Tammie Smoot Digital Marketing Consultant * Building Industry Specialist – 19 Years • MIRM, MCSP, CAPS, CGA, AA, Broker • 2013 NSMC Chair • 2011 NAHB PWB Woman of the Year • 2011 NAHB NSMC Bill Molster Award • 2010 NAHB MCSP of the Year!
• 2009 NC Distinguished Associate of the Year!
BDX : Who we are A team of online marketing experts. Solutions to create the complete digital experience
May I Ask a Favor?
1. 7 Brilliant Things Tammie Said 2. Facebook : Builders Digital Experience 3. Tweet -‐ #the_BDX 4. Who is Bill Barnes? 5. Thank You to our HBA Staff
Agenda
• Industry Initiative 2013
• New Home Shopper Tracking Study
• BDX Toolkit
• Insights & Implications
Strategic Industry Initiative
Expanding the New Home Market
The New Home Industry has a problem &
It is 8me to do something about it! 8
What is Start Fresh. Buy New?
– Large scale, industry wide campaign promoting the advantages of newly-‐built homes to home shoppers.
– Comprehensive, national research plan to gain insights from both consumers and agents.
– First-‐of-‐its-‐kind consumer marketing & promotional campaign reaching millions of home shoppers in 2013.
.
Examine Significant Industry Questions
How is the face of today’s home shopper
changing? How is the generational cohort shift affecXng the
shopping process?
What are the primary barriers to “New” home
purchases?
Why is appeal for new growing/waning?
Capture “Pulse of Shoppers”
How financially confident are home shoppers at the moment?
Which options are most popular today?
What type of incentives are most motivating to shoppers?
What type of appliance brands are
most appealing to shoppers?
Website
* Video views: >360k
*Total site visits: >1.1MM
Engagement: Time spent: 03:20 min
www.star<reshbuynew.com
© 2013 Builders Digital Experience, Inc. All rights reserved. 17
Insights from Home Shoppers, Recent Buyers & Real Estate Agents Summer 2013 Tracking Study BDX & Hanley Wood
Additions and Changes to Research in 2013
• 2012/13 National R.E. Agent Study • >4k active agents across 25 MSAs
• Completed 2nd Annual National Home Shopper Study • Added 6 new markets (31 total MSAs) • Included recent home buyers • Deep dive into “Quality” and value/cost perception • More extensive list of builders for brand awareness section
© 2012 Builders Digital Experience, Inc. All rights reserved. 18
Agent Study Executive Summary
19
Realtors overwhelmingly rely on MLS to learn about new builder properties • Beyond MLS, realtors learn about new homes through builder announcements and from other
agents/brokers
While realtors have a good understanding of why people are buying, they overestimate why buyers work with realtors
• Buyers look to realtors for help finding a home and negotiating price rather than mkt knowledge
About half of all realtors prefer to sell existing homes • Those that are not likely to recommend new homes to prospective buyers cite difficulties with
pricing and convincing buyers of the value
Nearly two-‐thirds of realtors believe that builders are not offering useful training about how to sell new homes
As expected, realtors recognize that new homes outperform existing homes on energy efficiency, customization, etc.
• Similar to prospective buyers, realtors have varying opinions about whether new homes offer higher quality construction than existing homes
1
2
3
4
5
Resulting Marketing Gap & Opportunity…
The Majority of the Realtors and Home Shoppers think that used homes are more affordable
85% of recent home buyers worked with an agent
agents are crucial
91% of those preferring new yet bought used worked with an agent
Boomers Are an “Easy-er” Sell
Have a home ownership rate of 76%, 21% higher than the US overall home ownership rate
86% of Home Owning Boomers live in Single Family Detached homes
Are 13% more likely to prefer new homes over existing homes (and 14% less likely to prefer existing over new)
Boomers have higher incomes, better credit, more wealth…
February 6, 2014
27
Top triggers: • Favorable home prices • Favorable interest rates • Considering retirement • Tired of current house • Relocated to new city • Desire to live closer to
family/friends
Source: Metrostudy Analysis; BDX 2012 and 2013 Homebuyer Insights Study, Hanley Wood, Chadwick Martin Bailey
Especially Compared to Boomers, Gen Y Is a Harder Sell, But They Are Looking
Have an estimated ownership rate of only 44%
Most impacted by tougher credit and down payment standards
Are 14% less likely to prefer new homes over existing homes (and 5% more likely to prefer existing over new)
Top triggers: • Favorable home prices • Favorable interest rates • Planning to increase to family size • Increase in income • Getting married/moving in with partner • Increasing rent
February 6, 2014
28 Source: Metrostudy Analysis; BDX 2012 and 2013 Homebuyer Insights Study, Hanley Wood, Chadwick Martin Bailey
Realtors’ Focus on What’s Most Important Does Not Align with Buyers Or What Helps Sell New Homes
29
Base: All (3,044) ● Q19: For each attribute below please indicate the extent to which you believe existing and new homes offered by builders differ? Use your mouse to slide the marker towards your answer. ● Q15: When working with a client to purchase a home, how likely are you to recommend they purchase….
A O S H J
L T
P K Q E D F
M C U V N R B G
I
0
25
50
75
100
Most Important Home Features for Driving Recommendations to Clients
Overall Importance
Average
A Lower cost per square foot/More space for the money
B Lower maintenance costs (money and time spent)
C More living space D Less living space E Proximity to good schools F Convenient to shopping/
entertainment/activities G Safer neighborhood H Character/Uniqueness of home I Convenient to work J Convenient to friends/family K Larger yard or lot/More space
between houses L Established neighborhood M Ability to customize house to best
suit you and your family N Community amenities (pool, park,
golf course, etc.) O Quality of construction P Architecture/Overall design
(appearance of house) Q Better floor plans for me and my
family R Energy efficiency S Sense of community within
neighborhood T Mature trees & landscaping U Prestige/Exclusivity V Storage space
Impo
rtanc
e*
Attribute *Derived Importance: The scores are shown as relative importances using TreeNet Analysis
Prospect Wave 1
27 38
0%
20%
40%
60%
Prospects Wave 1
Prospects Wave 2
% 1st Time Homebuyers
Changing Market Conditions Have Spurred More Traffic and a Higher Percentage of First Time Buyers
30
26
40 34
29
42
29
0%
20%
40%
60%
<Bachelors Bachelors Graduate or Pro. Degree
Educa8on
49
30 22
58
27
15
0%
20%
40%
60%
$50-‐$100k $100-‐$150k $150k+
Income
11
29 23
18 18 20
33 25
11 10
0%
20%
40%
60%
25-‐29 30-‐39 40-‐49 50-‐59 60+
Age
Prospect Wave 2
Source: BDX 2012 and 2013 Homebuyer Insights Study, Hanley Wood, Chadwick Martin Bailey
39 52
61 48
0%
25%
50%
75%
100%
Prospect Wave 1
Prospect Wave 2
Ownership
Own
Rent
17 14
78 83
5 3
Prospect Wave 1
Prospect Wave 2
Type of Construc8on
Custom built on own lot ExisXng Home Brand new home offered by builder
More Renters Are Shopping
31
39 43
61 57
Prospect Wave 1
Prospect Wave 2
Type of Home
Single Family Detatached
Other
Current (Prospect) Primary Residence
Source: BDX 2012 and 2013 Homebuyer Insights Study, Hanley Wood, Chadwick Martin Bailey
Foreclosures ??
Once Again, Life Drives Home Buying
32 Source: BDX 2012 and 2013 Homebuyer Insights Study, Hanley Wood, Chadwick Martin Bailey
53
58
65
67
67
67
71
72
73
75
51
53
61
63
61
63
65
68
66
70
0% 25% 50% 75%
Knowledge about the neighborhood
References for inspectors, contractors, lawyers, etc.
Determine what comparable homes sell for
Knowledge of market conditions
Have more up to date information on available properties
Assistance navigating you through the purchase process
Draft offers and contracts
Find homes with your specifications
Coordinate viewings/appointments
Help negotiate terms/price
% of respondents
Reasons for Using a Realtor Prospect Wave 1 Prospect Wave 2
12 12 4 3
84 85
0%
25%
50%
75%
100%
Prospect Wave 1
Prospect Wave 2
Intend to Use Realtor Don't Know No Yes
Realtors Remain a Critical Partner in the Buying Process
33 Source: BDX 2012 and 2013 Homebuyer Insights Study, Hanley Wood, Chadwick Martin Bailey
Quality of construction
Safer neighborhood
Better floor plans
Energy efficiency
Lower maintenance costs
More living space
Lower cost per sq. foot Architecture/
Overall design Larger yard
or lot Convenient
to work
0.00
2.00
4.00
6.00
8.00
10.00
12.00 Top 10 Most Important Considerations
for Home Purchase
Wave 1 New Segment
Wave 1 Indifferent Segment
Wave 2 New Segment
Wave 2 Indifferent Segment
Average
Top Criteria Remain Largely Unchanged: Quality Reigns Supreme
34
Mea
n im
porta
nce
Source: BDX 2012 and 2013 Homebuyer Insights Study, Hanley Wood, Chadwick Martin Bailey
30
21
33
31
39
38
41
49
58
61
80
31
20
31
23
36
35
34
47
58
63
77
0% 25% 50% 75% 100%
New is Better Existing is Better
29
13
20
13
11
11
8
6
6
7
2
25
11
18
14
12
10
9
6
7
5
2
0% 25% 50% 75% 100%
Prospect Wave 1 Prospect Wave 2
New Homes Have Improved/Maintained Performance in Many Areas But Lost Ground on Quality
Energy efficiency
Ability to customize house
Lower maintenance costs
Beger floor plans for me and my family
Community ameniXes
More living space
Storage space
PresXge/Exclusivity
Architecture/Overall design
Safer neighborhood
Quality of ConstrucXon
35
Existing is Far Better (4pts)
No Difference (Middle 3pts)
New is Far Better (4pts)
Items rated on an 11pt slider scale with anchored ends. Data shown excludes middle 3 points. Items sorted by gap score (new-existing).
Attribute Performance (sorted from high to low based on gap between new minus existing)
Note: Movement of approximately 4 pp is considered meaningful
Source: BDX 2012 and 2013 Homebuyer Insights Study, Hanley Wood, Chadwick Martin Bailey
0
4
5
5
7
9
10
8
11
12
12
16
0
5
5
6
7
9
11
9
11
12
11
14
0 5 10 15 20
Prospects
Recent Buyers
Buyers Use Essentially the Same Factors to Determine Quality of New and Existing Homes
Durability
Workmanship/Craftsmanship
Structural Materials
Fit and finish
Warranty
Architectural Design
Performance specifications
Energy ratings
Built to specifications
Newest technology
Good for the environment/green
Other
36
0
5
6
7
8
9
9
10
10
11
11
13
0
6
6
7
8
9
10
9
10
11
11
13
0 5 10 15 20
Existing Quality New Quality
Importance of Criteria for Determining Quality (among shoppers who will or did consider each type of home)
Source: BDX 2012 and 2013 Homebuyer Insights Study, Hanley Wood, Chadwick Martin Bailey
How do we combat this?
Segment Summaries
38
New Segment
18% of the market
Indifferent Segment
36% of the market
Existing Segment
47% of the market
Who are they? (Compared to other segments)
• Slightly older • More likely to be retired • Less likely to be first-time purchasers • Slightly higher incomes • Over index on Elite
• Slightly more educated • Over index on Entry Level,
Renters
• Slightly younger • Most likely to work full time • More likely to be first time
purchasers • Expect to spend less • More likely to be planning for an
increase in family size • Over index on Feature & Location,
AA Entry Level, Renters
What have they done?
• More likely to have visited model homes
• Spoken with builders
• Engage in both new and existing behaviors (looking at model homes, looking at home listings online, and driving around looking of homes)
• More likely to have watched TV shows about local homes/real estate
• Looked at home listings • Visited an existing home • Spoken with a realtor • Sought pre-approval for a loan • Bid on a property
Which features are most important to them? Are new construction homes differentiated* these features?
• Quality of Construction
• Better Floor Plans
• Safer Neighborhoods
• Quality of Construction
• Better Floor Plans
• Safer Neighborhoods
• Quality of Construction
• Better Floor Plans
• Safer Neighborhoods
What are perceived barriers to purchasing a new construction home?
• Lower cost per sq. foot • Larger lot • Less living space
• Lower cost per sq. foot • Larger lot • Character/uniqueness
• Quality of Construction • Lower cost per sq. foot • Overall Design • Larger lot
*Performance gap (new-existing) score: Much better than existing (20+ higher), On par with or slightly better than existing (0 to 19), Worse than existing (<0)
Source: BDX 2012 and 2013 Homebuyer Insights Study, Hanley Wood, Chadwick Martin Bailey
The process is lengthy & emotional… the joy gap is real
JOY Gap
- Joy! - Relax – focus on your “want-
to-do” list Joy
OFFER ACCEPTED
BEGIN JOURNEY
Excitement “I’m ready for a new
adventure!”
Worried “I hope I make the right
choice.” “Who can I trust?”
Nervous “Can I afford it?”
“Did I buy a lemon?”
Exhilaration “I found the house!”
Tentative Excitement “We did it, but now
what?”
MOVE-IN DATE
Cautious “Will the build process
go okay?” (new) “What will the
inspectors find?” (existing)
Life in an EXISTING home
Life in a NEW home
- Joy (guarded) - Stressed – list of “to-do’s” is long
…and emphasize the attributes shoppers value most
Designed for Living
Low Cost of Ownership
Quality Construction
Energy Efficiency
Unleash the value and power of BDX Audience
1,500,000 unique monthly shoppers
Interest Desire Behavior
Brand Awareness, Perception & Opinion How do you stack up with
regards to value?
What can I do to improve my image?
How would you rate each of these builders as far as construc8on quality is concerned?
What is your local brand awareness, aided & unaided?
How likely would a shopper refer you to a friend?
Realtors Primarily Rely on MLS to Learn about New ProperXes
58
1
8
5
5
7
13
13
16
16
18
18
20
25
29
37
38
45
49
80
0% 25% 50% 75% 100%
None of these Other
Radio adver8sing Television adver8sement
Local magazine/publica8on Social media (i.e., Facebook, Twiier, etc.)
Na8onal real estate lis8ng websites Local newspaper ar8cles
Billboards and roadside signage Local newspaper adver8sements
Online adver8sement Online search engines (i.e., Google, Yahoo, etc.)
Local Real Estate/New Home Publica8ons Local real estate lis8ng websites
New home open houses hosted by builders New community/model home visits
Other agents/brokers Builder announcements (e.g., e-‐mails, etc.)
Mul8ple lis8ng service (MLS)
% of respondents
Sources of Informa8on
Base: All, 3,044 ● Q14: How do you become aware of new homes offered by builders that are available to prospecXve (residenXal) buyers that you work with? Select all that apply.
THANK YOU FOR ATTENDING
Tammie Smoot MIRM, MCSP, CAPS, CGP
Digital Marke8ng Consultant– Building Industry Specialist
Builders Digital Experience
2011 NAHB Professional Women In Building – Woman of the Year 2013 NAHB NSMC Chair
The Carolinas 704-‐507-‐4411
Builders Digital Experience