Q.
b) Explain the strategies used to introduce new property products into the market. (10 marks)
(10 marks, 2014 Q3b)
A.
In the light of today's technology, the strategies employed for launch a property product is probably double or triple of what was deployed in the industry 20 years ago.
i) Classical strategies:
Promotional Strategies:
- Advertisement in the print media - newspaper and magazines.
- Celebrity endorsement, or politician endorsement.
Pricing Strategies:
- Price rebate during Pre-launch, eg. Special launch discounts.
- Bundle/bulk sale or freebies with partial furnishing.
- Stamp Duty and Legal Fee paid by developer.
Distribution Strategies:
- Salesman commissions/brokerage incentive.
- Own team of agents.
ii) Newer Strategies:
- Advertisement through social media - Facebook, etc.
- Online property portals - iProperty, Propertyguru, PropertyInsight.
- Email blast! Group email to existing and potential customers.
- Phone calls, SMS (Short Messages), WhatsApp, WeChat, etc.
- Roadshows at banks, shopping malls, property tourism.
- CRM - Customer Relationship Management. See earlier post on Strategic CRM for Customer Satisfaction.
Pricing Strategies:
- DIBS - Developer Interest Bearing Scheme, where developer absorbs the interest until the property is ready. This is no more allowed for curbing speculative buying.
- Developer working with buyers to lease back for rental, service suites, commercial properties to obtain better rental yield.
- As DIBS is now prohibited (2014 onwards), some developers come out with schemes that reimburse buyers the amount of interest every month. The concept is like reimbursement of car loan interest by employer subsidy. However, it is not DIBS where there is no need of loan installment during the entire period during which the project is under construction until completion. In this context, the buyers still service the bank loan, as progressive payment would start demanding loan installment during construction.
Ref:
Own account.