Tuesday, February 1, 2011

Selling? Ask for your Marketing Blueprint----

I was talking to a seller-client recently after forwarding her a typical "pricing memo." The memo covered a number of topics all related to value, but her reaction was "when we moved from the City, we didn't get nearly this level of detail and insight on the market, how our home fits into it, and pricing for our home!"

My memos probably are about the best in the local market, but I'm frankly most surprised by information the typical Piedmont agent offers regarding marketing a home they are in competition to sell (as opposed to pricing it).

Fundamentally, most agents or brokers take a "trust me" approach--"here are samples of my past work (flip, flip, flip through a presentation binder); if you sign my listing agreement, I'll do the same for you. I can't really answer too many questions right now because I'm not yet hired to do the job, so haven't spent much time thinking about your situation. And I won't--not until I have the signed listing agreement."

If you've ever worked for an ad agency (as I have) or if you've ever watched an episode of Mad Men, for that matter, you know that's not how advertising agencies get the "deal."

The "creatives" slave away deep into the night trying to clearly understand the product; they come up with concepts, and cast them off, finally settling on the "ah-HA" marketing effort. The pieces all fall into place and the client says "yes, you understand the essence of our product."

And while the ad guys probably won't have a sample ad that's perfect and ready to go to the media buyers, they have enough of a gameplan to let the corporate decisionmaker know with whom he'd like to place his sizeable marketing budget for the next several years (we're still with Mad Men here).

And make no mistake--when you go to sell your million-dollar home, you're putting $50,000 to $60,000 in the hands of your agent for, fundamentally, marketing.* Half will go to the buyer's agent for responding to the marketing and bringing your buyer, and a bit less than a quarter will go to the brokerage to provide back-office support (much of it marketing-related), and a small amount will go to E&O insurance, and to cover time spent in negotiations and while in escrow. But the vast majority of what you're paying for is the marketing of your home--the framing of your home within its market, the marketing ideas themselves, and then their implementation.

I think it's fine for agents to say "trust me" on implementation--the ads, postcards, brochures, e-newsletters, broker open houses, Sunday open houses and so on, assuming they have a good reputation on these fronts. And of course many agents don't realize that real estate is, in fact, not a one-size-fits-all business. (They were taught that marketing a home involves nine nice photos, a bullet list of features (*3 bedrooms *two baths *2100 sf *Lush landscaping *Rich details) and a paycheck.)

But it's what I call the Marketing Blueprint for a home that actually sells it. The blueprint gets inside the head of the buyers for your home, and then feeds them the details they need to make an offer on your home.

So if it's a "fixer" and buyers may be uncertain about how big a job it is, I have suggested a Renovator's Open House (with vendors who can give your buyers the information they need up front). The San Francisco Chronicle thought that was such a cool idea that they wrote a cover story on me in 2007.

If it's a mid-century modern home, I bring my library of mid-century modern books to the open houses, I place the home in the mid-century pantheon, and I've even added a Google Earth shot from above to emphasize the boomerang shape of the home for buyers.

If it's an historically important home in Piedmont, I've had a Piedmont historian at the open house telling stories about how the home fits into the neighborhood and how life was "back in the day."

If it's a great value for the money, there will be plenty of detailed information outlining that fact for value-sensitive buyers.

And so on.

Developing that Marketing Blueprint takes some time, expertise, good punctuation, and risk. I can pull together a fabulous Marketing Blueprint for your home, but if your brother is a real estate agent in Alameda, I may not convince you to hire me (and I'd hope that you wouldn't pass all my hard work on to your brother, but I completely understand the temptation).

Of course the strategy comes into better focus and the missing pieces (OK--how old exactly is that roof?) get filled in once we sign the deal and get seriously working. Nevertheless, I feel sellers deserve to know my gameplan--how I plan to market what's likely their biggest asset--before they hire me.

The Marketing Blueprint is the rough equivalent of the specs you expect from a contractor giving you a bid for a new kitchen, or the roofer giving you a bid for a new roof. You'd never accept "trust me" from those vendors; why would you say "yes, I trust you; just go and sell my house" from a real estate agent?

Instead, you should expect each to say, "this is how I suggest you position your home; this is how I would propose to do so; this is what I am planning to do; and this is what I anticipate you will net."

When you go to sell, expect each of the three agents (or better yet, brokers) you interview to give you a Marketing Blueprint. Your house is unique; doesn't it deserve a unique Marketing Blueprint?

*$100,000 to $120,000 for a $2 million home......

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