This is the 2nd part of a three part series on international real estate project marketing.
To view part 1, please click here.
STEP 3 - MARKET VALIDATION FIRST
Our view is that market validation is extremely important regardless of the anecdotal confidence you have in your local market's international attractiveness (Miami to Latin Americans, Vancouver to Chinese, Sydney to Malaysians). We have seen time and again major developers in gateway markets influenced by the view that there is an insatiable demand for their market's product from a certain group of overseas buyers only to see the campaign fizzle out with underdelivered promises from overseas marketing companies. With that being said, we have also seen a number of success stories. What is clear to us for unproven product and distribution destinations is that rather than committing a large budget to a traditional comprehensive marketing campaign, that a cautious approach of market validation is the prudent strategy for almost all developers to take.
One of the core concepts of the Lean Startup methodology is the need for idea validation. If you’re a Manchester UK based developer and you know that Middle Eastern buyers have been active in London but are not sure if they will be receptive to your market, testing this concept online through different cost-effective channels is a great way to save a lot of time and money to see if there is hard interest.
Think about it, you can spend $10K-$20K in validating the market, possibly making a few sales in the process, and subsequently use real data to make a decision on whether it’s worth spending additional resources and manpower on developing a sales and marketing presence in a certain region. We’re well aware of numerous non-client developers who have spent over $100K USD, plus overseas travel costs, hundreds of hours of employees time, and endless late night conference calls without seeing results often because the market simply wasn’t there.
Once you have committed to experimenting in a certain market, the next stage is analyzing whether to execute in house or find an outside marketing company to manage your marketing campaign strategy.
STEP 4 – SETTING UP YOUR INITIAL LEAD GENERATION STRATEGY
As the debate continues on the value of traditional local advertising in real estate, it should not be surprising that traditional local offline advertising in overseas markets is of questionable value at best. We’ve seen numerous non-client developers and brokerages invest in this with poor results. The million dollar question is why do they keep doing it? Other than familiarity with the medium, and possibly the encouragement of a local partner who may be receiving a media buy rebate, it’s hard to understand why someone would opt for this strategy given the niche nature of the real estate being sold.
We should also begin by saying that unless you already have an exceptional buyer database, we strongly consult against holding expensive product launch events in overseas markets as well as consult against attending property conventions unless the cost is minimal and the convention has a track record of high attendance (validated by at least a few previous exhibitors who you trust). We often attend such events out of curiosity and it’s no surprise that very rarely do you see returning exhibitors. Although these events may have been effective platforms 15-20 years ago, real estate marketing has changed while the costs and resources required for these events have not.
Then what? Our initial suggestions are focused around 4 key first steps - Local Language Website(s), Relevant Search Engine Optimization Efforts, Relevant Paid Online Search/Portal/Advertising Campaigns, and offline channel partner identification and campaign management. We should note that these suggestions are for developers, brokerages, and agents looking at building a long term value added platform in their targeted market and will take time to generate results.
STEP 5 - SEARCH ENGINE OPTIMIZED LOCAL LANGUAGE WEBSITE AND PAID ONLINE ADVERTISING
Your company should have an attractive, mobile optimized, local language website that is also optimized for the relevant dominant search engine in the target market (For example Yandex in Russia, Baidu in China or Yahoo in Japan.) The algorithms for these search engines work different from Google and your foreign language website needs to be programmed accordingly to account for this.
Paid online advertising comprises of paid search, re-targeting, banner ads, social media advertising, online advertorials, property portals and/or directories, and broadly any online advertising campaign that is targeting your potential customers. Many of these are very effective for validating potential offshore markets for real estate projects. Depending on your targeted audience and the nature of your company/project, the optimized usage mix of these channels will vary.
STEP 6 - ADDITIONAL TOUCH POINTS POST INITIAL CLIENT AWARENESS
Once a buyer is in your pipeline, your dialogue with them should not stop after the first interaction. Instead, you should both directly and indirectly be engaging with them through different touch points in their local language.
There are many ways to do this, and this will vary depending on the market and your product mix, but it our view that one of the major reason's that companies fail when marketing internationally is a lack of follow up touch points. Think about it, if you do the basic as suggested above, your number of touch point’s is limited to a measly 1 or 2 plus follow on drip email campaigns and phone calls. In your home market, you will likely have a minimum of 8 and up to 20 touch points once you include all social media, local media, local advertising, signage, billboards, and word of mouth. When real estate developers fail overseas, they may blame their partner or various other factors, when the reality is they did not have a sufficient marketing ecosystem in place to nurture the leads that were developed in that market. The resources required to manage the majority of these touch points are not significant and would be worth exploring if it appears that your project or company is beginning to get traction in a certain international market.
STEP 7 - WORKING WITH CHANNEL PARTNER(S) EFFECTIVELY
When we say channel partners, we are generally referring to a brokerage or other product distribution company that targets a buyer group that your existing brokerage or local sales team cannot adequately target. One of the major challenges with overseas real estate project marketing is that channel partners are unavoidable, and as such they tend to influence decision making in areas where they often don't have the required expertise such as managing a more sophisticated marketing campaign. When it comes to making marketing decisions, our view is that channel partners should have little to no final say on how marketing dollars are spent although their input should be sought when formulating the initial strategy. Remember, channel partners core strength is their existing client network, so don’t blindly give them a marketing budget and expect miracles. It just won’t happen.
Also, it is important to note that you will likely need somebody local to meet face to face with potential buyers and who will manage and cultivate the leads you generate through your marketing strategy. If outsourced, this person or company will effectively be the primary channel partner and it is critically important that they are properly empowered and incentivized to close sales. Many times, larger distribution channels or brokerages will have an international team that is managed remotely and lacks the proactive energy and direct incentives required to successfully sell any difficult project marketing assignments. If it's a challenging sell in your own market, it likely won't be much easier overseas and the people and team who you partner with will quickly realize this in case it wasn't apparent prior to launching the campaign.
Once you've developed your initial marketing strategy and you've begun to generate leads, be sure that every piece of your marketing spend is traceable so that you can put more resources into what works and stop spending energy and time on what doesn't.
In Part 3 we will discuss converting non-local leads and building an overseas marketing platform that lasts.