INSIGHT

Market Intelligence: What You Don’t Know Can Hurt You

April 26, 2022
Chris Coates

Understanding what’s influencing real estate buyers can mean the difference between inventory that moves fast and product that sits on the market for longer than necessary. Today’s high demand means builders don’t have a problem selling new homes—but this boom won’t last forever.

We talked to Christopher Coates, Director of Market Research at The Advantage Group, to learn more about what home builders may be overlooking.

Q: When it comes to market intelligence, where should builders begin?

A: Target markets are the cornerstone of marketing for home builders. Understanding who your ideal buyer is and what matters to them is extremely important. This influences everything from your messaging to which platforms you use to you connect with buyers to amenities, layouts, and elevations.

Q: What are some of the main differences between buyer profiles?

A: Age delivers huge insight into how to connect with your target audience. Younger buyers are on digital platforms like Instagram, Facebook, and Tiktok. They’re savvy to marketing and want to see fun, frequent video content that highlights the new home features that support the aspirational lifestyle. Older buyers are more responsive to traditional marketing campaigns— things like banners, newspaper ads, and radio advertising.

Q: How can home builders discover demographic information about buyers?

A: Lots of information is part of the public record, so it’s a matter of digging into those records. Census data, school enrollment information, and newspaper articles are good ways to discover how areas are changing.

Q: Does demographic information influence any other choices home builders make?

For home builders, demographic information has importance beyond just marketing. Knowing the profiles of who will be buying homes in a certain area enables builders to incorporate popular design features like single-level floorplans for older buyers or multi-purpose spaces for families with children learning from home.

During the very early stages of design, many of our home builder clients come to us for insight into the layouts, amenities, and materials that are most popular with their target market. Keeping the final sale in mind early on lets home builders incorporate in-demand features from the start.

Q: What should home builders keep in mind about the market as a whole?

A: They need to understand their position in the marketplace and the buyer’s mind. Home builders like Lennar have an “everything’s included (EI)” approach that really connects with their target market and positions them differently from home builders that offer additional options with associated price bumps.

Home builders also need to understand the role they play in their target market’s buyer experience. Luxury home builders might focus on the customizability that resonates with higher-end buyers. Other home builders may choose to focus on affordability, especially if that’s the type of product missing in the area.

Q: What are some opportunities builders tend to overlook?

A:  Busy home builders may not have the time to head into the field to see what the guy on the other side of town is doing. This is where working with dedicated market research teams like The Advantage Group can make a huge difference. We’re out there every day, throughout northern and central California and parts of Nevada, pounding the pavement to see what else is going on in the area and what’s trending for the future.

We tour model homes and talk to developers and sales teams. When you get to see a lot of product, you see what’s successful and what fails to attract buyer interest. Talking to sales teams and developing personal relationships with them helps, too. Many sales teams are upfront about their pricing structure and where they’re successful in terms of the types of amenities offered.

Simply taking the time to aggregate this information and then interpret it can provide a much bigger—and clearer—picture of where a home builder should focus and where they can avoid wasting time and money.

Q: What marketing mistakes do you see home builders make?

A: Not recognizing how emotional the buying process is. We are extremely data-driven at The Advantage Group, but we also know that buying a home is an emotional road. Buyers are purchasing more than a home—they’re buying into a lifestyle. Each site is so uniquely different in terms of location, lot size, product type, features, neighborhood, and accessibility to things like shops, schools, and restaurants. All those things influence what is special about each community and need to be communicated to buyers.

Working with an experienced marketing team helps home builders surface what’s unique and exciting about their communities and start to shape that into a narrative that connects with buyers on an emotional level. We help home builders sharpen their message about what’s different about their communities to communicate the story behind the development.

Q: What can home builders do differently to improve their marketing processes?

A: Start taking advantage of technology. Technology has transformed so many aspects of marketing for home builders. Everything from drone footage to show buyers the progress of their community to connecting geographically dispersed teams through Zoom calls to being able to screen share reports or do a live video when walking through a new home. These technologies help every member of the development, marketing, and sales teams avoid miscommunications and get up to speed faster.

Additionally, home builders who haven’t done so already should start a conversation with real estate sales and marketing consultants like The Advantage Group. This is what we do all day, every day. Not only are we paying attention to what’s happening right now and what’s just over the horizon, we have decades of experience fine-tuning tactics to gather accurate market intelligence quickly. Partnering with sales and marketing experts is an extremely effective way for home builders to start connecting with the right buyers right away.

At the end of the day, it’s about generating as much useful information as possible. Whether home builders do it in-house or partner with an outside real estate sales and market intelligence team, what matters is getting the best information and putting it to good use.

Ready to access a deeper level of market intelligence? Contact our team of real estate marketing experts today.

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