The goal of any good promoter or sales representative is to persuade the consumer to choose their product or service. In real estate, this means getting homeowners to list their property and to influence home buyers to shop at your “store.”
The purchase is just one component at the end of one sales cycle and the beginning of another. The consumer cycle begins with an awareness of a problem that needs a solution, such as a better school or a larger yard. The next step is researching options, acquiring the solution (or nicer home) and ultimately selling at some point in the future when their needs change.
Homeownership is the dream of the middle class but it is promotion that influences the consumer to act. By understanding how consumers attempt to satisfy their desire for a home, the agent can influence purchasing decisions. By developing a promotion plan based on consumer profiles, the salesperson can eliminate unnecessary guesswork and target a specific group.
As a side note, it’s surprising how many consumer decisions are affected by the personality or style of the sales representative. Ethics underpin the promotion of real estate and are, perhaps, the greatest asset the industry has for its own survival.
Some agents are anxious about using psychology in promotion because it can seem manipulative. When we discuss the psychological aspects of consumer behaviour, we’re really just talking about how to make the consumer feel more at ease with the process so they can make better decisions. A well-designed promotion campaign considers the motivations, perceptions, attitude formations, integration with an internal values system and overall satisfaction with the process.
Motivation and need recognition are connected by two concepts: an actual state and an ideal state. The gap between these form a goal in the consumer’s mind.
Usually, the ideal state is an improvement of circumstances or status. For housing, the consumer might be motivated by a need for “more” of something, usually living space. They may be dissatisfied with traffic noise or their commute time. Or they may be influenced by friends or family who have recently moved to a new development, which causes them to want something similar.
Promotion can tap into these ideas to create a need recognition. You may have seen signs on the highway that say, “If you lived here, you would be home by now.” That’s an example of creating the feeling of a need, or in this case, a shorter commute that means more family time. In hot markets, promotions may centre around a phenomenon known as novelty-seeking. This is an excitement wave that compels homeowners to change residences just to be part of the action. Any excuse to move is fair game in this scenario.
When designing a promotional campaign, it might be helpful to refer to Abraham Maslow’s hierarchy of needs. Maslow suggested that there are five basic levels of needs based on human priorities: physiological, safety, social, esteem and self actualization. The levels start with the things necessary to sustain life and ascend to the luxury of self-realization. How can you use these basic truths in the promotion of real estate?
Begin by defining your farm area and its demographics. If your farm area lacks a grocery store, promotional materials might advertise listings in areas that have lots of them. It seems like a simple idea but for people who live in the city without a car, a grocery store within walking distance can be a strong motivator. This type of promotion addresses physiological needs.
Safety and protection are the second tier of Maslow’s hierarchy. If your farm area is not well serviced, then advertising newer neighbourhoods may be productive. The goal is to help the consumer imagine the difference between the actual and the ideal state. Consider advertising the location of schools, public transit and police and fire services in the neighbourhood being promoted. These are trigger features that will appeal to a renter or potential buyer who is living in an area they don’t want to.
A sense of belonging and love are the next priorities. Some consumers want a neighbourhood where they feel included and involved. There are a number of examples where “birds of a feather” purchase homes. Active retirees may congregate in certain neighbourhoods or condo developments that represent a pragmatic decision. “Follow the girls” is a proven method of landing in an up-and-coming neighbourhood. As a last example, consider all the neighbourhoods in New York or Toronto that are called “little” versions of the home country. Newcomers may not know that these cultural centres exist, which is an opportunity to help them connect to their community through a home purchase.
Esteem purchases rank high in real estate statistics. Words like luxury, high-end and exclusive are the foundation of many campaigns. These properties, or more specifically, the campaigns for these properties, are intended to attract people who want to increase their status or recognition. The need for status can be found at all levels with messages aimed at aspirational buyers. Everyone has a desire to climb the property ladder, and no matter where they start, those first steps are much easier if there is status with the risk.
The highest level in Maslow’s hierarchy is self-actualization, which is to fully realize one’s potential. It comes through self-development and realization of oneself. Promoting to people who are self-actualized requires an understanding of how they reached that point in their lives. Consumers at this level are looking for a custom homeownership experience in an exceptional location that allows them to enjoy esteem, social belonging, safety and convenience all at the same time. Understanding the culture of self-actualized people opens the door to conversations about their real estate transaction.
Maslow’s hierarchy can be used as a framework for the property promoter in order to identify and create marketing messages that fit. It’s important to note that ascending through the theoretical levels is not linear. Most people achieve a slice of the pyramid with more or less of one level than another. If it were a perfect ascension, there would be no layoffs, divorces or illness.
A promoter should aim to broaden the base and reinforce the parts of the pyramid that need attention.
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