Real estate: Developers turn to marketing firms to boost sales
Bengaluru/Mumbai: At a recent Mumbai fashion event, sales and marketing campaigns for two residential property projects were launched to an audience that included Bollywood actors and socialites.
The developers of the projects—Unity by Lotus Group, and The White Villa by St Angelo’s VNCT Ventures, designed by Suzanne Khan—had outsourced the marketing to real estate brokerage firm Sai Estate Consultants for a fee of around 15% of the project revenue. This is becoming increasingly common.
Property firms, which have so far relied on in-house sales teams and channel partners or broker networks, are forming partnerships with specialized marketing firms such as Anarock Property Consultants, Xanadu Realty and Sai Estate for aggressive sales as well as reposition and relaunch of projects, following a lull that’s lasted for over four years now.
With increasing competition and need for professionalism, many developers are outsourcing sales and marketing to large brokerage firms, said Amit Wadhwani, owner of Sai Estate, which currently oversees around 300 projects and also handles political rallies, medical camps and sports events for project campaigns. “Print and billboard ads help our brand recall but such events help customers to bring closer to my product. Brokers have to think out of the box,” said Wadhwani, whose firm works with 6,000 channel partners across Mumbai, Delhi and Dubai.
In April, Peninsula Land Ltd launched its first affordable housing project in Pune—1,000 homes in the first phase at Rs18 lakh onwards—with Anarock Property Consultants as a strategic partner.
Vice-chairman and managing director Rajeev Piramal says it’s tough to maintain steady sales in a competitive market and pricing alone doesn’t ensure sales.
For 1,000 homes, at least 10,000 leads or enquiries need to be generated to convert into actual sales and individual brokers aren’t enough to do this.
“In a slow market, sales are never steady and this is a large volume launch. Initial sales are always good and then they drop six months later. So we outsourced the sales to a specialised team with a focused approach. This will be the trend going forward just like we outsource design and construction,” Piramal said.
Since former JLL India head Anuj Puri founded Anarock in 2017, it has built a 1,300-member team where 7-10 members are dedicated per project. “Fresh launches are few today and developers need help to arrive at a fair sales price, appropriate project positioning with which we can go to the market to sell. It is driven by market research on projects in the vicinity, what buyers want and is arrived at mutually with the developer even though there can be arguments,” said Santhosh Kumar, vice-chairman of Anarock.
In April, Anarock formed a new channel partner vertical that will forge domestic and foreign alliances to create a large network. Kumar said this is not to eliminate the traditional property broker but to include and incentivise them to push sales.
But in the new regulatory regime, it is tough for mid-sized builders and small brokers to survive on their own.
Agnelorajesh Athaide, chairman, St. Angelos VNCT ventures said it is close to signing five sale deals at The White Villa following the event and in ‘Unity’, the new campaign triggered more leads.
“As we scale up our company and projects, we cannot reach every buyer on our own. We need to deal with customers in a more professional manner,” said Abhishek Agarwal, director, Lotus Group.
There is also pressure from bankers and investors to sell inventory through professional channels for better outcome.
Last year, Piramal Finance Ltd brought in its sales and marketing B2B vertical Brickex and Anarock to sell inventory in the luxury project 1973 Worli, where Piramal had invested around Rs1,400 crore in debt and equity.
Khushru Jijina, managing director of Piramal Finance, said the way sales were done in the good old days are over. “Recently, we wanted to sell stock in a project in suburban Mumbai within a week and for that Brickex did extensive research. We are not just lenders, but partners and want to help our developers in selling,” he said.
Centrum Real Estate Management and Advisory, a newly launched vertical of Centrum Group is in the process of tying up with a few developers for their projects, in various stages of construction. CEO Harish Sharma said that they will do sales and marketing, client management and help developers manage cash flows.
“We take distribution mandates post legal and technical due diligence. We will only take projects where financial closure can be achieved through a combination of debt financing and pre-defined sales velocity to ensure that the possession timelines are met as per RERA representation,” Sharma said.
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