Good things come out of tough situations.
Or so said Dave Myllymaki, sales manager at Vancouver-based New Tradition Homes. He was speaking of the recently completed cooperative advertising effort, “Buy New, Buy Now.” The campaign was organized by the Building Industry Association of Clark County, but was funded by 11 builders and three associated entities contributing $5,000 each.
The entire advertising campaign started last fall, when the BIA received a $40,000 grant from the National Association of Home Builders for a three-month print advertising blitz.
“We wanted to get the message out about what a great time it is to buy,” said Special Events Coordinator Ericka Carlsen, referring to low interest rates and a large inventory of homes on the market.
Carlsen said the mainstream media has focused on negative national statistics about the real estate market, but said regionally, things aren’t so bad. Clark County has a good employment rate and steady population growth, and according to Carlsen, the average house price in Clark County has not decreased much.
Although the average home price in the nation’s top 20 markets fell 9.1 percent, Clark County home prices appreciated 0.2 percent in the last year, she said.
When the print advertising run was over, five builders – who the BIA could not recall –came to the organization in January 2008 and broached the idea of doing a TV and radio advertising effort to “keep the message going.”
Within two weeks, the BIA had a website up and running and started contacting radio and TV stations.
Due to BIA’s nonprofit status, Carlsen said the radio and TV stations were generous. For example, KXL matched the complete advertising schedule, essentially doubling the amount of advertising the BIA could afford. KINK, KUPL, KHIT, and KGW NEWS Channel 8 offered significant discounts, special on-air interviews and complementary ads.
The goal was to reach 900,000 people three times a week.
“It was great to be able to pool our resources, especially in a down market,” said Moriah Diederich, Marketing Supervisor for New Tradition Homes.
Pooling resources, said Myllymaki, makes radio and TV advertising cost-efficient, versus print advertising.
Return on investment
The advantage of the advertising campaign to the builders was clear – the more people who heard the message, the more people who might buy homes. Other real-estate-related entities also helped fund the campaign, such as Riverview Community Bank – a BIA member.
“BIA members employ more than 10,000 people in this county,” said Scott Miller, Riverview’s senior vice president of marketing. “We felt a responsibility to support them and the positive message about housing in this area.”
While builders and Riverview might be concentrating on the “buy now” part of the message, it was the “buy new” aspect that interested Parr Lumber.
“This campaign was particularly interesting to us,” said Scott Ericson, regional sales manager. “There is a common perception that the quality of new buildings is less than houses built 20 years ago. That is absolutely not the case.”
The Buy New Buy Now campaign had a second part that “grew out of” the original campaign – that is, the first-ever Southwest Washington Tour of New Homes in April. The tour featured 41 homes priced between $180,000 and $1.4 million built by 30 different builders.
Participating builders paid up to $1,500 to join the tour, which Myllymaki described as “more down to earth and realistic for the majority of buyers” than tours like the Street of Dreams.
“My hope is that this tour will continue,” Myllymaki said. “It has the potential to replace the Parade of Homes.”
During the tour, participating builders received six offers on tour homes, but Carlsen wasn’t aware how many of those offers turned into actual sales.
Peter Glavin, president of Vancouver-based TaylorMade Homes, said the tour was well worth the investment.
Despite poor weather during the second weekend, more than 100 buying groups – couples, families or single buyers – saw TaylorMade product. “The fact that people are out and about, looking at homes, is a good sign,” Glavin said.
During the tour’s first weekend, “we had the most traffic and serious buyers I’ve had all year,” he said.
New Tradition’s homes saw similar increased traffic – double the normal traffic flow during the two tour weekends.
The company sold two homes in the weeks following the tour, but Myllymaki couldn’t say for sure whether they were a direct result of the tour by itself. However, he did say those home buyers toured the homes during one of the two tour weekends.
Myllymaki figured New Tradition’s advertising cost was about $35 per head – “far less than we would see for other marketing venues,” he said.
According to Regional Multiple Listing Service data, home inventory rates have dropped 30 percent in Clark County since the beginning of the year – from a 17-month supply in January to an 11.9-month supply in March.
Myllymaki said the effort had a solidifying effect on the industry.
“I like how builders have come together,” he said. “This is the right message to the community.”