Wednesday, November 25, 2009

Happy Thanksgiving

The First Thanksgiving. Painting by Jean Gerome Ferris

Once again we are at that time of the year that we take a break and celebrate the Thanksgiving holiday. It is one of our favorite holidays because we pause to notice everything we are thankful for, and draw strength and pleasure as we reflect on the world around us. This is also our moment to thank all the readers of the LOL Blog. We especially appreciate your comments and discussions.

We wish you and your loved ones a very happy Thanksgiving.

Cheers to your continued success!

Ron and Alexandra Seigel

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Tuesday, November 24, 2009

Reputation Outperforms Google Ranking

As a luxury real estate marketing professional it is even more important to be the Google of your marketplace (the first to come to mind) than it is to rank #1 on a Google search results page. The world famous restaurant, Lawry’s –The Prime Rib, in Beverly Hills, California, over 70 years old, exemplifies this essential principle of branding. You may not have been to one of Lawry’s restaurants (now with multiple locations around the world), but you may recognize the ubiquitous Lawry’s Seasoning Salt brand found in most markets in the US today.

Growing up in West Los Angeles, Ron was fortunate to be a close friend of a granddaughter of the Lawrence Frank family. The family still owns the restaurants to this day (they sold the condiments business several years ago). Their first restaurant opened in 1938. For many years it was unique among restaurants because they just featured one entrée on their menu: standing rib roast. This was their uncontested market niche. Many restaurants copy their style, but Lawry’s still does it better than any other restaurant. And, their passion is palpable.

In 1953 Lawry’s added something special. Their menu claimed to be "the first to feature a green salad as an integral part of every meal." The salad bowl is placed on a bed of ice and spun by the server while she shakes the bottle of salad dressing and ceremoniously pours it into the bowl from about two to feet above the bowl. This ritual is a unique part the restaurant’s brand identity, in the same way that consistently and promptly, answering emails and phone calls can be a part of yours.

In 1956 just prior to the playing of the 1957 Rose Bowl Game between the Oregon State Beavers and the Iowa Hawkeyes, Lawry's entertained the two competing teams. This started an annual tradition of hosting a prime rib dinner for both of the teams bound for the Rose Bowls. By the early 1960s, the event had become known as the "Lawry's Beef Bowl." It is often covered by the media.

If you Google “prime rib restaurant in Los Angeles” all ten search results on page one refer to Lawry’s -The Prime Rib. They do not have an SEO strategy. The 9 results that follow their number one ranking on page one are all social media/restaurant reviews citing Lawry’s as the best prime rib restaurant in town. Lawry’s does not have a social media strategy. What they do have is an impeccable reputation and the mind share of the market leader. They occupy the #1 place in the minds of their target market: Prime rib lovers.

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Monday, November 23, 2009

Luxury Real Estate Marketing: Creating Customer Loyalty Offline

We are often asked by luxury real estate marketing professionals for some low cost, off-line vs. online, marketing strategies that produce high impact marketing results, especially client loyalty. We like to encourage our readers and our clients to think about what makes them loyal customers and clients of other professionals. Here are some ideas along those lines.

Recently we visited our local produce market. They often carry items that we cannot find in the outdoor Farmer’s Market. There was a sign posted at the entrance encouraging customers to bring their own bags. They launched a new initiative to contribute a nickel to one of four local charities when you save them the cost of a paper or plastic bag. When you check out they give you a ticket to place in one of the four boxes associated with the charity of your choice.

Many times you see a box at the checkout stand for a particular charity where you can deposit your coins or dollars. But, it is usually a national charity, not a local community charity such as the Girl’s Club, the local food bank, etc. There is something so wonderful about being able to simultaneously contribute to the environment (recycling bags) and also to a local cause here. It makes you feel good about yourself and about the store, thus generating customer loyalty. What was the price of our loyalty? It was five cents!

Later, the same day we purchased a hair care product from a local pharmacy. There are many choices in our neighborhood to find the same product. In fact there are many branches of the same company in our area. On this day, when we checked out, the clerk noticed that a coupon was available for the product we purchased and proceeded to cut it out of the paper for us. It saved us two dollars and made us feel very good about shopping at that particular store again. What was the price of our loyalty? It was zero—just 30 seconds more of customer care!

What are some of the ways your local stores and services are winning you over as loyal customers? What are some of the ways you can engender client loyalty at zero or next to no cost?

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Friday, November 20, 2009

Luxury Real Estate Marketing: Jumping Off the Internet and Jumping On Your High Horse

Grace Sabeh, Executive Homes Realty, in jump competition

The mantra these days for luxury real estate marketing and real estate marketing in general is: focus your marketing on the internet. However, luxury real estate marketing professional should think about other venues of marketing. Your target market is not on the internet 24/7, and they do participate in all kinds of activities besides surfing the net. How about sponsoring a luxury event, in your marketplace? Here are two examples of event marketing. One is famous luxury brand that is thinking strategically in a time when retailers and luxury brands are cutting back their budgets. The other is a market leading luxury real estate professional who followed a hunch with event marketing that paid off very well, indeed.

The Luxury Brand

Hermes is one of the finest luxury brands known for their uncompromising craftsmanship. They started as a saddle shop in Paris in 1837. Because of their exquisite work and their royal clientele, they became known as the “saddle makers of kings.” Since then they have expanded into fashion, lifestyle and home products.

Recently they announced their return to their equestrian beginnings by sponsoring an equestrian event and competition. This is a revival of the first jumping event that was originally held in the Grand Palais in 1901. The event drew the fashionable crowds of Paris and its environs. By 1957, interest waned and the event was discontinued. Now, by sponsoring Saut Hermès (saut means jump) they are strategically placing themselves in plain view of their target market. No doubt, they will issue a limited scarf edition that will honor the event. This will help to reacquaint existing customers with Hermes’ equestrian roots and reaffirm their loyalty to the Hermès brand. Additionally, Hermès has become involved with a horse race held every summer in Deauville, as well as with an international dressage competition Equita’Lyon, held in Lyon, France.

The Luxury Real Estate Agent

One of our clients listed a home owned by a car collector. Based on the design of the home, the ideal buyer would also a collector. As a strategic move, she rented a billboard that showcased the home at the prestigious Concours D’Elegance car event in Pebble Beach, California, where her target market would be a captive audience. She not only sold the home to an attendee of the event but she also attracted several leads for other sales.

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Wednesday, November 18, 2009

Luxury Real Estate Marketing: Is It Worth It?

Photo by Jorge Barros

In staying up to date with the new theories of luxury marketing in the global economic downturn, it seems to us that there is a denial, among the purveyors of luxury goods and services, about how consumers are now viewing luxury. The same holds true, in many cases, with sellers of luxury real estate. As we read the various reports and the advice from industry pundits, we are struck by the level of delusion that continues to characterize the industry. Many home sellers are refusing to price their homes in line with current consumer demand.

In retail, some advisors say, “Do not lower prices of luxury goods and services”. The fear is that this may tarnish the brand’s reputation. In the perfume industry, one solution is to sell perfume in smaller bottles, giving consumers the illusion of lowering prices. Have you noticed that store bought coffee usually comes in 12 once bags these days instead of 1 pound bags?

The hospitality industry is also attempting to maintain their prices while adding incentives such as food and spa credits which effectively lower the rate of the rooms. Consumers are not jumping at either offer.

The high end consumer is rejoicing at all the sales. Finding bargains has become a badge of honor. Waiting for items to go on sale has become a new national pastime. Most importantly, consumers are beginning to ask these important questions: Is this item worth it? Do I really need it? Do I have to have it at this price?

As soon as more homebuyers wake up to the new perception of value in the luxury realm, more luxury real estate marketing professionals will start to see significant momentum in their sales.

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Tuesday, November 17, 2009

Luxury Real Estate Luxury Marketing: Redefining the World of Luxury

Denali mountain aka Mt.McKinley national park service photo

As a luxury real estate marketing professional it is very important to tune into the new psycho graphic trends and changes that luxury consumers are exhibiting during current market conditions. Understanding the mindset of all-cash buyers, in particular is now an imperative. They are the ones who determine the purchase prices in today’s market. Aligning the thinking of your sellers with these viable prospects can significantly increase your volume of business.

Have you noticed that the price of name brand shoes from Italy have increased in price faster than changes in the exchange rate between the dollar and the Euro and also faster than increases in the cost of living itself? Assuming for the sake of this discussion that the cost of labor, materials, marketing and other cost are held constant over the past several years, where is the extra value coming from?

These and many similar questions are now being asked by affluent consumers who are re-examining their own personal values when it comes to purchasing luxury goods and services.

We recently attended the NAR conference in San Diego, California and came away with an interesting insight inspired by an agent from Fairbanks, Alaska. She mentioned that the highest priced luxury homes in her town are selling in the low $400Ks. Her personal residence, a six wooded acre estate with a spectacular view of the Denali mountain range is valued at $200K. And, the market is active, contrary to other markets in the US.

In Alaska you cannot get away with sub par construction given the rigors of the climate. Construction costs are certainly not less than in California, for example, and labor costs are higher because the labor pool is limited.

Clearly, luxury is value added to basic costs of manufacturing (and land n the case of real estate) which makes it completely subjective. Like all-cash buyers consumers therefore, are beginning to realize that they dictate the terms of the value added rather than sellers now that there is an abundance of choices. In our previous market we had a false condition of scarcity that was fueled by the competition of easy money and the ensuing escalation of unrealistically inflated prices. The inflated false value was non-sustentative. And, this is what consumers are now re-evaluating.

A top agent in downtown San Diego sold a high-rise condo unit, with sensational views that are permanently unobstructed, listed at $1.2M two years ago, for half price. This all cash buyer determined the value despite the developer’s insistence that there should be a premium of $50K per story, arguing that the higher the floor, the more value it can command. Was there actually value added between that floor and the one above? Consumers now make that value call as they redefine luxury on their own terms.

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Friday, November 13, 2009

Luxury Real Estate Branding: Empower Your Silent Salesperson

photo by Shawn Lipowski

Venus de Milo in the Louvre,aka Aphrodite de Milo

Considered One of the Finest Examples of Classic Greek Sculpture

How important is aesthetics in presenting your luxury real estate marketing services? The answer is: very important. In fact, aesthetics represents an entire branch of philosophy dealing with the nature of beauty, art, and taste. The aesthetics of visual presentation can be your “silent salesperson” and play a much bigger part than you may realize in the success of your luxury real estate practice.

There is a whole psychology of color alone; certain colors evoke very predictable emotional responses and personal values judgments of sentiment and taste. That means you can connect with your target market on a deep emotional level by incorporating the right aesthetics in your personal or company brand. What are the right aesthetics? The right graphic images are those images that represent your authentic brand.

If you neglect this essential component of brand strategy you are missing an extraordinary opportunity and you are vulnerable to potential competition. We live in a new online world where you have a nano-second to make a strong first impression and engage your website visitors through the emotional connection of aesthetics.

Think of walking down Madison Avenue in New York or any major retail street in cosmopolitan cities that feature luxury stores. Window displays must grab the attention of potential customers or they just walk on by. Now, think of the speed at which a website visitor, with a single click of their mouse, can move on to your competitor’s site.

So much attention has been paid to driving traffic to your website. You may be spending considerable time and money to get potential buyers and seller there. But, are you engaging them with the power of aesthetics when they arrive?

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Wednesday, November 11, 2009

Luxury Real Estate Branding: Leaving the Plastic Flamingo Flock Behind!

Imagination and creativity is one of the cornerstones of a successful luxury real estate marketing practice. Imitation and luxury really do not belong together. Too often we see luxury real estate professionals copying the branding or marketing strategies of their closest competitors and forgoing the competitive advantage of being original and authentic. It becomes a case of the hot pink plastic flamingo!

One of the most beautiful birds on our planet is the flamingo. This brightly colored bird caught the imagination of Don Featherstone who designed a plastic hot pink flamingo as a lawn ornament, sold in pairs (one upright the other feeding.) This plastic creation was awarded the “Ig-Nobel Prize for Art (a parody of the Nobel Prize). Plastic pink flamingos have become part of the American pop culture. Original Featherstone’s are marked as such on the bird’s underside.

American Flamingo, Photo by Fritz Geller Grimm

However, copy cats swarmed in and reproduced the flamingos in mass. This caught the imagination of students at the University of Wisconsin who “flamingoed” (the verb) a hill near their campus with over 1000 plastic flamingos on the first day of classes one year. Their prank sparked similar episodes around the country.

Plastic flamingos are now considered in the art world as kitsch. " Kitsch is a German word denoting art that is considered an inferior, tasteless copy of an extant style of art or a worthless imitation of art of recognized value."

Authenticity in personal branding will strike the right chord with your ideal clients. Phoniness will repel them like plastic pink flamingos. It is not that there isn’t a market for these hollow birds. It is just a question of knowing who you are and who you want to attract.

Is your personal brand original or is it kitsch?

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Tuesday, November 10, 2009

Authenticity vs. Masquerade in Luxury Real Estate Personal Branding

Authenticity is perhaps the most important concept in personal branding for luxury real estate marketing professionals. Without authenticity, you live in a masquerade. What is at stake if you forego authenticity? Quite simply, it is your own happiness.

Recently, Andre Agassi published an autobiography in which he admitted to be caught up in a masquerade. He was forced by his father, who recognized his extraordinary talent, to become a champion in a game that Agassi would come to hate. In his recent TV interview it was obvious that he suffered a life of quiet desperation during the time when his brand was perceived as being the “rock star of tennis”. Canon, the camera company, capitalized on his brand image of being a rebel (which was the brand name of one of their models).

Reactions have been mixed from his contemporaries and fans. Resentments have been expressed by some. At the root of these resentments is the feeling of having been duped by Agassi’s charade.

Many people might say that this is a sign of the times. But, there is a deeper lesson to be learned, which is what Agassi, the staunch supporter of education, is now trying to tell the world. That is, there may be much to gain by living a fake existence, but in the long run it is your own happiness itself that is at stake.

As brand strategists, it is our job to assist our clients to drill down to their core identity, identify what is truly important to them, what they stand for, what their genuine values are, not the values of others. Only then can you make explicit, in the form of a graphic representation and a genuine marketing message, the authentic personal brand.

We ask our clients what they can do better than anyone else in their marketplace. But, they also must be truly passionate about doing it. An authentic pursuit cannot be one based on seeking the admiration of one’s father or the crowd at large.

It was only when Agassi admitted to himself that he was caught up in a masquerade that he shaved his head and discontinued wearing a wig (his mask). He chose tennis on his own terms and became passionate about the game. No one can minimize his extraordinary accomplishments. But, the best accomplishment of all was choosing an authentic life.

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Friday, November 6, 2009

Attract More High Net Worth Clients with Abbondanza! -the Abundant State of Mind

The most successful luxury real estate marketing professionals have understood and acquired a mindset that matches the general state of mind of their typical clients. As a result, they attract more high net worth clients than their competitors do. That way of thinking can be summed up in a single word that sounds even better in Italian than it does in English: ABBONDANZA! (Abundance)

The holiday of Thanksgiving is a celebration of abundance at harvest time that is often symbolized with a cornucopia, the horn of plenty or harvest cone. Here in Santa Barbara, California we are surrounded by agriculture and are thus very fortunate to have a Farmer’s Market six days a week, all year long.

This time of year is particularly exceptional. The market is overflowing with colorful organic fruits and vegetables that are truly a feast for the eyes. Shrimp and Pacific lobster, caught right off the coast, near the Channel Islands, is also abundant this time of year and sold at the market. Just walking through the market and appreciating the profusion of bright, multi-hued flowers can send you into a state of abbondanza.

Evidence of abundance is all around us if we take the time to appreciate it. Have you ever just stopped to appreciate having hot and cold running water and water that is safe to drink? We often take it for granted. Have you ever noticed the ever present power that runs everything in our homes including our computers? How do you feel when there is a power outage?

Here are some fun musings about the abbondanza mindset and the cornucopia:

Did you know that a cornucopian is a futurist who believes that continued progress and provision of material items for mankind can be met by similarly continued advances in technology?

In Greek mythology Zeus was raised by a goat and accidently broke one of its horns. Feeling bad, Zeus returned her horn with supernatural powers that would give whoever possesses it whatever he or she wants.

Perhaps that is what defines the abbondanza mindset of affluent consumers: They expect to get what they want. They are more optimistic than pessimistic. If you want to attract more high net worth clients, isn’t it worth getting yourself in the abbondanza state of mind? All it takes is the time to appreciate the abundance that is already in your life. You do not need to wait for Thanksgiving!

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Wednesday, November 4, 2009

Luxury Real Estate Marketing: The Secret Advantage of Being The Popular Choice

The advantage to being top of mind, as a luxury real estate marketing professional, in your marketplace is getting the lion’s share of the business. There is also a secret advantage of being the popular choice. Although, Cherry Garcia ice cream, from Ben & Jerry's, has many raving fans vanilla, chocolate and strawberry ice cream are by far the favorite choices with vanilla winning hands down as "most popular".

Ranking top of mind in luxury branding is even more important that ranking #1 on a Google search, because the overwhelming majority of affluent consumers rely on referrals from friends, family and colleagues when choosing products and services. Any real estate agent with enough funds can hire a search engine optimization expert to help him or her secure the #1 position in a Google search query. But, will the website visitor who clicks through the top listing actually hire the top ranking agent on Google at the end of the day if they are not accomplished and competent--or popular?

There is a lesser known factor that influences the choices of high net worth consumers when selecting a luxury real estate marketing professional. That is, taking into consideration what others will think of them based on the agent they select. While some consumers are “inner-referred”, meaning that they rely on their own judgment more so than others, a significant number of people care more about what others think of them. The “outer-referred” consumer will bypass their gut instincts (and taste buds if they prefer Jerry Garcia) just to look good in the eyes of their peers, neighbors or family (who prefer vanillla).

Have you ever been in a restaurant when the server suggests a menu item and adds, “This is a very popular choice”? Studies have shown that when it comes to choosing brands of food to serve at a party the host will purchase the “popular choice”, e.g., Coke vs.. Pepsi even if the host prefers the taste of a generic brand that is cheaper.

To summarize, if you want to gain or sustain market leadership you need to stand out and achieve “top of mind” status for three important reasons: 1) most potential referral sources can only remember a few brand names (vanilla, chocolate and strawberry) when asked for a recommendation for a luxury real estate agent ( see more detail on this); 2) Top of mind generates more leads than qualified search engine leads because affluent consumers rely on personal referrals more than Google, and; 3) The popular choice is a hidden influence in selecting an agent

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Tuesday, November 3, 2009

Luxury Real Estate Branding: Connecting through Emotional Branding

As a luxury real estate professional, it is important that your brand resonates emotionally with your target market. If you strike an emotional chord with potential clients and referral sources they will remember you much better especially if you tell a compelling story. Here are two example of what Pepsi has done to reach its target audience on an emotional level. One works better than the other.

This commercial is very funny, but did it connect with the people who are viewing it? Will they go out and be moved to buy Pepsi next time, because they identify with this story? Are there enough young people in ashrams practicing martial arts?

In contrast, this second commercial, produced a few years back, hits a bull’s eye. It also has a humorous side to it. However, it makes a strong emotional connection with its audience. Music is an important part of the lives of teens and young adult. This story also speaks to adults who grew up in the sixties and are still young at heart.

Do you remember the Pepsi slogan: “Come Alive—you are in the Pepsi Generation? Pepsi out-sells Coke in the younger demographic. They need to stay firmly on this sweet spot to continue this trend. The first commercial was nebulous about this important brand position which needs to be communicated and amplified with laser sharp precision in order to strike the right emotional chord.

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