Case Studies

Welcome.  As I’ve mentioned before, probably too many times, Reimagine Selling and Marketing is all about results.  Not the kind of results where some manager or associate says, “We sold three more homes after the training.”  Or where they tell you that they sold a community out in two or three months. We don’t brag until we’ve measured at least 12 consecutive months.

Every month or so we’ll post a new study to let you peek at how we’ve helped other builders just like you.  Here goes.

 

A Tri-State Builder Feeling The Affects of Their National Competitors

Problem: Sales were slipping due to the appearance of national builders in what was always a “local market. In addition to the new competitors in the marketplace this Mid-west builder was experiencing other competitive difficulties:

  • The market was showing signs of slowing down
  • Corporate culture did not provide for “outside” help
  • Strategies focused specifically toward construction quality
  • Sales and marketing was the step-child of the company
  • The builders current floorplans were at least 10 years old
  • The models themselves were at least 10 years old
  • Model merchandising had not been updated for at least 5 to 10 years
  • Sales people were part-time and untrained
  • Prices were higher than the national competition
  • The builder was one of the best companies in America regarding metric and ultimately profitability

Solution:  The corporate sales director went out on-a-limb and argued to introduce sales training into all 7 divisions.  Sales training seemed the most efficient course of action due to budget , time, logistical and culture constraints.  This was grudgingly approved and training began in 2006.

  • Part time associates were replaced with full time people
  • Training was moved from the classroom to the field
  • Strict metrics were put in place and followed
  • The builder CEO and COO closely watched return per training dollar
  • Sales managers at each division received additional training to be certified Reimagine performance coaches
  • Sales managers were required to participate in performance coaching each week with each associate

Results:  After an initial 6 month training program, it was agreed that both parties would partner to make this a closely monitored and measured research program.  After almost seven years, the research program is still in place, as are the measurement and tracking metrics.  The initial results from the training are below.

Research Start

Total Length of Research

Length of Initial Research

Number of Divisions

Number of States

Sales Per 100 Visitors Start

Sales Per 100 Visitors Finish

Customer Satisfaction

Cancellations

Cycle Time

Market Share

Note: During the study period there was no change in advertising, sales office design, incentives, merchandising or floorplan design. Any incentive was always lower than the competition. Price was always higher than the competition (Eight to ten thousand dollars).

January 2006 (Still ongoing)

6 Years 11 Months Total Research Time

18 Months

7 Divisions

3 – Ohio, Michigan, Pennsylvania

4.4 Sales per 100 Visitors – Average All Divisions

15.2 Sales per 100 Visitors – Average All Divisions

7% Increase

4% Decrease

48% Decrease (First visit to time of contract)

35% Increase (Outsold competition 4 to 1)

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A Phoenix Builder Had Their Sales Decrease Over 50% over a 3 Year Period in a Strong Market

Problem: Sales for this local southwest builder were steadily declining in a hyper- competitive marketplace. Literally every national builder was represented and most were “flagship” divisions.  Other local builders were unusually strong and able to defend their brand.

The strong competition fueled high incentives and discounts that this builder was not able to match.  Sales had decreased over 50% in a three-year period (400 plus homes down to 172) in a market that was expanding and growing.

Other problems included:

  • Any hint of strategy focused toward construction quality
  • Construction quality wasn’t any different than any other builder
  • Sales management was weak compared to other builders
  • Sales associate skill levels were weak compared to other builders
  • The brand focused on “Elegance by Design” on was not product visible
  • No part of the marketing mix matched “Elegance by Design”
  • The current floor plans were new, but no different than the competition
  • There was no preplanned brand or brand message
  • Model merchandising was monochromatic with no psychographic target
  • A unique difference was not evident anywhere
  • Prices were higher than the competition
  • A unique difference was not evident anywhere
  • Sales were dependent on discounts and incentives
  • Morale was very low

In summary, nothing fit or supported any part of the brand package or message. The faux brand “Elegance by Design” could not be defended, let alone extended.

Solution:  After extensive discussions, the managing partner decided to implement the Reimagine Sales and Marketing program.  He made it clear that all forward action must be efficient and effective in order to reverse a downward trend.  Even though immediate action was critical, it was agreed that we needed to first gain an accurate picture of the company’s value position in the market.  Research began in approximately mid October.

  • A psychographic research project was immediately started
  • Value Mapping research was conducted concurrently
  • Research results were reviewed over the December holidays
  • A Brand Message (USD) surfaced from the research and was approved
  • The program development phase began in mid January
  • Vanilla, Functional, Spacious Family, Luxury Retreat and Grand Winner housing psychographic results were reviewed
  • The Spacious Family profile was selected due to the supply/demand curve in the Phoenix marketplace
  • A new community with newly started conceptual drawings was selected for trial research
  • Marketing, advertising, sales office design, sales office displays, collateral material, merchandising, landscaping and etc. were designed to reflect the USD design profile and CMA of the Spacious Family and psychographic profile

Results:  The test community sold faster than any previous site in the valley. A metrics program was put in place to measure all current communities and plan all new ones. The specific Spacious Family design type became the baseline acid test for all design and marketing decisions.
In the five years to follow, sales grew from 172 homes per year to over 800 homes per year.

fiveyear

Research Start

Total Length of Research

Number of Communities

Number of States

Sales Start

Sales Finish

Perception of Value Better Than Competition

Plans Better Than Competition

Note: During the initial study period there was no change in advertising or sales office design. Any incentive was always the same as competition. Price was always the same as competition.

 
 

January 2006 (Still ongoing)

5 Years 11 Months Total Research Time

8 Communities

1 – Arizona

172 Sales Per Year

823 Sales Per Year

94% Positive

91% Positive

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