By Carolyn Weber. Model homes can be a builder's greatest sales tool. They're a tangible way to demonstrate the company's capabilities and can also serve as a showcase for product and finish upgrades as well as floor plan options.
There are two sides to the buying psychology: logical and emotional. The logical side of the sale, things like location, schools, price, and size, has probably already been decided before customers even visit the community. But it's the emotional side, that intangible feeling that draws customers in and pulls at their heartstrings, that seals the deal.
"It's up to us to change the mood from logical to emotional," says interior merchandiser Mary Cook, president of Chicago-based Mary Cook and Associates. "The goal is for potential buyers to walk out of that model with all of their dreams seeming a little closer within reach."
Creating that attachment requires knowing your market inside and out and determining exactly what will appeal to buyers. Although the country's buyers, product types, and price points are extremely diverse, there are some hard and fast rules that apply to merchandising across the board. The following tips are just a few ideas on how to make your models work for you.
DO use color
Color is the easiest and least expensive way to create drama and impact with every target market. Bright colors work well in entry-level homes, while richer, more elegant tones appeal to move-up and luxury home buyers.
A fabulous color in a living room or bedroom will be most memorable, but even subtle accents in unexpected places are a useful technique. "Change colors below or above chair rails, between pilasters or moldings, on the back wall of a closet, behind built-ins, and definitely don't forget about the ceilings," says Cook.
It's important to acknowledge color trends, but even if pink is all the rage, think twice about a bubble gum hued kitchen or bath. Stick to an accent item like a throw pillow or curtains. If you're not sure what the hottest colors are for 2003 and beyond, check with the Color Marketing Group, color and design trends forecasters, at www.colormarketing.org.
DO show upgrades
Selling options and upgrades is a great way for builders to increase margins considerably. In fact, new-home buyers spend an average of $30,000 on upgrades. But they can't fall in love with those hardwood floors if they can't see them, so modeling homes with fine finishes and interior architectural features is imperative.
"Assuming that buyers aren't interested in 'decorator items' is a big mistake," says Don Anderson, president of Color Design Art in Pacific Palisades, Calif. The Meyers Group, a residential real estate information research company, recently released a study in which 53 percent of new-home buyers surveyed said they would be willing to pay extra to get the bookshelves and crown molding that they saw in the models.
Those kinds of upgrades, along with decorative ceilings and fireplaces, can make even a lower-priced home feel customized. Spend the time and money on kitchens and master baths by offering a few luxury items such as a fireplace to make it feel like a cozy retreat. "But never let the finishes overpower the design of the home," warns Anderson. "The big mistake is using materials and finishes that are inappropriate to the market."
DO show floor plan options
Modeling floor plan options seems like a no-brainer, but many builders don't fully exploit what can be a huge profit center for them. Often it is tough for a buyer to envision that optional loft/fourth bedroom or super bonus room over the garage, so you've got to show them. "Splurge on expansion possibilities like lower levels and attics," says Cook. "Finished out, those spaces can be a big perceived value boost for potential buyers."
Get in touch with the interests and hobbies of your target market and design the flex rooms accordingly. A decked out game room, home theater, workshop for dad, artist's nook, home office for mom, or scrapbooking/crafts area is a great way for buyers to imagine themselves living and playing in the house. "You've got to demonstrate unique floor plan options to capture buyers' imaginations as well as their pocketbooks," Anderson remarks.
DO court the kids
Kids are influential family members in the home buying process. They establish immediate attachments to spaces designed specifically for them. And, if a fun and playful room captivates them, they may give mom and dad more time to spend in the model. "Kids' rooms are the one place we try not to glue things down," says Joyce Mason, vice president of marketing for Pardee Homes. "We leave the toys free so they can play."
So go beyond bedrooms to model tech areas complete with desks and storage and bonus areas with separate media centers for kids only. For theme ideas be sure to tap into the latest youth oriented music, movies, books, and television shows.
Do take cues from retail
Retailers are the masters of creating the ideal lifestyle and then providing the goods to help people achieve it. Because new-home merchandisers are also in the business of selling a dream, popular home stores have always been a source of inspiration to them. "We pay a lot of attention to retail catalogs," says Andrea Hurt, president of Marc Michaels Interiors in Winter Park, Fla. "And we read every shelter magazine out there."
Today's sophisticated consumers are deluged daily by catalogs and exposed to all levels of design in magazines and on television, so most have a clear vision of what they want their home to be. "At the entry-level we are seeing a higher level of design quality and sophistication because our buyers are shopping at Pottery Barn, Crate and Barrel, IKEA, and even Target, where they can get Michael Graves coffee tables," says Anderson. "Even The Home Depot is selling Ralph Lauren paints and woven wood blinds that were once only seen in more expensive homes."
Creating looks that consumers can re-create in their own home makes them feel like their dreams are within reach. But don't try to recreate the catalog in the model, a few recognizable pieces should do it.
No nos of merchandising
DON'T skimp on accessories. Of course, the most successful models look as if someone really lives there, so don't blow the entire merchandising budget on furniture and draperies and forget about the accessories. "Set aside about 10 percent," says Andrea Hurt of Marc Michaels Interiors. "And not just for lamps, rugs, or art, you need personal things like family photos, kids' awards and trophies, and a pet bowl in the laundry room."
DON'T create an interior that doesn't relate to the exterior. In other words, don't design a traditional colonial interior for a Mediterranean house. Continue elements of the exterior inside to make the entire home design cohesive. "Bring masonry elements from the exterior to the interior on a family room fireplace or add rough-hewn beams to enhance a Tuscan-style home," notes Ava Carberry of Color Design Art.
DON'T design for yourself. Always remember that you are not the buyer. "Never let the personal tastes of a few key people within a company dictate the theming of an interior," says Jenny Kennett of Design Line Interiors in San Diego. The eyes and minds of the entire team should always be squarely on the target market.
DON'T ignore outdoor spaces. With precious little free time and the ongoing nesting trend, buyers want usable outdoor areas for living and entertaining. This is important space that can add value to the home price. Experiment with upgraded hardscaping and quality outdoor furniture. And remember to unlock the back or side doors of the model, so that customers can get the full outdoor experience.
DON'T neglect the men. Although women may 'ooh' and 'aah' over the decorating, and they are usually the primary influences in buying decisions, don't forget about the men. There should always be a special space for them whether it's a basement billiards space, a masculine wood paneled study, or an outdoor kitchen with a top-notch barbecue.
On a Budget
Merchandising can be pricey, ranging from $16 to $40 per square foot, with an average price of about $25. So, if a builder can't afford a half dozen fancy models or a design center, using vignettes or building just one model is always an option. But there are even simpler techniques these days, and it may be time to get virtual.
Several options selections vendors provide software that allows buyers to see all the various products and finish options and how they will work together. "We take what would be a conventional design center and put it online," says Howard Weiner, president of Builderfinish.com in Chicago. "We can present floor plans, interior options, and exterior options." With Weiner's product, buyers simply click onto the builder's Web site and flip through the floor plans and options.
Builders can use the product in lieu of a design center or set up kiosks in the sales center to work in conjunction with the salespeople. "It works as a pre-sale tool to communicate the breadth and depth of the builder's customization programs," Weiner says. "And after the purchase, buyers can do the research and planning at their own pace."
Builderfinish offers two programs. One, for larger production builders, charges by the floor plan with a set-up fee of $2,500 to $4,000 per plan for the first year and $500 a year to renew. For smaller builders the company offers a generic plan in which buyers can try out products room by room. It costs $125 per project per year or $2,000 for unlimited projects per year.
Once they are set up, both programs are self-administered by the builders who can then customize them further by adding products, changing products, or changing prices. There are other vendors who offer this type of software, including Focus360, BuildView, Options Online, and Your Design Center Inc.