Pakistan Real Estate Times - Pakistan Property News

Developers want to keep customers regularly updated with tangible proof that construction is moving forward.



By Jane Ferguson, Business Features Writer
Published: July 08, 2009, 22:52


Dubai: "In real estate nothing works like building and selling," explains Shyam Sunder, general manager of marketing at ETA Star property developers.

Words that may seem glaringly obvious, however, need to be set against a Dubai property market which experienced years of off plan explosion before foundations were built.

Property developers in Dubai currently have to convince customers of the integrity of their ongoing projects. New patterns in marketing must now react to balking consumer confidence, as off-plan is off the cards, and only real evidence of progress will suffice.

Indeed, with new buyers thin on the ground, developers are focusing their marketing towards existing customers rather than potential ones.

"Retention is more important than acquisition," said Sunder. "The entire marketing strategy is trying to retain our customers."

The way to do so, he explained, is to go back to basics, and sell properties that actually exist in some form or another, while keeping customers more regularly updated with tangible proof that the construction is moving forward.

At the end of 2008, as the property boom in the UAE began to ease, ETA Star decided to change their marketing strategy in order to bolster confidence.

"We said we have to go all the way to ensure confidence. The only way to do that is to build and show."

In order to show the buildings in an 'up front' way, the company's website was upgraded with actual images of the buildings, besides the usual computer-generated architectural impressions of a finished project.

"The first thing you will see in any developer's website is some glossy image," said Sunder. "All our projects are up and standing. The architectural image and the actual shot were very similar."

A reason for this, he explained, was the business development model the company has held for some time. Up to 80 per cent of ETA Star's current projects were launched between 2004 and the end of 2006.

By the end of 2007 they had launched 12 projects and have tailored future projects to fit future demand in property.

"We have only three to four projects to be launched. Maximum four. The result is that existing customers can see their building - a welcome image for many of Dubai's recent investors.

"We have this very unique advantage of having customers to come and see and feel and buy."

A general policy of starting work on a project no more than six months after launching it on the market is also an advantage in today's conditions of negative sentiment, said Sunder.

ETA, however, have not been immune to the global crisis, and delays have been experienced on some developments. However, Sunder believes the early progress made on their developments has been key to keeping investors on board, as nearly finished buildings are more convincing than off plan projects which have yet to be started.

"When the project is not even off the ground, that causes the panic and concern," he said. "Here we are talking about a full building standing. Only the interiors are to be finished. There's never been a delay on starting a project."

One such delay has been at a Jumeriah Lake Towers (JLT) development. Sunder said the company's reaction has been to maintain communication with buyers.

"There are cash flow problems. There has been a fair amount of delay," he said. "One to one, we have been in touch with every customer."

That communication must be clear and honest, he added.

"We are very clear about whether the project is progressing fast or not. So even if some of these projects are getting a little delayed we must update our photos."

Ultimately, as retention remains the main policy, challenges are customers who pull out, and those who don't pay.

"There is always a danger of you losing customers, whatever the cancellation charges, and getting out. The other is if a customer is not going to pay you. We have been telling them quite directly, 'we need you to stay in the market - our fortunes are linked'."

Keeping existing customers on board has brought about new strategies to help those who are facing funding challenges, by linking them with banks and lenders. Others who can pay are being encouraged on certain projects to pay in cash now and get a discount.

The new flexible, open marketing approach is working, says Sunder, with a near 100 per cent retention of existing customers.

http://www.gulfnews.com/business/Real_Es...29756.html