There is a brand new resource being made available for FREE (you will need a special code at the end of this blog post) that can change the way you release new communities – and get you more sales. It’s called Presale Without Fail: The Secret to Launching New Communities & Phases with Maximum Results a new eBook written by my friend Kevin Oakley the Director of Marketing & Sales Training for Heartland Homes in Pittsburgh, PA. He shares how to sell multiple homes on the day one without the need for a model home – or even paved streets! It’s step-by-step and proven to work.

I asked him to tell us a little bit about how it all works, and to answer some common questions he receives from others in the industry.

_________________________________________________________________________

Thanks Myers! I really can’t wait to see how this eBook will impact builders across the country – and I do hope you all will share your successes with me. Here are the answers to the most common questions I am asked about Presale Without Fail:

Q: My builder already creates a VIP list of people who are interested, how is this different?
A: It’s true that most builders today have VIP lists or waiting lists. That isn’t the challenge. Where most builders fail is that they don’t know what to do with that list to turn it into sales. What I outline is not just how to get more people on your list, but what to do with them at every step. The most common mistake I see is that they try to hold private VIP meetings with each prospect where the give them all the information up front and then people disappear… never to be heard from again.

Q: Isn’t your success going to be directly related to how much demand there is for your location?
A: The short answer is no. When I really knew that I had something that worked is when we had a new phase of an existing community about to open. The previous year we had only sold eight homes, and the new phase was the same product, at the same price point, and on the same size home sites. Using the Presale Without Fail process we sold eight homes on the first day the phase released.

Q: Do I have to be a large home builder to make this process work?
A: Not at all. Of course, a larger builder may have an easier time of the initial awareness of the project, but as a smaller builder you’ll be able to be more personal with every prospect. This book really levels the playing field and puts you back in control of your success, and not the current state of the market.

Q: Why are you giving this away for free if it is so valuable?
A: There are several reasons. The first is that I love to network with others in the industry and to learn from them what is working, and what isn’t. My hope is that this eBook opens new doors and new conversations that can lead to a true sharing of insights. I am not selling anything, and I am not looking to sell consulting and speaking services. The second reason is that it is my way of giving back to an industry that I love, and that has done so much for me and my family.

Presale Without Fail won’t be released until September 29th, but as a friend of Myers I’d like to offer you the opportunity to download it now. Just go to www.PreSaleWithoutFail.com and enter presale-myers as your pre-release code. By doing so, you will also be entered into a random drawing for one hour of Skype time with me to answer any questions you have about how to implement this with your builder!

I hope you enjoy the book, and I’d love to hear your experiences putting it into action!

- Kevin Oakley

Posted In: New Home Sales, new home sales management, New home sales marketing, New Home Sales Training

Tags: builders, ebook, Heartland Homes, Kevin Oakley, Marketing, myers barnes, sales

Taking control of your sales can be like trying to round up a pack of stray dogs. Without a strong leader, they will head in any direction. Dogs need to be controlled by someone with a calm, focused mind, who is steadfast and has a strong sense of determination.

When your sales run wild, your salespeople can become frustrated and overwhelmed trying to figure out what to do next. Should they offer incentives? Should they negotiate more? Should they discount the home? How will the buyers find your model homes? Is there an online marketing strategy to attract potential buyers?

They need a clearly defined set of expectations … a plan of action. Understanding what breed you are as a builder is the first step towards giving them that. The question for you is: Are you a dying breed or a breed apart? Are you old-school, relying on yesterday’s outdated methods to attract home buyers, or have you developed your own brand? Step out from the pack and say, “Enough! Enough discounting. Enough incentives. Enough justifying my prices!”

It’s time to take charge and acknowledge that you’re in business to make a profit … not just sell homes. Be the new generation builder who works within a system and can make a profit regardless of what the market is doing, which way the economy is heading, and how many builders are throwing in the kitchen sink.

Posted In: Leadership, new home sales management

Tags: builders, Deals, discounts, economy, incentives, leadership

It is not uncommon for builders to want to be in first place on the “top 100 builders in America” list. It’s good to strive for the top slot. However, it’s best to strive for the top-100 list of builders who make the most profit … not those who sell the most housing units.

Let me ask you this: Which builder is better off … one who sold 500 houses in one year and broke even … or a builder who sold 50 houses in a year, but made a healthy profit? It’s possible to be the top builder in your region or in the nation and be teetering on receivership. It’s also possible to be the 50th builder in number of homes sold, but first in profitability.

Winning the title without showing any profit is like running a race without a finish line. There is no closure. You just keep going and going … discounting … offering incentives … negotiating … selling your homes for less than you know they’re worth.

End the cycle. Step off the treadmill. Get back to making a profit. And the most direct way of doing that is to harness your spending and halt discounts. It’s better to drop a few spots behind on the list … to lose a few sales if necessary … and be profitable than to be number one and not keep your profit margins intact.

What’s important is not how many houses you sell, but how much money you keep from the houses you sell.

Posted In: New Home Sales Training

Tags: builders, Marketing, New Home Sales, profit

Maybe you’ve heard the story about the bearded lady and the circus clown who met and fell in love. They decided to get married and start a family.

Within a year, the bearded lady was expecting their first child. A few weeks before her due date, the circus ring-master and the bearded lady were talking.

“How’s it going?” the ring-master asked.

“We’re very excited,” said the bearded lady, “We have so many plans for the baby. We want to be excellent parents.”

“That’s nice,” said the ring-master, “Do you want a boy or a girl?”

“Oh, we really don’t mind as long as it’s healthy,” replied the bearded lady, “And it fits into the cannon.”

Too many builders take the Cannon Approach to profitability. They have great plans for their company and expectations for growth, but then they shoot holes in their bottom line by thinking, “I don’t really mind if I don’t make a profit as long as I’m selling houses.”

While building homes is a noble calling, your company is more than a manufacturer of good homes. Your first priority must be to make a profit. All other decisions should fall in line behind this one because, if you aren’t a profit-making company, it doesn’t really matter what else you make.
Helen Keller once said, “Life is either a daring adventure or it is nothing.” I’d like to paraphrase that: Selling homes is either about making a profit or it is about nothing.

Posted In: New Home Sales Coach, New Home Sales Management Training

Tags: builders, myers barnes, profitability, selling homes

When profits and sales drop, a naive mindset fills the void. Builders start thinking they need to sell more houses and offer more discounts to make up for the loss. So they offer jaw-dropping deals. Incentives. Promotions. Special sales. Discounts. Event sales. A whole bag of tricks to lure buyers. And what happens? They sell more homes, but make less money.

Most builders say, “Hey! I’m a builder. It’s what I do.”

I understand that, but you must also be heavy into sales and marketing or you won’t be around long to do what you do.

Building and selling homes at a discount isn’t a viable strategy. That’s why, at some point in your company’s growth cycle, you have to determine, “Is my company being market driven or sales driven?”

How do you know which one it is?

Think of your company as a boat anchored in the harbor beside 100 other boats. When the tide rises, all the boats go up. When it falls, all the boats drop with it.

The housing market is like tidal water. It goes up and down. If your company is governed by the market, it will follow the ebb and flow … rising and falling just like the other boats.

However, if your company is sales driven, you will pull anchor and leave for more favorable waters. Instead of trying so hard to steal buyers from other builders whose ships are anchored with yours, you will find buyers in areas that other builders have neglected. You will show in places where buyers least expect you. And you will attract buyers from the tidal pool because you have a superior sales and marketing organization.

Don’t be lured and lulled into believing that discounting is a smart marketing tool. If there’s a hole in your business that’s leaking profits, you won’t plug it by being gullible and thinking your can discount your way to profitability. That’s like rearranging the furniture on the deck of the Titanic when it’s sinking. It’s wasted effort.

Posted In: New Home Sales Coach, New home sales marketing

Tags: builders, Deals, discounts, incentives, profitability, sales and marketing, selling homes

It isn’t easy to make a profit in the construction industry; but it’s next to impossible to make one if you start discounting your home’s price before you even try to sell it. And yet that’s what many salespeople and builders do.

Four years ago when the housing market was vibrant and hot, buyers would never have thought about asking for a discount. Today it’s a different story, of course. There are too many homes competing for the same buyers. So builders and their sales team start out on the defensive trying to justify their prices. They assume everyone is bargain shopping. Therefore, if they offer the lowest price, they will get the sale.

Despite what you may think, all home buyers are not shopping price. They aren’t looking for the cheapest house to buy. Deep down, they know they get what they pay for. If they pay too much, they lose a little money; but if they pay too little, they lose a whole lot more in terms of service, quality, warranties and property value.

What home buyers want is the best home for them and they would probably like to get it at a discount or with an incentive package thrown in. What you need to do is to illustrate how your home is the best one for them. Show off its features … sell its value … defend its price instead of justifying it.

Do it right and your buyers will wonder why your home doesn’t cost a whole lot more.

Posted In: New home sales marketing, New Home Sales Training

Tags: builders, features, housing market, profit, profit and loss, value

Heard about the newest global positioning system? It’s highly sought after by entrepreneurs who need direction and a shortcut to success.

You log in your company’s current value and a monetary goal you’d like to reach. Then hit “Go.” As you work toward your goal, the GPS gives you voice commands: Turn this way to make a 20 percent profit. Take the next road to reach a 15 percent increase in sales.

You receive frequent reminders of how long it will be before you reach your destination goal. Nice. Simple. Easy.

Unfortunately, it’s also untrue. There isn’t a GPS that can plot your course so your business avoids dead ends, potholes, breakdowns, deep water, gridlocks and wrong turns. However, there is something you can use that will lead you to profitability if you follow the instructions. It’s called “selling to a process.”

A process is a series of actions and systems directed toward an end result … in this case, greater profits. Notice I didn’t say more sales.

Builders ask me all the time, “Myers, can you increase our sales?” I say, “Instantly! I can increase them 20 to 30 percent in one month. Give me a big enough discount and a budget to market the discount, and I’ll increase your sales overnight.”

They didn’t ask if I could increase their profits. To increase profits, I need to show them how to sell to a process without sacrificing profitability.

If you were to have a GPS Grail installed on your dashboard, what business goal would you punch in: Increased Sales or Increased Profits?

Posted In: New Home Sales Coach, New Home Sales Process

Tags: builders, business goal, myers barnes, New Home Sales, profitability, sales process

There once was a likable bloke

Who built homes for a whole lot of folks.

He discounted them deep

And priced them real cheap.

Or he did … until he went broke.

Ever heard of the P-Principle in new home sales? Probably not because it’s a term I created to explain why some builders go broke. Simply stated, the P-Principle is this: If you’re selling a lot of product, but not making a profit, you’ll eventually be penniless.

Don’t mistake income for profit. Income is the money you actually get paid. Profit is how much you have left after taking all the money you received and paying all your expenses.

Some builders lose sight of this and forget they are in business to make a profit. Instead, they think they’re in business to build houses so the more they build, the more successful they are. Not true. You could sell the most homes of any builder in your region, but if those sales don’t put money in your pocket, you’ll go out of business. The numbers that really count are the ones on the bottom line of your profit-and-loss statement; not the ones listed in some top-ten sales report.

You also shouldn’t be looking for break-even production. You must generate new wealth in order to stay in business, employ more people, take care of your family and contribute to a viable economy.

Call me the prophet of profit, but here’s what I’m proclaiming loud and clear: Builders … price your homes fairly, competitively and with a healthy profit margin. Then stay the course. Your goal isn’t just to record sales; it’s also to report a profit.

Posted In: New Home Sales Coach, New Home Sales Training

Tags: builders, goals, income, P-Principle, profit and loss, profit margin, profitability

I was recently talking with a builder who was incensed by the demands of prospective buyers. "They want me to just throw in a furniture package with the deal," he sputtered.

I listened and empathized with his plight. I’ve heard this same frustration voiced by many builders, developers, and new homes sellers in this market. Buyers want ridiculous discount and absurd freebies in order to close the deal. They’ve been handed a market where the buyer dictates and they are feeling choked by the heightened demands.

Let’s take a look at the situation though. The leak in the housing market started to trickle in the first quarter of 2007. Now, 25 months later, the sellers are scurrying to plug that gaping hole in a market that is flooded with short sales and foreclosures. The media, real estate agents, and mortgage companies are telling these buyers that now is a great time to buy. Have you ever heard them advise buyers that it’s not a good time?

As a result of the economic crunch, buyers are making offers that would have been swatted away like a pesky bug just two years ago. But these buyers, while they may appear vulture-like in their approach, are not fools. They resisted the top-of-market buying frenzy, sat on the sidelines to gauge the action, and are now quite enlightened about the status quo of the buyer’s market. They’re ready to play the buying game like a battle to the death. What you call "absurd", these savvy buyers call "realistic."

My advice to you is to be prepared. Know that these crazy offers will come, and that they arise from hopes but not necessarily expectations. Sharpen your negotiating skills and respond to those offers respectfully—because at least you have an offer to negotiate! Communicate the value of your property and justify the price. Work harder to see where you can cut your margins and where your buyer is willing to bend. A ridiculous offer just means you have to work harder and smarter.

Myers

Posted In: Customer Service

Tags: builders, buyers market, developers, furniture package, housing market, myers barnes, negotiating skills, New Home Sales, new home sales management, New home sales marketing, New Home Sales Training, new homes, Real estate courses

This article was contributed by Brian Flook, President of Power Marketing & Advertising, Inc. Power Marketing is a full service marketing company for builders and developers.

Memory – it’s the final frontier. We all know where it is; now we need to know more about how it works from a marketing perspective.

Let’s begin with the RAS (Reticular Activating System). The RAS is the "key to turning on your client’s brain." It is a complex collection of neurons at the base of the spinal cord that serve as a point-of-convergence for signals from the external world (our five senses) and the inside world (our intuitions, emotions, etc.). So what’s it have to do with marketing and selling? There are three important aspects of the RAS:

1. Positive Focusing — Allows a mother to hear her whimpering baby while dad never hears a thing.

2. Negative Filtering — Allows the person who lives next to the busy railroad or airport to screen out the annoying noise.

3. Individual Perceiving — This explains how five people who saw the same accident can have five different stories of what happened.

The RAS tends to allow three types of information through to your perception on a regular basis: things you value, things that are unique, and things that threaten you. My point is this; you need to clearly understand what is unique, compelling, and memorable to your prospective clients in order to get their attention. Then denominate that message powerfully and in a compelling manner to get the consumer’s attention.

A unique selling proposition (USP) is a marketing message that clearly communicates your building company’s distinctive and compelling selling point. A USP is not a headline, slogan or a catchy phrase. Forget words like value, quality, leading, and newest; they are too broad, too generic, and are too easy to emulate.

Your USP must be yours and yours alone. If your competition can claim to have your USP then drop it. If it requires complex analysis to validate, forget it. If it doesn’t fit your customer’s perceptions, don’t use it. In short, your USP must be memorable, distinctive, and it must sell! It must sell benefits, not features. It must talk about the consumer’s interests, not your ego. Appeal to the buyer’s desires. For instance, Hershey Chocolate has been an American candy staple since 1884. Hershey’s mission statement is: "Our mission is to be a focused food company in North America and selected international markets and a leader in every aspect of our business. Our goal is to enhance our #1 position in the North American confectionery market, be the leader in U.S. chocolate-related grocery products, and to build leadership positions in selected international markets."

Godiva Chocolate, on the other hand, was first to create the concept of premium chocolate. They did it by combining great chocolate, effective marketing, sophisticated packaging and selective distribution. Simply stated, Hershey’s Chocolate is to eat, Godiva is to give away as a gift. Note the subtle, but effective differences. None of us will purchase a bag of Hershey Kisses for a top client or a special date. Instead, we opt for the more expensive Godiva package that comes in gold packaging with a ribbon and special tag. It’s not so much about the chocolate, it’s more about the message our choice sends. It’s about the USP.

When creating your USP make it compelling. Avoid superlatives, sweeping generalities and gross exaggerations; it must be believable. If you have the right message and the wrong audience or the right audience and the wrong message you have failed. You must have the right audience and the right message.

Creating a USP is about more than knowing your customers. It’s about your customers knowing you! Ask these questions: What is unique about our building company? What aspect of what we do is meaningful to our customers? What positive message seems to exist in the market about our company? The bottom line is this: your USP must answer the question every consumer asks: Why should I do business with this builder and not the guy down the street? Remember; customers don’t come to buy from you, they come to eliminate you. The process of elimination is mush less painful than the process of selection. Too often it comes down to who gets eliminated last.

You must thoroughly understand both your customers and your product in order to create a powerful USP. Denominate the message powerfully and repeat it often. Repeat it everywhere. Get into your customer’s mind and make an impact. Remember, you must appeal to their wants and desires with a message that can get through all the marketing noise. Your message must get past the RAS by appealing to things your customer’s value or being unique. That message will get through and it will be memorable.

Brian Flook, MIRM
President, Power Marketing & Advertising, Inc.
301-416-7861

Posted In: Personal Development

Tags: builders, competition, customers, Marketing, New Home Sales Training, RAS, USP

The message appeared in my e-mail from a young builder who had worked in his father’s homebuilding company from the time he was a teenager. Now, in his mid-thirties, he has started his own business. His message read: "We need help. We built a model home, a glorious one for the parade of homes that received 95 percent approval on exit polls. Yet, it hasn’t sold and the interest meter is ticking. Our advertising isn’t working. We’re not salespeople; we are builders. What do we do?"

His situation isn’t unusual. For the most part, builders and developers have a habit of entering the marketplace with what is known as the "Field of Dreams" mentality – if we build it they will come (and buy). Usually, they say, they followed their "sixth sense," a perception or "their gut feeling" in building what they perceived the market needs.

The Four P’s

Construction, like sales, is a science and with any science gut feelings and hunches do not play a role when entering the marketplace. A good business plan should be developed with a solid strategy and an understanding that selling and marketing new homes consists of four components. Labeled the Four P’s, they were popularized by Proctor & Gamble and utilized by industry giants such as General Electric and Microsoft. The Four P’s are effective because they break the sales and marketing process into four parts: Place, Product, Price & Promotion.

Place:

If you have been in real estate or community sales for any length of time, you have probably learned the adage: The three keys to real estate, are location, location, location. Well, it’s absolutely true.

The successful builder/developer understands that people don’t just live in homes. They live in a particular area, within the confines of a neighborhood in which the homes are located. Location is the factor that separates one neighborhood from another. Any builder/developer can, for the most part, construct homes at approximately the same cost per square foot, provided comparable materials are used. But the one single factor that changes the perception of value is where one home is located over another.

Product:

Who is your competition? It is either other builders, or, in the case of an established neighborhood, the competition may be the resale market. In either case, if you cannot enter or establish a market with a perceived value that surpasses your competition, then consider "creative abandonment."

When evaluating the types of housing designs and floor plans, study the area’s past 12 to 24 month sale’s history. If a distinct market-share has been established with three-bedroom, 2.5 bath homes, then do not attempt to reinvent the wheel. Enter the marketplace with a proven design and simply add enhancements such as vaulted ceilings, spa baths, walk-in closets or a better use of square footage. Then, you are sure to gain your fair percentage of market share.

Price:

Again, gut feelings and hunches play no role in determining the price point when you enter the marketplace. Price cannot ultimately be determined by your desire for a certain profit margin, but rather by what the consumer has paid in the past.

Price is easily determined by comparable values, which can be accessed through MLS. To disregard historical pricing data and produce a product at prices that are not proven in the marketplace is writing your own invitation to disaster.

Promotion:

Contrary to popular belief, promotion is not limited to just a good "sales process." To reach a target audience, you must effectively plan and budget. My personal belief is that your marketing, merchandising and products should be so good that they could almost make you, as a salesperson, obsolete.

Rethinking The Sale’s Process:

With housing products looking more like commodities and with stiffer competition, today’s great salespeople have developed a new mindset. They recognize that success no longer depends on communicating the value of the offering, but instead rests on the salesperson’s ability to "create value" for customers.

Builders and developers who delude themselves into believing that selling is easy and strictly a function of foot-traffic (and then transfer that concept to their sale’s team), will be beat like a drum in the marketplace.

It is important to grasp this truth: a sale’s process is a series of actions and systems directed toward the end result, which is causing a sale on purpose.

In most cases, failure in the marketplace is the result of poor planning. The Four P’s – Place, Product, Price and Promotion – are like a four-legged stool. If each is not weighted proportionately and then backed with a proven sale’s process, the stool will wobble and become unbalanced. If the four areas are not balanced, you may see your sales topple just like a lopsided stool.

Posted In: New Home Sales Training

Tags: builders, construction, New Home Sales Training, sales process