http://propertysoul.com/2013/10/09/t...launch-part-i/
Top five gimmicks of new launch (part I)
October 9, 2013
There are many tactics deployed by property developers and their marketing agents during the launch of off-plan properties. The five most commonly seen marketing gimmicks are:
1. Gather a crowd;
2. Create the urgency;
3. Make some noise;
4. Dangle the carrot; and
5. Promise good return.
Gimmick 1: Gather a crowd
When it comes to buying big ticket items like properties, no one wants to be a guinea pig. The traffic in the sales gallery is a thermometer to measure the popularity of a project. Seeing people turning up in droves can reassure potential buyers that they are most probably making the right choice.
It is therefore the job of the marketing agent to ensure the following at the sales gallery, at least during the first weekend of a new launch:
1. Fill up the temporary carpark to make it look full;
2. Draw a crowd of enthusiastic property agents waiting outside; and
3. Have a few groups of eager buyers occupying the discussion tables.
When a local developer launched a property in the east in mid-2011, instead of using the usual industry practice of balloting for the sequence to pick a flat, their marketing agent asked interested buyers to line up in front of the sales gallery.
On the day before the actual launch, close to three hundred people joined the queue.
There were students, retirees and property agents napping, snacking and playing cards in the queue to kill time. Such a scene made passers-by wonder whether the crowd was really consisted of genuine buyers, or just part-timers being paid to fake how hot the new project was.
By coincidence, it was the beginning of the school holiday in June. So was it the popularity of the project, or simply the attractiveness of the incentives?
Gimmick 2: Create the urgency
It is the marketing agent’s job to constantly remind interested parties that units are selling fast, and that all units are going to be sold out soon.
There is a huge banner hanging at the most prominent place in front of the sales gallery that says ’80 percent sold’. The headline in a local paper reads ’70 percent sold on the first day’.
However, some key information may be conveniently missing there, including:
1. The planned number of phases for the project launch; and
2. How many units are actually released in each phase.
The full statement should probably be:
1. ’80 percent of 50 units sold in phase one out of five phases’; and
2. ’70 percent sold on first day after 60 percent of units already taken up by VIPs before launch’.
When customers ask about the next batch of units for launch, sales representatives may hint that subsequent phases will offer units with poorer view or lower quality finishing, despite the fact that they are sold at higher prices.
Here is the truth: Developers tend to push the less desirable blocks or units to the market first. These units may present an average view, face the west sun or have an awkward layout.
There is a philosophy behind this: If they can sell units which are most difficult to move, the rest of the better units can definitely be sold, and at higher prices. The tactic is known as ‘save the best for last’.
You may be surprised to hear this. But the biggest discount is often not the one offered to the first batch of buyers, but the one given to the last few takers. The reasons are many:
1. The market situation may have changed.
2. The developer may feel that they have made enough profit for the units sold.
3. The marketing agent may find it too much work to continue running the sales gallery.
4. The last few units left may be the less desirable ones.
Sometimes there is really not much advantage for the early birds who buy earlier than others.
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Originally Posted by Rosy
