(This is Part II of a two-part article. Part I was published in issue 65 of Inmobiliare Magazine, and can be consulted at www.inmobiliare.com)
FROM THE EDITOR
As Len Silverfine pointed out in Part I of this article, the marketer choosing the right approach may be likened to an expert skier at the top of a difficult piste. The experienced marketer quickly sur- veys the terrain, instinctively sees a line of attack, then commits, knowing full well that there will be bumps along the way; but is confident of being able to adjust without losing balance, because he/she has done this many times before, has developed an instinctive feel for “a good line”, and is prepared to react and adjust to whatever may come.
To face the marketing challenge, Len Silverfine shows us the line of attack he believes we need to take in order to descend faster, safer, at less cost, and with greater success. In Part I, Silver- fine gave us the overview from 10,000 meters, discussing the Philosophy of marketing and the importance of leverage; the Core Market, the “vital few” key to success; the Big Idea, which has to be both meaningful and proprietary to appeal to the customer; and the Marketing Process, that minimizes risk and offers the best chance of success.
Now, Len Silverfine takes us down an order of magnitude to 1,000 meters to define the picture more clearly.
In answering these critical questions the operative phrase is: “seeing the experience through the eyes of your customers.”
Doing so is not a “stand-alone” one-time event, or even a series of events. Seeing the experience through the eyes of your customers requires an evolutionary dialog with individual customers and prospects over a period of time of their choosing. This requires a “learning curve” of years, not at all particularly convenient for the marketer; and being able to archive and access this intelligence in ways that can “inform” and “enable” strategic decisions as required.
Further, while for convenience we have identified these “critical questions” individually, in reality they are intertwined. Consumer interest in the “Offering” is largely determined by how they see the fairness of the “Pricing”, which is materially effected by the power of the “Big Idea”, which is enhanced by “Branding” and given meaning through “Messaging”. Modify any one component and it will affect the others.
Practical considerations place limits on testing. Time pressure and budget limitations Benin the biggest factors. Given these realities, it is important to maintain a disciplined approach. Compromising for expediency on a crucial factor (e.g. “the big idea”) and coming up short could doom the entire project, while compromising on a particular aspect within the project and misjudging would be painful but not fatal.
My first work experience was with Procter & Gamble, a fortuitous occurrence because they wrote the book on sound marketing process. One of their core principles was to require that the decision-making process be carefully laid out on paper, beginning with “What are we trying to accomplish?” “How should we go about it?” all supported in turn with argument, and reduced to the fewest words required to make the case. Over the years this discipline has repeatedly proved its value to me (though I confess to forgoing my habit for brevity in my articles, because I want to be sure that my thoughts are not lost in translation).
Here are the key process steps that I go through…
Also known as “Unique Selling Proposition” (“U.S.P.”), or the “Position”, the “Niche”, etc., in essence refers to the product’s meaningful point-of-differentiation in the marketplace, i.e. what it can “own” because it has a product advantage, or it is the first to make the claim and support the claim in fact.
Usually, there are several competing ideas within an organization, each with its own champions. Remember, the only people that get to vote in this election are the customers. So, narrow the field down to 2 – 4 (at the most) propositions. Express each in its simplest and most direct form, with attendant support. Then put the choices into concept presentations for “testing”. Ideally, the concepts should be subjected to qualitative testing (focus groups) and quantitative measurement (standard questionnaires or surveys), among as many representative targets as can be identified, and over as much time as necessity will allow.
A combination of testing techniques is recommended because it is the safest way to remove risk, which is all that can reasonably be expected from “testing” at this stage. Quantitative testing generally indicates preference among respondents, while qualitative testing is valued for uncovering unanticipated negatives, as well as revealing interesting new insights and approaches. Nothing short of actual market experience is definitive, however. (Note: I recognize that many developers simply do not have the budget or the time to follow this process without compromise. Try as much as possible to take the reasoning into account in your compromises so that you maintain the integrity of the research proposition.)
Once you fix upon the “big idea”, it needs to be developed with as much flesh and substance as is possible, paying particular attention to how the potential customer will see the experience, and how you can improve its proprietary claim / competitive advantage. Again, this development must be evidenced in fact and reinforced over and over. Which means that the “big idea” once agreed upon may indicate significant re-designing and re-ordering of development plans. For example, fleshing out the concept could have implications for everything from the layout of residential development, to architectural and interior design, to the choice of amenities and experiences and how they are emphasized, to how the surrounding community is integrated into the experience, etc. It could also impact on Branding. And, it could influence your approach to strategic partners and allies.
This is more likely a combination of specific offerings designed to create trial and encourage repeat purchase, and begin the principal businesses of the resort.
#1 on the offer list is to appeal to your most likely first target. It is important to understand that this appeal in particular must err on the side of caution, i.e. it must make the offer very attractive, because it must attract as many people as possible so that you can deliver an experience that will exceed their expectations, which can then be leveraged to bring in others, shortening the amount time required to establish a viable base of customers. This may require trying out more than one offer before fixing on the best choice. Pre-testing can yield the validation and guidance needed, which is one more reason to set up the intelligence platform I have been referring to. There is simply no other way to record, filter, integrate and play back as needed the amount of data to be processed, and the need for this data to be delivered in useful form to the responsible people within your company.
Bear in mind that if your offering includes the purchase of resort real estate this is a “considered purchase” that usually occurs after years of repeat visitation. At a large multiresort company I worked at some years ago, we found that real estate buyers had been visiting the resort for an average of 7 years prior to their purchase. My feeling is that this “sales cycle” is somewhat less today, and can be shortened further with proper marketing approach, but be prudent in your planning.
Where I see the industry going.
- Shared-ownership will continue to grow in importance, but the growth will be led by innovations and variations in the existing models, which have weaknesses no longer tolerable in the market we are now facing.
- Stand-alone projects, except in rare circumstances, will succumb to larger “mixeduse” developments because of several inherent advantages of the latter, not the least of which is securing construction financing, as well as offering more options to the customer as their lifestyle needs evolve over time.
- These trends increase the importance of having strong, sophisticated marketing service resources capable of understanding the variety of customer needs, and designing offerings that accommodate evolving needs.
The Price of any proposition is integral to its evaluation. “Would you be interested in…” always begs the question at What Price?
Test respondents will generally undervalue the offer (for the simple reason that they are being asked to imagine something generally expressed in the superlative, for which they will have some skepticism), so getting the answer to “Pricing” means approximating the range of acceptability for a given offer. This is one reason why a combination of focus group testing, which allows for embellishment of the offer, and surveying, which limits embellishment but can be more specific in response, would be a good idea.
There are several strategies for choosing a brand. One increasingly popular solution is to bring in a strong established partner, a “flag” if you will. The flag could be a co-developer of the entire resort, or an initial portion of the development, or an operator of the hotel (and residences, or the principal attraction, e.g. the golf course). In any of these cases, the flag or flags would have the job of providing credibility to the offerings.
Whatever your choice in this regard you need to ensure the choice contains no significant “negatives”; secondly, to make sure that it possesses strong “positives” in support of the “big idea”.
“Messaging” is a particular passion of mine. Nowhere in marketing is it more important then in resort development. When you get down to it, we are purveyors of a “dream”. We package up an assortment of experiences, create a beautiful story around them and then tell the story to prospective buyers in such a way that they see themselves and their family idyllically within the story. The better we make the story, and the better we tell it, the easier prospects will be convinced, the more likely they will buy and the higher the price they will be willing to pay.
So, to my mind marketing in its best form is not unlike a philharmonic symphony, in which everyone at the company involved in touching the customer is a part of the composition (the “story making”) and the orchestra (the “storytelling”). The marketer plays the role of the conductor, orchestrating the impact of all the music, turning it into a magical symphonic experience.
The message needs to be particularly ontarget and compelling for it to surmount the inevitable challenges facing any project. The marketer needs to be especially attentive to “messaging” and its nuanced reaction among targets in the testing process to hope to achieve goals. And, he or she must recognized that this can only be accomplished over time with persistent support of experience, and with the help of early converts assisting in subsequent customer conversions. (This often under-valued part of the process, “third-party accreditation”, is a must-have component to leverage.)
STEPS TO GETTING
IDENTIFY “INSIDERS” / “INNER CORE” This first group, which we will call the “Inner Core”, is by necessity the group that is easiest to access, because your company (and its associates) already has a connection. Thus, this group is likely to respond in good fashion and more readily contribute information. Also, where there is a connection the quality of engagement can be expected to be higher than traditional research methodology where there is little or no connection.
“Insiders” will expect and should receive recognition and privileges for their contribution as the process develops to fruition.
ENGAGE / DIALOG
Each “insider” should be welcomed into your program with some information or action that represents value – e.g. an invite to an event or reception, interesting news, an opportunity to learn, etc., along with a few short questions (“Are you interested in finding out more about ___?” “Are you a golfer? Boater?” “Do you currently own a vacation home?” etc.) The idea is to establish a sort of value exchange, where you give information or privilege of value to the participant in exchange for information of value to the company. This in turn enables the company to provide more customized information of value in return for even more value, and so on. Bear in mind that communication must never become a burden, but rather something that the participant looks forward to receiving.
At what point does the participant no longer qualify as an “insider”? NEVER! Just as in elite frequent flyer programs, where there are gradations of privilege, but always a sense of belonging to a privileged group, and a built in desire to climb the ladder of privileged relationship.
ESTABLISHED KNOWLEDGE BASE
All of this effort is for naught unless there is a core structure that enables you to learn and see the experience through the eyes of your customers. Knowing its customers is the most critical intelligence a company can have. The better it understands what its customers like, what they do not like, and what they would like, the less likely the company will be to fail or to make an expensive error; and the greater will be its opportunity for success. Your company’s knowledge base is fundamental infrastructure, one of the best investments it can make.
Most CRM’s and database products do not do a good enough job from a broad marketing perspective. Accessing data in convenient, usable form is not optimized. Programs tend to be designed to meet the specific needs of one department of the company (e.g. Sales or Operations), but are not very useful to others. They lack integration, precisely because most companies do not take a global, integrated view of marketing in which all elements of the company that touch the customer play an important role in making and telling a magical symphonic story!
The dBase program or “intelligence platform” should be designed to conform to the company’s marketing plan, empowering management with the intelligence it must have to make timely decisions.
CONTINUALLY EVALUATE, INCORPORATE, ADAPT, REFINE & IMPROVE
Over the course of our careers we have all sat in meetings where critical decisions were required, and conclusive data upon which to decide was absent. Usually in these cases the strongest voice in the room decides. The difference between well-run companies (like P&G) and the general mass is that at a well-run company the decision would be made on available knowledge and judgment, because it had to be made, AND the necessary study would be insisted upon so that 6 months down the road, the same people will not be in the same room faced with the same question without better intelligence.
EXPAND INSIDER CIRCLE
Approaching your intelligence needs should not be a research-driven approach, but a marketing approach. By this I mean your company is fundamentally seeking to win over customers. To do so it must engage in a dialog with the most likely prospects, tell them what its vision is. In the course of this dialog you will learn, enabling you to evaluate, incorporate, adapt, refine & improve. This in turn will make your product more and more of interest to these prospects, and to others among their networks of friends, who they will be increasingly likely to involve, and of course encouraged to do so. A marketingdriven approach to intelligence focuses directly on leveraging relationships, particularly those identified as “The Vital Few”(1), to win over even more relationships. I refer to this practice as Core-Centric Marketing®.
Your company’s vision for its resort must be very clearly defined and constantly reinforced. Ideally, there should be no “disconnects” between the vision and reality, as disconnects can cloud the vision and put in question its authenticity. This too should be an important part of the company’s intelligence program. It must be able to see “disconnects” (from the point-of-view of its customers) and address them quickly.
I am of the view that doing what is expected in marketing is never good enough! Marketing is always evolving and improving (like an armaments race). The resort development world has become more challenging. If your company is to hope to achieve its objectives it must look at itself in the mirror and ask: “Do we have a winning strategy? Are we establishing the culture necessary to over-come our challenges and win against unfavorable odds? What more should we be doing? Are we leading or are we following in the path of others, and thus limiting our potential?”
Again, regardless of a company’s business, there is only one group that gets to vote…the customer. And the area of every company that is charged with getting this vote is Marketing. As such marketing transcends and overlaps all others. This is why it is important to establish a company culture where everyone understands that they are “in marketing”, whether they are architects, designers, lawyers, etc., and takes pride in their contribution toward winning the customer’s vote.
INVOLVE OTHER “PUBLICS”
In addition to its “Employees” and its “Customers”, companies have other publics that are absolutely necessary to fulfill a successful marketing strategy, and these publics must be won over as well – “The Public / Community”, “Business Community”, “Local & National Government”, “Investors”, “Suppliers”.
Winning them over is important because each plays a critical role in delivering superior experience to the customer. And winning each group requires the same steps that are required for any conversion: identification of the most important influencers in the group, engaging them in dialog, learning from them, applying those lessons to win over the group, then leveraging early converts to support the next circle, and so on.
SUPERIOR EXPERIENCE DELIVERY
Marketing is the business of selling products by satisfying and exceeding the customer’s desire for special experience. This means…
Unsatisfactory experiences have to be eliminated, and turned into positive experiences.
- Experiences that just meet expectations may not cause any harm, but neither do they do any good, so they should be considered a lost opportunity to exceed expectations.
- Exceeding expectations should be where the measuring bar is set, and wildly exceeding expectations should be the goal, as this causes “good stories to be told at cocktail parties”. Effecting superior experience delivery requires a “Touch Point Management” program incorporating a staff incentive program. Without such tools management doesn’t find out about problems until damage has been done, and it has little ability to recognize, encourage and reward best practices. TPM programs are available through many providers. However, most are treated as Operations programs, and are not integrated into the overall marketing of the company. The most effective TPM program is one that is integral with the company’s overall intelligence platform.
PROCESS & TOOLS
As you can see from the previous pages, marketing has a lot of things to take into account, integrate and manage to fulfill its function. Most companies, to the degree that they may understand this, find it easier to just order up a study, a survey, or focus group or two and follow what others appear to do in their marketing. After all if so-and-so does it this way, and they are successful, why shouldn’t I expect to be by following what they do?
Well, copying something that appears to have worked does not ensure success, and it generally doesn’t produce exceptional results. Market conditions evolve and become more problematic. Locations differ, timing differs, markets differ, etc. Then too, and you’ve heard me say this before: The developer who made $20.0 million 3 4 years ago was ecstatic. What he may not have realized is that had he practiced more intelligent marketing he would have made $40.0 million. He didn’t make $20.0; he lost $20.0 million! However, in his ignorance he had no way of knowing that, so it didn’t matter. The market that you face now is likely not to be as forgiving. Conditions are much more difficult. Smart developers are not resting on past successes. They are re-tooling, and nowhere more so than in marketing. For a company not to be innovating in its marketing may mean the difference between some profits versus a big loss. Given marketing’s complexity and nuance to be intelligent and effective in its marketing a company must establish a clear marketingdriven process and incorporate the best tools TI can to manage this process.
If you wish to discuss any aspect of this article, contribute feedback, or have questions, please let email me at email@example.com. Thank you.
(1) See “MAYBE A RUSSIAN MATHEMATICIAN AND AN ITALIAN ECONOMIST CAN TEACH US HOW TO BETTER DEFINE OUR MARKET©”, INMOBILARE ́S ISSUE 64.