as “data entry” is to a seller’s success.  Proper “promotion” may even create a little competition!  Buyers need to consider whether they really understand how to “find” the property listings with “data entry” issues.  An experienced Realtor should know some tricks!

PRICE:  In theory, this is the #1 factor in determining how successful you will be and this is a mixed blessing:  you control it BUT if anything else works against you (ineffective promotion, product issues or location challenges), it can be very costly.  Again, even a price reduction may not work if people do not know your house or property is “For Sale”.  The good news is that EVERY property has a price at which it will sell!  Whether that works for the seller or withstands a lender’s appraisal is another matter.  Buyers need to consider that many houses still have competition and will achieve the “asking price” or higher so they need to know that they may not get a second bite of the apple when making an offer.

I believe that understanding and embracing this concept (the “4 P’s“) and these 4 aspects will help you sell your house.

Of course, it all starts with HIRING WISELY!

Thank you for reading.

 

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