Home marketers can learn from auto dealers.
In our post about the real estate distribution system as flea market we had some fun describing how many ways they were similar. We could have just as easily compared the real estate market to a used car lot.
Think about the experience of buying a used car.
You can buy one from a private party, a used car lot, a new car dealership or, increasingly, on-line through sites like eBay. Like the home buying experience or a flea market, you have lots of options and there are lots of risks that things that you can’t see may leave you with a lemon.
A perfectly fine looking car could have been wrecked, neglected or been through a flood. If you were marketing used cars you would be trying to maximize value and the price you can get by taking away as many as possible of those worries that all car buyers have.
We see this in numerous tactics for marketing cars.
Fairly common is prepping the product. This will include a thorough detailing to make the car look like new and even smell like new.
Also common is something like a “128 point inspection by our qualified mechanic,” who may be drunk Uncle Billy counting the wheels and the door hinges.
The point is to make the potential buyer feel better about a purchase and the more genuine the effort the more effective it is as a marketing strategy.
BMW raises the ante.
Several years ago BMW took this one step further and even changed some of the language in the industry. Instead of used cars, their new car dealers offered Certified Pre-Owned cars. Part of their strategy was to attract potential buyers into their showrooms who might not be ready to shell out big bucks for a new beemer by offering something that might compare price wise to a new Chevy or Ford but still carry the prestige and panache of a BMW.
By adding warranties to the certification they opened up beemer-hood to a whole new group and allowed them to establish a relationship that might lead to many more sales.
Many other dealers have picked up on the “Certified Pre-owned” idea.
In fact, on eBay Motors you can now limit your search for an automobile to “certified pre-owned” vehicles. Click through to Ebay and you can see what each company offers in their certified package.
Speaking of Ebay…
how do you feel about buying a car sight unseen from a dealership or owner hundreds of miles away?
Ebay Motors is my fantasy playground online so I’ve seen an evolution over the years in the approach taken by them and the automobile marketers that use the site to move iron. These days eBay Motors is much less a way for individuals to market their clunkers…that’s gone to Craigslist…to a place for dealers, many of whom market exclusively on eBay.
The most obvious thing is lots of pictures, sometimes dozens and dozens…the tire treads, under the hood, in the trunk, the keys, the door panels and on and on and on. If there is a blemish, they will photograph too.
The second and more recent thing is the availability of free Carfax reports right there with the listing. A few clicks and you’ll know if the car has ever been wrecked, if there were any obvious mileage rollbacks or commercial use. You’ll also see where the car lived its life because of where it was registered.
Finally, eBay encourages the delivery of a quality product through its feedback system. If a dealer’s feedback is bad, he cannot survive on eBay.
The marketing approach described here is product centric. That is, it focuses on competing by offering a better product that is supported and guaranteed. It’s not the only approach to marketing cars, but it’s a good one.
So, what does this have to do with real estate?
Lets focus on how the product centric automobile marketing strategy can be translated into a real estate marketing strategy. In the next post we’ll discuss what can be done to take some of the anxiety out of home buying by “certifying” your listings with a few readily available tools. You probably are already aware of them and have used them but have you given them the emphasis that BMW has? This is a product centric strategy for real estate but it also infuses the promotional strategy in the marketing mix for marketing homes as we will see.