Thai Real Estate Developers Offer Trips Bonuses And Gifts

[george]

Thai real estate developers offer trips bonuses and gifts

Mass-media campaigns replaced by free furniture, overseas trips, new cars

Property developers have changed their marketing strategies in an effort to boost sales in the current sluggish economic conditions by switching from mass-media campaigns to direct marketing and events that will take their messages directly to target customers.

A survey by The Nation last week found that most developers had reduced their marketing expenditure to help them survive the economic slump and were offering new residences through events and the direct appeal of bonuses, discounts and gift packages.

There is a widespread belief that direct and event marketing will be more effective in its appeal to home-buyers and will also cost less than traditional mass-media marketing.

NC Housing's director Somnuek Tanthathoedthum said his company had cut marketing costs by trimming back on mass-media and print advertising and using direct marketing.

The company's projects, their size, discount prices and promotions are offered directly to customers by mail.

The company has created special promotion packages, such as free furniture or gardens, to attract buyers. This will cost less than using mass-media advertising and will appeal directly to customers, he said.

NC Housing has set aside a marketing budget equal to 2 or 3 per cent of its total sales, which are expected to reach Bt1 billion this year, Somnuek said.

Preuksa Real Estate's chief operating officer Prasert Taedullayasatit said his company had changed its strategy by focusing on below-the-line marketing, including event marketing and direct mailing. It has cut back on print, TV and radio advertising because it believes the below-the-line strategy will involve lower costs and will appeal more directly to prospective home-buyers.

Preuksa's marketing efforts also hinge on the size of new dwellings. Its research has revealed that its target customers are inconsistent where it comes to the size of homes they are seeking.

"We have learnt that customers in different locations have different demands [regarding the size of new homes]. As a result we have to create promotions to match customers' demands in different locations," he said.

The company expects to spend between 3 and 5 per cent of its targeted sales on marketing. Preuksa expects revenue of Bt18 billion this year, Prasert said.

Asian Property Development's senior vice president Visanu Suchartlumpong said his firm would maintain its planned marketing expenditure of between 3 and 5 per cent of total sales this year, and the company was expecting revenue of Bt8 billion. However, it will switch to event marketing and away from mass-media promotion.

"At this time, we want a marketing tool that will influence home-buyers. Our brand image is currently strong among our target customers. Our business strategy is to create more satisfaction for our customers by launching events and campaigns that will appeal to them directly," he said.

For the month of February, Asian Property Development has launched a marketing campaign entitled Valentine Bonus. Customers who buy either a detached house or a townhouse from one of the company's projects will receive a package tour of Switzerland, Italy, the Maldives, and Japan worth up to Bt800,000. The campaign will run until February 28.

"We will launch a new marketing campaign every month, focused on event and direct marketing rather than mass media. This will help to reduce our marketing costs, but will also have a direct impact on our target customers," Visanu said.

MK Real Estate Development's vice president for finance and accounting Chutima Tangmatitham said her company planned to spend 3.5 per cent of its total sales on marketing this year.

The company is aiming for revenue of Bt2.5 billion, giving a marketing budget of about Bt80 million - more than the Bt70 million it spent last year.

Like the others, MK's marketing strategy will focus on events and direct marketing, especially promotional offers of furniture and gardens to appeal directly to prospective customers.

The company's latest campaign, called Chuan Chun Plus Plus, offers free furniture and gift vouchers for kitchen furniture with a combined value of Bt275,000, plus entry in a lucky draw for a new Toyota Camry worth Bt1.1 million.

"We believe that direct marketing will have a stronger impact on our customers than mass-media advertising, so we've changed our business policy to boost sales in 2009," she said.

-- The Nation 2009-02-11

[theoldgit]

I suppose those buying property would benefit from these deals, though I think they would need to retain some sort of media advertising, probably not those glossy covers on the newspapers, otherwise how would prospective buyers be aware of what's on offer? Not sure how you dirctly market those who might be looking for property.

[bkkjames]

I suppose those buying property would benefit from these deals, though I think they would need to retain some sort of media advertising, probably not those glossy covers on the newspapers, otherwise how would prospective buyers be aware of what's on offer? Not sure how you dirctly market those who might be looking for property.

I think what they are getting at is they plan to do more events like "Property Fairs" instead of say running an ad in the newspaper where they may hit 1% of readers who might be interested in buying a property.

[Boater]

well these deals have been added onto the price of the property

also if anyone has been to Dubai, Damac normaly runs these kind of campaigns

[shochu]

as the wording implies - they are bonuses, incentives...

THEY HAVE NOT BEEN ADDED ONTO THE PRICE - if anything u could call it a discount WITH a forced shopping incentive!

i know because i have been tracking a number of developers for a couple of years now.

because lowering prices would anger those who have already bought THIS FIRST tactic is to maintain prices and the yearly increases (minimal) in order to make them appear to be holding steady including a bit of inflation - BUT - in order to induce customers - they are offering many THINGS that really amount to up to about 10% in incentives such as a combination of gifts, furniture, air tickets, etc.

the new place i just signed on offered this and i bought - because for location (very central) and developer (very good) i knew eventually it would be a better bet for me than keeping extra money in a bank PERIOD. even though i expect prices to come down.

i am not condoning getting into the condo market - BUT u must do ur own due diligence and see where u r and where u want to be - taking into consideration what is and what will likely happen. only u can figure this out.

by the way - i bought off plan as i trust these guys and i get regular updates. they only had a few units left to choose from as i saw the list of units available/taken, and deposits only on the master list on the computer - so i know it was not just a sales tactic. as i said before - some guys (the reputable and larger thai developers) r doing okay - enough to continue their original plans. i do not fear this project not being completed albeit it a few months behind schedule as that seems to be the norm with all their other projects. and i do not think this particular project will reduce their prices as they do not really have many units left and what is left is not a burden on the project. and i actually think it is not a bad deal when i consider my options.

going forward, i think even this developer, based on the way the market is going will be looking to start new projects with a lower cost per from what i have gathered.

so re: the article - not really lowering the price but more trying to sell using incentives.

however, i do see some projects lowering their prices!

[Boater]

however, i do see some projects lowering their prices!

Raimon Land as an example