The right moves: How to market a property?
Recently I was asked for advice by family and friends who were selling some commercial and residential properties.
They had done the right thing by inviting a selection of agents to inspect the properties and make written submissions setting out their opinion on the value, the suggested method of sale, their marketing plan and fees. All of the submissions were of a good standard. Fee quotations were very similar, there were some interesting variations on value, but what surprised me most was that none of the submissions recommended spending money on newspaper advertising. So what's going on?
A combination of factors have led to this situation. Firstly, there is the assertion that "everything's online- there's no need to be spending money on newspaper advertising." This is completely flawed-especially in the commercial sector, where there aren't the dominant two or three portals carrying much of the market. Many viewers, myself included, far prefer to turn the pages of a newspaper, rather than squinting at photos on a phone. Indeed, agents themselves, who are at the heart of putting buyers and sellers together, are not trawling through all of their competitors sites every day, to see what properties are new to the market. They are, however, reading the property supplements.
So an online only marketing campaign is not doing what it is supposed to do, which is to expose the property to as many potential purchasers as possible. More enquirers means more viewers. More viewers means more bids. More bids means getting the highest possible price.
Not only that, but the cost of including newspaper advertising in a sales campaign is relatively small. Just think about it: you're selling an office unit, or warehouse, or your home, and it's worth about €500,000.
For a tiny percentage of that, you could have a decent advertisement, with a photograph, in three national newspapers. The advertising cost is tax deductible or if you're a residential investor taking a profit, the costs can be offset against capital gains tax. You wouldn't restrict yourself to a half-hearted marketing campaign in your business, so why do it with one of your most valuable assets?
I have no doubt that the recession has played a big part in this drift into an over-reliance on the web. Agents were operating in "survival mode" for several years and the vendors of many of the properties being sold were also under financial pressure. The last thing that vendor needed to hear was that the agent was looking for advertising funds in advance, and the agents were (rightly) avoiding carrying the cost, with the risk of not being repaid. Therefore, it was easy to slip into a mode of relying on online marketing only.
I suspect that some agents are still afraid that recommending expenditure on newspaper advertising will reduce their chances of winning the pitch for the instructions.
However, the market has changed, and in my view, and recent experience, agents who limit marketing to online, are doing their clients a disservice. They are also missing out on promoting their own brand.
At the risk of ruffling feathers, an online only campaign also reduces the amount of work to be done by the agent. There's a layer of extra work to be done in designing an advertisement, dealing with the newspapers and handling the money. If lots of competitors are doing the same thing, then an industry will quickly settle at a new level.
It's interesting to look at how the internet has affected other sectors. Online retailing was predicted to herald the end for many retailers, and it has had a big effect. Now, however, online retailers are beginning to open physical shops and traditional retailers are building their online activity. Just as electronic readers spelled the end for printed books, the growth of e-readers has peaked and printed book sales are increasing again. Travel agents, who were to be wiped out, are having a boom year in Ireland, as customers return for the personal service that the internet can't provide.
The answer, of course, is that all markets will find their balance and the property market is finding its level. The very best marketing campaign for your property will be a blend of online and newspaper advertising, a good signboard, press releases and an agent prepared to work through their enquiry list. Anyone telling you that marketing is "all online" has their head in the sand.