REHDA: REGIONAL ECONOMIC & BUSINESS OUTLOOK...

HOW TO SELL & MARKET CREATIVELY

IN THE CURRENT MARKET?

BY:

SARKUNAN SUBRAMANIAM

MANAGING DIRECTOR,

KNIGHT FRANK MALAYSIA SDN BHD

REHDA:

REGIONAL ECONOMIC & BUSINESS OUTLOOK

CONFERENCE 2017

Marketing Strategies of Selected Developers DEVELOPERS' STRATEGIES



SUNWAY PROPERTY

Sunway Property Certainty Campaign


Guaranteed Loan

12:88 plan

Buyer pays 12%, Sunway provide loan of up to 88% at vacant

possession (from internally generated funds)

Campaign period: 29 March – 30 September 2016

Applicable to participating residential & commercial projects

Deferred Payment

Initial down payment from 3%

Zero payment for 12 to 24 months from launch date

Applicable to new launches

Voluntary Exit Plan (VEP)

Option for buyer to withdraw from SPA in event of employment

termination

MAH SING GROUP BERHAD

Lock & Roll Deferred Financing Campaign


“Lock in”

Buyers can first “lock in” a unit with a RM10,000 booking fee

“Roll”

Buyers can then “roll” out their cash for other priorities or investment

purposes

Scheme makes it easier fro buyers to own a property that is completed

Requires minimal monthly repayment for the first 24 months

Buyers to pay interest on their loan for the first 24 months and the full

instalment will only begin from the 25th month

More than 400 residential and commercial units on offer under this

scheme which ended 31 December 2016

2017 Chinese New Year Bonanza: cash rebates starting from RM888 up

to RM18,999 in addition to any other sales packages offered for

selected Mah Sing properties. Promotion ends 28 February

SIME DARBY PROPERTY : “Big 5” Promotion For first time homebuyers and loyal customers

DEVELOPERS' STRATEGIES

5 townships — ALYA Kuala Lumpur; The Véo in KL East; Castilla, Siphonia and Siphonia 2 in Chemara Hills; Saujana Impian’s The Brymwood and Villa Safira and Planters’ Haven.

Promotional benefits offered via the Big 5 promotion include: • Discounts ranging from five percent to 10%, • upfront PRIME or double PRIME discounts, • One year free Astro subscription package

Promotion period Feb to 31 May 2017 Potential consumers may also opt for Sime Darby Property’s Chinese New

Year RM8,888 rebate on the 10% initial payment, which ends on Feb 28. The rebate is applicable for over 1,500 residential properties across Sime

Darby Property’s townships.

Marketing Strategies of Selected Developers

IOI PROPERTIES: Buy Now, Pay Later

SELANGOR DREDGING: Reside-and-Purchase (RAP) ‘Why rent when you can own within 36 months?

SP SETIA: 10:90 Scheme - Build-then-Sell (BTS)


Deferred Payment • Up to 24 months to pay the balance of deposit and

differential sum / upon vacant possession (whichever is earlier)

• 5% down payment and move in immediately • Loan differential – to be settled by up to 36 months in rental

and balance via bank loan at the end of 36 months • Applicable to selected projects

• 10% down payment upon signing SPA • Balance 90% after completion of property (supported by

CCC)

Marketing Strategies of Selected Developers

TROPICANA CORP : ‘Tropicana 0% Interest Plan’

‘Just Bid It’


‘Zero Interest, Zero Worries’ •0% interest rate on instalments for up to 24 months •Low Down Payment (from as low as 1%) •Zero progressive payments for up to 24 months •Campaign period: 21 October to 31 December 2016

Digital / online campaign •Opportunity for bidders to put a price tag for the property they are interested in at the lowest price •Floor price set by developer •Applicable for selected units within selected projects •Campaign ended 20 May 2016

IJM LAND: LifesHome Triple Insurance Protection Schemes, (HomeTIPS)


• A collaboration with Allianz Life Insurance and Allianz General Insurance Co to underwrite three insurance schemes for 36 months from the date of signing of sales and purchase agreement at no additional cost.

• For direct purchase of residential project between RM300,000 to RM2,000,000 with IJM Land from 19th August to December 2016.

• The three insurance schemes are: Unemployment Benefit: covers cases of involuntarily termination from

of employment due to economic reasons. Group Term Life Scheme: covers financial benefit paid out in the

unfortunate case of death or total permanent disability Personal Accident Scheme: covers financial benefit paid out in the

unfortunate case of death or total permanent disability

MAJU HOLDINGS Maju Lease and Purchase Scheme (MLPS)


• For the development of Maju Kuala Lumpur Sungai Besi. • During construction period: Low booking instalment with payment option -

RM300 monthly fee during the construction period of 3½ years, to be saved on purchaser’s behalf for future utility fees, legal expenses and maintenance bills.

• Upon completion: The property price will remain the same during the construction period and carry through for another 5-year term after completion with two options Option A: Rent the unit with RM2,000 monthly rental throughout the

following five years. Option B: Purchase the unit by signing the sales and purchase

agreement at the original price.

TITIJAYA LAND BERHAD

Exclusive Rewards & Privileges for Buyers


“Referral Cash Rewards”

Buyer get Buyer (BGB) incentive programme: cash referral fee

“Buyer Rebate Program”

BRP programme: get additional cash rebates / discounts when you

purchase your next property from Titijaya

“Exclusive Invites”

Exclusive invites for private events for Titijaya buyers

“Exclusive Previews”

Exclusive previews for the latest Titijaya properties in the market

UEM SUNRISE: Signature Selection Campaign/ Rendezvous in France 2016


• 2-month campaign held in 2015 (1 September – 31 October 2015)

• Applicable to selected projects

• Buyers of projects eligible to participate in lucky draw – RM2 million worth

of prices (cars and holiday vouchers)

• Campaign period: 1 April – 31 May 2016

• Applicable to selected projects

• Campaign cost: RM2 million (all-expenses paid trips to UEFA Euro 2016

matches and car)

DEVELOPERS' CURRENT

STRATEGIES

• Focus on existing products (unsold stock)

• Smaller size product(s) to keep end pricing attractive

• Affordable homes (depending on the area)

• Addressing first-time homebuyer’s financing issues

• Selling a better lifestyle, one that they cannot afford right now –

i.e. fast forward future

• Certainty

• Discounts

• Deferring Payment (Rent then buy included)

• Financing assistance

• Insurance

• Gimmicks/ gifts


Yes, to an extent. Selected schemes have seen successes

with developers reporting higher/ improved sales.

Despite the various marketing strategies, the level of affordability remains low. But these strategies

are here to remain. A revolutionary reinvention is required

Are these strategies going to be sustainable?

Are these strategies effective?

5 COMPONENTS THAT MAKE-UP

COST/ PRICE

Land Costs / Prices

Construction Costs

Compliance Cost (Indirect)

Capital Contributions (Direct)

Financing Costs / Required Return

COMPONENTS THAT MAKE-UP COST/ PRICE

DEVELOPERS' CONSIDERATIONS

To address these costs:

REINVENTING STRATEGIES

Prefabricated Timber Framing Systems

Different quality/ cost packages

1. Addressing cost

Requires legislation changes

Panel subsidiary renovators – pass cost

Bare shell like in China/ Thailand: save costs to purchaser as not to pay and repay for renovation

2. Efficient design

3. Industrialised Building System (IBS)

4. Reinvent the product

HOW TO SELL & MARKET CREATIVELY IN THE

CURRENT BUYER’S MARKET

Steel Framing Systems

1. Be the ‘go-to’ expert: Be known as a thought-leader who provide in-depth

market knowledge Be an educator on design trends / market cycles Be a facilitator or multi-skilled single point of contact

2. Collaborative partnerships: Brand association (auto, retailers, etc.) – luxury,

prestige, quality Raise profile (company & agent) – attract / share a

target audience

3. Go Digital: Online / mobile – embrace user-friendly

technology to advertise your property and services

Demonstrate creativity / flexibility / adaptability in a fast moving digital world

Visuals, visuals, visuals – 1st thing that draws attention / video tours / drones




5. Networking: Client contact – engage with a human

touch / repeat buyers A life-long habit – learn & interact Seek out & attend events that attract

target market – sales agents are never ‘off-duty’

4. Create a buzz: Social media – highlight USP’s / spark investor interest Articles, interviews & media exposure can garner plenty of new interest & improve project awareness




6. Client Database: Consistent exposure of branding to dominate mind share

7. Price Right: Study market conditions carefully to understand what price tier will enable you to achieve your desired ‘speed of sales’

8. Hire Right: Your sales team should be an ideal mix of mostly younger members with a

minority of senior ones – selling requires energy and creativity (youth) while direction / strategy comes easier with experience




9. Outsource Right: Even the largest of developers do not have access to clients in various regions and countries. Work with agencies and co-operate with them to expand your marketing reach.

10. Budget Right: Campaigns can run flat if not budgeted for

properly. Focusing too much on the launch may burn your

margins in a slow market – embrace digital and other non-traditional forms of advertising plus product distribution to enable your campaigns to run smoothly




11. Innovate: Stand out from the competition and keep trying new strategies For e.g. introduce non-traditional payment plan such as build-then-sell; use virtual reality systems in place of scale models at sales gallery etc. – some of these may click and others won’t but many will serve as buzz-worthy elements for your brand

12. Right Product: Create a brand or niche product category, yet broad in different locations Market positioning – sell an idea / lifestyle, not a house



13. Track Record: Testimonials Zero defect / manage defects Good property management

THANK YOU

CONTACT US Knight Frank Malaysia Sdn Bhd

Kuala Lumpur HQ

Suite 10.01, Level 10

Centrepoint South

Mid Valley City

Lingkaran Syed Putra

59200 Kuala Lumpur

T: (603) 2289 9688

F: (603) 2289 9788

Johor Branch

Unit 3A-1, Level 3A, Bangunan Pelangi

Jalan Biru, Taman Pelangi

80400 Johor Bahru

T: (607) 338 2888

F: (607) 332 6788

Penang Branch

Unit 3.08, Menara Boustead Penang

No. 39, Jalan Sultan Ahmad Shah

10050 Penang

T: (604) 229 3296

F: (604) 229 3216

Sabah Branch

Unit No. P1/L/72/3A, 4th Floor, Block 72

KK Times Square, 88100 Kota Kinabalu Sabah

T: (60) 88 448 649

F: (60) 88 448 651

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