Three Takeaways: The 2020 International Builders Show
At the beginning of the year (*before the COVID19 pandemic), we got the chance to attend the 2020 International Builders Show (IBS) in Las Vegas hosted by the National Association of Home Builders (NAHB). Our goal was to see the latest and greatest strategies for builders; from sales and marketing to products and technology. IBS provides opportunities to learn what works and what doesn’t work which allows builders to scale with minimum roadblocks.
Below are three takeaways from IBS 2020.
1. THE WEBSITE: YOUR MODEL HOME’S UGLY STEP-SISTER
Many builders spend a lot of time and money on their model homes, but when you go to their website, it’s not a good user experience. This stage is when your potential buyer is weeding out home builder options, so you don’t want to end up on the chopping board. You need to ask yourself a few questions such as:
- Is our design outdated?
- Is our site mobile responsive?
- Do we have a clear call to action?
- Would our site’s spelling and grammar pass a 7th grade Language Arts test?
- Does our site include favorable testimonials or press coverage?
The transition from your website to your homes needs to be seamless. It needs to feel familiar, and if it does not, then it will feel uncomfortable. Home buying is an emotional decision, and feeling uncomfortable is not going to sell homes.
2. DON’T SELL THE STEAK, SELL THE SIZZLE
According to Harvard professor Gerald Zaltman, emotion is what really drives purchasing behaviors and decision making. In fact, neuroscientists have found that people whose brains are damaged in the area that generates emotions are incapable of making decisions. Understanding this concept – that humans aren’t as logical as we might think – has significant meaning for marketing, branding, and sales.
For example, by only marketing the features of your home, you will likely generate lackluster results. And the poor results you receive are due to the fact you are completely missing the human element in the decision-making process. Humans are driven by emotions. So if you want the consumer to remember your home, they must be engaged and excited by the interaction with your company. The key is to show them how they will feel making memories in the house, or show them testimonials of how past customers feel in their new homes. It’s all about the emotional response.
Good marketers utilize this idea all the time, and examples of emotion-based campaigns are everywhere. Nike and Under Armour inspire by offering immortality and glory through competition. Our feelings of self-worth and status in the world are targeted by luxury brands such as Lincoln and Rolex. Samsung and Apple excite us by offering a virtual link to friends, family, and the world.
You can still focus on the features of the home, but you can’t do that without also selling the lifestyle and the feeling. The key is to highlight the emotional response a consumer will achieve by using the product. Your brand should be able to communicate to your homebuyers that they are in good hands; they are upgrading their lifestyle. Their home purchase should be a dream goal for them to achieve, and if done correctly, they should desperately want to achieve that dream with your company.
3. AVOID THE “AFFORDABLE”
The third takeaway is that the word “affordable” can be construed as a negative word. We still see a lot of home builders or salespeople use that word too often. How would you feel if someone said your phone looks affordable? Your clothes look affordable? You just got engaged and your wedding ring seems so affordable?
Ok, it’s true that some buyers really are eager to find the best deal, but no one wants to feel like they’re actually making a cheapskate decision. Especially not when it comes to homes, which are many people’s largest lifetime investment. Most people want things that look expensive. They want to know why your homes are expensive, and how your homes are an upgrade from the competitor.
There’s a psychology behind why consumers like expensive things. According to a 2017 study, there’s a “marketing placebo effect” that takes place where consumers tend to value expensive items over their cheaper counterparts. Researchers conducted a study to find out how much consumers’ enjoyment of wine was influenced by its cost. Study participants were asked to sample the same wine but were given different information about its price.
The subjects thought the wine they were told was more expensive tasted better than the cheaper ones. In fact, MRI results showed that the part of the brain associated with reward and motivation, which directly affects the taste experience, showed increased activity with higher wine prices.
According to Victor Ricciardi, editor of the book Financial Behavior, our enjoyment of pricier products also comes down to our perception of risk. People are more likely to pay more for something if they perceive an “affordable” product as giving lower satisfaction and a higher risk. If a buyer spends more on a house, they’re more likely to see that experience as having a better outcome. They see it as a less risky “investment” because they associate higher price with higher quality.
This doesn’t mean you should force yourself to stop spending on more expensive products if they give you pleasure. Just do so in moderation. Buyers need to be able to afford the home they’re looking for, so finding a balance in quality and price with your target audience is vital.