The modular home building
business has been turned upside since the housing crisis hit in 2008. Many
builders, both large and small, folded up their tents and quit. Many others
went bankrupt and those that managed to stay in business through the tough
years are finding a changed world.
Here are 5 things
that modular home builders need to adapt to if they are going to weather the
good times now heading your way.
1. Small builders vs large
public builders.
The large public builders
like Ryan, Toll Brothers, etc, are becoming even more aggressive than they were
prior to 2008. During the recession years they hoarded cash like the crazy lady
down the street hoarded cats and are bringing it out by the bucket loads now.
Gen Y and Gen X buyers are being wooed to new age appropriate developments and
Boomers are seeing more age restricted developments than ever before.
Small modular home builders
can win some battles by doing things the large tract builders can’t. Go after the scattered lot crowd, emphasis
your custom design capabilities, use referrals effectively and become
ninja-like in your marketing approach.
2. Have you heard about social media marketing?
You can bet the big guns in
housing have. Everywhere you look ads for
show up. It is not unusual for them to get over a million impressions a
day! Some of the big tract builders have
marketing departments that work Facebook, Twitter, Pinterest and others full
time. OMG! Even Blu Homes is using part of their $65M investor money to work
social media.
You have got to take more
than a fleeting interest in social media. That’s where your prospective buyers
are. Forget the Yellow Pages, the newspaper ads (Gen X and Y don’t read them
anyway) and when was the last time you saw a new billboard being erected. Take
some time and learn how to promote your company on social media. You need to
make some impressions.
3. Going Lean and Green
Energy Star, Passive House,
LEED, Net Zero, building envelopes, IAQ are just some of the terms being used
by today’s savvy new home buyer. They expect a tight house, low energy bills
and earth saving materials in their new home. They eschew large two story open
spaces. Local, state and national building codes are getting tougher and it’s
taking longer to get design approvals and inspections. You need to be aware
that your buyer is probably as well informed as you about the new energy stuff
on the market. It’s your responsibility to rein in their dreams of saving the
planet when they build with you. Neither of you can afford it.
4. Don’t forget your customers after they move
in.
Not keeping in touch with
your customers when they call about the light switch not working, a loud noise
coming from the toilet or a garage door opener that stopped working will send
your customer right to Facebook, Yelp or Ripped Off. If they can’t get you to return their emails
or calls, they will usually call your factory and complain. Trust me, you don’t
need that hassle. Factories do not like being brought into problems that are
the builder’s problem and not theirs. Where do you think referrals come from?
5. Choose your battles when
it comes to pricing.
If your idea of winning over
customers is to assume that price is the only thing they care about, then you
need to get out of the new home business and start selling used cars. Using the
least expensive materials and bare minimums from the factory will mean that
just about everything the customer wants will cost them an arm and a leg.
Consider offering your homes
with a standard energy saving package included in your base price. It might
include better insulation, better windows and foundation insulation. Offer
upgrade packages for kitchens, baths, flooring, heating and maybe even
fireplaces. These packages would include a selection of options that many of
your buyers have chosen in the past. Easy to do, hard for other builders to
figure out what you’re doing.
