Luxury Real Estate Marketing: Is Customer Service a Luxury?

“The greatest danger for a luxury firm is to lose its status as a differentiated, premium brand, but wealthy consumer perceptions suggest that luxury overall may be in danger of losing its cachet,” said Milton Pedraza, CEO of the Luxury Institute. “This calls for a renewal of efforts to be unique and exclusive and to execute well on customer service.

The most frequently cited qualities that define luxury-superior quality (76%), craftsmanship (65%), and customer service (57%) – are the areas where wealthy consumers are finding the greatest dissatisfaction. More than half (56%) say that craftsmanship of luxury products is on the wane; 51% say that quality is decreasing; 50% notice a slippage in customer service quality and 48% say that luxury products are losing their design value.”

How does this apply to luxury real estate marketing? Real estate as a profession is a service business, real estate agents and brokers are service professionals. As we interview agents across the country for our series 50 Top Luxury Markets in the USA, we find that those who respond immediately to our queries are thriving in their marketplaces and those who want to eclipse the market leaders. They are easy to access, willing to share their insights, passionate about their marketplace, return calls and emails promptly and are a delight to talk to. One of the top market leaders recently interviewed said that you have to be nice to everybody regardless who they are or what their status in life. He returns everyone’s calls personally. As a result his client lists grows and referrals are plentiful.

Many of the agents we interviewed who are market leaders did not have websites, do not engage in social media, and do not know or care what SEO means or being #1 on Google. They are differentiating themselves on service, manners and excellent communication skills. They knock on doors; they meet people day in and day out. They are relationship oriented. They network face to face. They practice the fundamentals of business. They water plants for their sellers when they are out town. They send handwritten notes, birthday cards, and take their clients out to lunch. Tech is not the priority focus in their success equation and in many cases has been relegated to the back burner.

Luxury by definition implies rarity and exclusivity. Given the results from the Luxury Institute, it is evident that customer service is a key indicator in choosing a brand/service professional. People will remember you for your luxurious service. In our practice as branding and marketing strategists, we feel that customer service should take priority, and technology should facilitate customer service.

Personal Branding For Real Estate Agents – Promote Your Marketplace More Than You

As a luxury real estate marketing professional it can be strategically advantageous to anchor your locale as a major component of your personal brand identity. Doing so can add significantly to the emotional appeal of your brand because it promotes the fact that you an ambassador of good will in your marketplace. Promoting your marketplace more than you demonstrates your marketing expertise and sells you in the process.

Here are examples of luxury brands that incorporate geography in their marketing strategy and how it can be applied to personal branding for real estate agents:

Donna Karan New York-DKNY

DKNY produces clothes for men and women targeting the urban chic crowd.  In a recent article in Interview Magazine, Donna Karan explains: 

“When Donna Karan started, I didn’t like the name Donna Karan. I had a real problem with it. I was so used to designing under somebody else’s name that I didn’t want to go out there with my own. I’m sitting in the kitchen, and I see the name “Maud Frizon/Paris, London”on a shoebox. I’m thinking, “That’s cool. What about Donna Karan New York?” Because it won’t be about me. It will be about New York City. Why New York City? Because New York City says the world. I wanted an international brand. Donna Karan’s just another boring name. I want everything to be about New York people living. I mean, everybody relates to New York as a bridge to the world. So that’s how New York came in.”

Donald Pliner

Donald Pliner produces shoes targeting the higher end of the casual market: The company slogan, “Made in the Mountains of Italy”, (not just Made in Italy) connotes a relaxed place where shoes are well made, unlike an industrial venue where high production quotas are more important than high quality.

Lindt Swiss Chocolate

Chocolate from Switzerland evokes the feeling of the beautiful Alpine mountains, the concept of precision and excellence, so you just know the chocolate is going to be great!

The Downtown Crowns 

A downtown San Diego mother-daughter luxury real estate team, the Downtown Crowns are experts in promoting their marketplace through their popular blog. The Downtown Crowns are very active participants in their community. They understand the principle of “promoting your marketplace more than you”. And, their brand is a clear example of geographic branding as it applied to personal branding for real estate agents.

The United States is replete with geographical gems. Which one is yours and how can you demonstrate your marketing expertise by promoting your marketplace more than you?

Seller Financed Real Estate Deals in Today’s Market Conditions

With stricter banking regulations because of fluctuating economic conditions and an unsteady real estate marketplace, real estate sellers today are carrying back private funding to make their property more salable. When an individual seller or broker finances a transaction out of pocket they are acting as the lender. This is beneficial to the process because the buyer doesn’t have to go through a rigorous approval process, which can prove to be very tedious because of the heightened banking standards today.

Over the past two years, the central bank has conducted several in-depth surveys of U.S. banks. The most recent survey of 55 U.S. banks’ current lending practices and standards revealed that the percentage of banks reporting tighter standards is near historic highs. One of these, found that about 75% of the banks surveyed indicated they had tightened their lending standards for prime, subprime and commercial mortgages. That was up from about 60% in the previous survey.

The Fed’s July survey covered 52 U.S. banks which hold about 80% of the residential mortgages on the books of all commercial banks. The Fed survey found that only seven of the banks said they were still participating in subprime mortgages, loans made to borrowers with weak credit histories. Of those seven, six said they had tightened lending standards on subprime loans with only one saying it had left standards basically unchanged.

Any experienced private lender recognizes this as an opportunity to salvage an unfavorable situation and turn it into a positive one. By utilizing seller financing, sellers can sometimes end up getting more money for their property and collecting interest on top of that. Seller financing can enable homeowners to receive the best selling price despite bad lending conditions. In addition, a home buyer with poor credit is able to become a home owner. It’s one of those rare situations where everyone at the negotiating table gets what they want!

Many real estate sellers never consider seller financing because they don’t understand the advantages or the process. There are also common misconceptions that it’s much too complicated to attempt to put together a seller financed deal, or that there are no buyers willing to sign a private loan. Not true! Once a seller takes the time to learn about the basic process and the advantages of offering private to sell their property, the benefits become very clear: bigger buyer pool, easy loan approval process, and a much quicker closing. Plus, a little education about seller financed loans will make it apparent that drafting a secured private loan is actually a very straightforward process.

The bottom line is seller financing can enable a real estate seller to get the best of both worlds: selling at the desired price, closing the deal quickly, and even receiving additional income from interest payments that the buyer makes.