Investor Incentives

[Enza T]

My husband and I have invested in real estate in Melbourne and are now looking at purchasing property in Newcastle. We share an interest in real estate and I am fortunate enough to be working in the industry. I am the Accounts Manager for Rentals and Strata for a Real Estate office in Newcastle and have to admit that I love working in the industry. Our firm is considering setting up an incentive scheme for buyers, sellers and tenants who do repeat business with us, in the form of either a discount or a points reward system. I am hoping to get some feedback as to whether investors feel they would be inclined to use a Real Estate that offered such incentives.

 

[michaelg]

Hi,

Interesting idea, here's my 2.2c (GST included)...

The idea is to generate more business. To do so, you are wanting to make your business more attractive than other businesses.

At this point, the idea can go one of two ways;

1) The business owner understands that the customer does not want this "value added" service loaded into the price. If the item is inexpensive, keep it that way, the idea is to offer good price PLUS value.

Here the business owner understands that by absorbing a little overhead, they gain much more in repeat sales.

Whatever the incentive, this is the ideal approach (from a customer point of view).

2) Alternatively, there are those business owners that believe, that the customer should pay for every little service that business provides (or believes they are providing). This type of business owner feels that such incentives should be loaded into the price, to ensure profit is made at every opportunity. What this type of business owner fails to realise is that the customer has the power of choice. They can choose not to do business with them.

A customer may "want" to do business with a business owner, BUT a business owner "MUST" do business with a customer.

Ok, having said that, what you need to consider is "stuff" that doesn't cost you much, but has a great percieved value.

"Information that you already have, can be considered of no value to you, but of extreme value to an investor." Ie, a monthly newsletter, keeping them up to date on recent sales, new infrastructure, code/building changes, etc. Are stuff you need to know, but wouldnt cost too much more to email out in a newsletter to a "special customer database".

What you also need to consider is when is a lead a sale?

You need to consider when to give the incentives. eg. You dont want to be treated as a public library, more as a treasured resource, that only the select few have access too (increase precieved value).

How about the only agent in (whereever) that caters to non-local investors. Eg, you put together info-kits on properties you have listed included extra material to give the remote buyer a real good understanding of the market. Of course this steps into buyer advocate terriority.

Just a few thoughts
Michael G