Custom-built condos?

When his daughter was quite young, struggling new parent Stan Kates, president of the Kates Marketing Group in Toronto, wanted to make life easier for working parents like him and his wife. He created a concept called Rainbow Village, a condominium development for working parents complete with a daycare and evening care centre, a toy exchange, playrooms, an on-site summer camp and doctor's office, to name a few of the amenities.
Even though no product existed, he took an ad out in the Toronto Star and encouraged interested prospects to fill out a coupon with their personal information, including address, income, current rent, price range, desired location and age of children.

When his daughter was quite young, struggling new parent Stan Kates, president of the Kates Marketing Group in Toronto, wanted to make life easier for working parents like him and his wife. He created a concept called Rainbow Village, a condominium development for working parents complete with a daycare and evening care centre, a toy exchange, playrooms, an on-site summer camp and doctor’s office, to name a few of the amenities.

Even though no product existed, he took an ad out in the Toronto Star and encouraged interested prospects to fill out a coupon with their personal information, including address, income, current rent, price range, desired location and age of children.

Kates received 500 responses – more than enough to find a builder to make the project a reality. In the end, the development sold 633 units within 11 weeks.

It’s a story he’s told dozens of times, but it’s one that Kates says epitomizes the promise of target marketing. Slowly but surely Canadian condo developers have completely turned the ‘build it and they will come’ adage on its ear.

Sophisticated database marketing techniques – many of which are conducted online – are permitting condo marketers to target specific consumer groups – from single moms or pet owners, to newly wed professionals and everything in between.

And increasingly, it’s allowing potential home buyers to call the shots. Consumers can essentially provide developers with their ideal specifications – location, size, amenities, price.

‘That’s how it should be done. Most builders build because they’ve got a piece of land, a bank is willing to finance them, or an architect thinks he knows how to produce something better than the guy down the street,’ says Kates.

‘We search the database for new concepts or themes for condos. I’m doing one now for people who work at home. We’re using the database to create new products for the marketplace.’

In September Kates launched the Preferred Home Buyer Alliance, a Web-based online registration database for qualified people interested in buying a home. He plans to use traditional advertising and the chance to win $200,000 toward your dream home to attract people to register on the site (www.preferredhomebuyer.com). To date, the database counts over 2,000 interested Torontonians, who have volunteered about 200 points of information each, based on dynamic questions during the registration process.

‘My understanding is that it’s the largest database ever accumulated online, in terms of the spread of information that we’re now able to mine,’ he says. ‘This database can be applied to many projects, not just one. We can use the one database to do research, or online focus groups, to understand what the market wants, but also to do specific marketing initiatives for individual development projects.’

Kates says he’s looking to develop the database to about 15,000 in the city of Toronto over the next year. He also eventually plans to expand the program to Vancouver, Ottawa, Calgary and the U.S.

The database service is available to builders on a project basis, allowing them to market to specific niches or groups on a pay-for-performance basis. (Kates will take a cut of each sale generated by the database.) He is already working with 50 clients.

Most builders, he adds, don’t know how to use the information and data they get from a previous project on the next one.

However, some builders who have been in business a while are in fact relying nicely on their own databases, says Jim Ritchie, senior VP, sales and marketing of Toronto’s Tridel. Tridel has amassed a database in excess of 80,000 names through on-site and online registration. The real estate developer is renowned for its successful permission-based e-mail marketing campaigns and online contests that act as incentives.

‘We try to push everyone to the Web site first so they can get information and so we can gather it from them,’ says Ritchie, adding that traditional advertising vehicles, like on-site signage, print ads and billboards, in conjunction with a promotion or contest, are used most often to drive Web visitors.

That’s true of most condo marketers today, says Diana McMeekin, president of Artemis Marketing Group in Vancouver, adding that the Internet has proven invaluable when it comes to follow-ups – now done via e-mail – and information gathering. She’s used teaser campaigns (on- and off-site billboards) with Web addresses in the last several projects she’s worked on. In fact, a phone number is no longer provided, she says.

The ads are usually designed to intrigue a certain set of people. ‘It’s a message – often the ads don’t even include the product – about how you feel if you buy one of these: your attitude and lifestyle. It might have one line in there saying ‘Coming soon…’, or no line at all, but it will say www.CondoA.com,’ she says.

Once users arrive at the site, they can learn about the product (without ever having to visit a sales office), and register for more information, says McMeekin. Internet technology and sophisticated database marketing is also allowing developers/marketers to ask more interesting questions.

‘People will tell a computer a lot more than they will a person about their personal likes and dislikes. In the old days, you’d have a registration form that had name and address, phone number and what you’re interested in – 1, 2 or 3-bedroom – price range, and when do you want it?’ she says.

‘Those were always the boiler plate questions. And while we still ask those questions, we now ask a lot more about the fabric of a consumer’s life – what do you do for fun, favorite restaurant – fun stuff that relaxes them. And we find out a great deal more about who they are, what they like to do and thus what will intrigue them more about our product and how we should position it. It’s an incredible insight and a very powerful resource.’

And it doesn’t stop there – follow-ups can be tailored to individuals. Repeat builders can also leverage the database moving forward, says McMeekin, adding that one of her partners currently has a database of approximately 1,000 people, with which it keeps in constant communications via e-mail.

‘It’s not just a database of information. We’re nurturing these people – we send them information relevant to them in their house-buying process,’ says Kates.