Just a brief note from the Leading RE Show going on right now in Scottsdale, AZ.
I got to sit in on a great session earlier today with a speaker who I gather was a luxury marketing consultant. He actually had some great points to make and great things to say.
However, a theme he sounded throughout the session grated with me. It goes something like this:
Companies should invest heavily in CRM, and segment their clients to identify their “best customers” and then cater to them in order to drive customer satisfaction, which drives referrals, new business, and loyalty.
Now I happen to agree with the general thrust here. I’ve already written that I think CRM is the killer app for real estate, and that real estate companies need to do a better job with segmentation and targeted marketing.
But applying principles of luxury marketing from the worlds of hospitality and retail and whatever else to real estate doesn’t readily jive with me. Because of the Seven Year Cycle.
I just think it’s borderline irresponsible for marketers to talk about CRM or whatever without addressing this fundamental fact about real estate: consumers go seven years in between transactions on average.
I don’t know if that frequency changes with luxury buyers — maybe they can and do buy the $20m estate in Beverly Hills, then buy a $10m condo in NYC, and then a $15m villa in Lake Como, Italy. So it makes sense to treat them as one might treat any luxury buyer of luxury consumer goods.
But if that isn’t the case, and even luxury buyers don’t go dropping $20m plus on a house every other year… then any discussion of CRM has to take this fundamental cycle into account.
That real estate is unique, and the practice of real estate marketing is as a result unique as well, are things I’m learning and relearning every day. Absolutely non-commoditizable product (real estate) married to hugely commoditized service (brokerage services) with a seven year cycle and independent contractors operating in a significantly regulated industry constitute a truly unique set of factors and challenges for the marketer.
Yes, there are lessons to be learned from other industries. There are best practices that can and should be adopted. But adoption requires adaptation to the unique fundamentals of this industry.
Call it a pet peeve, but it sure would be nice if more consultants and speakers and panelists considered not only what is similar between real estate and other industries, but also what is unique and different.