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Yes, customers are responding to online outreach.

Graham Hughes is vice president of sales and marketing for Arizona-based Taylor Morrison.

Photos: Peter James Field/agencyrush.com

Graham Hughes is vice president of sales and marketing for Arizona-based Taylor Morrison.

I think home builders are spending their advertising dollars in a more impactful, meaningful way than in the past. Part of that stems from the housing slowdown, during which all of us needed to step back and take a hard look at exactly where we were allocating our ad dollars. Builders no longer could afford to “spray and pray.” Our marketing dollars needed to be spent more strategically.

The other catalyst has been the increasing number of marketing vehicles available to builders—online pay-per-click, social media channels, and search engine optimization. All of these areas are data driven and have not only required us allocating marketing dollars to them, but they have made sure that our traditional advertising is delivering a return on investment (ROI).

At the corporate level, we invest only in online media and it’s the mixture of email marketing and search engine marketing that currently drives the best results for us.

At the division level, all traditional marketing still exists and works to a certain degree or in a certain consumer segment. It’s just that we don’t allocate the kind of dollars we once did to newspapers and billboards, for example. We are more reliant on clicks, cost per click, and website traffic data.

This year will be the first during which we assign an ROI to social media. For the past few years, we were just trying to build audiences and relationships; now we’re seeing people reaching out to us through these social mediums for community and home information, and we can now track sales to our social activities. The past few years were about finding the secret formula; now we are finally ready to capitalize on our social media efforts.

No, updating your website isn't enough.

S. Robert August is president and founder of North Star Synergies, a Colorado-based marketing consultant.

Photos: Peter James Field/agencyrush.com

S. Robert August is president and founder of North Star Synergies, a Colorado-based marketing consultant.

More than 125 years ago, John Wanamaker, president of the Wanamaker’s department store, explained his company’s marketing prowess. “I know that 50 percent of my advertising creates 100 percent of my sales. I just don’t know which 50 percent of my advertising it is.”

Every builder faces the same question: Is its team creating the best marketing plan and implementing it to attract the most qualified buyers?

Most builders, other than the big publics, don’t spend the 1.5 percent of their budget per home on advertising that NAHB’s National Sales and Marketing Council recommends. It’s not atypical for a builder to spend half a percentage point to promote products. These builders need to rethink their marketing strategies and could start by breaking down expenses into three groups: advertising (50 percent of total spending), promotions (35 percent) and public relations (15 percent).

Most builders appreciate that their website is the most important aspect of their marketing. More than 92 percent of prospects research the market online and begin qualifying their builder selections prior to setting foot in a sales environment.

But for too many builders, the Internet has become the be-all and end-all, when builders should be supporting their online communication with multiple megaphones that include on- and off-site signage, direct mail, billboards, and print and electronic advertising, promotions, and public relations.

Measuring the effectiveness of advertising is critical, and includes knowing where your customers come from and how they learned about you. Once you’ve converted prospects to buyers, encourage and even incentivize them to be your ambassadors—an extended third-party sales team—to generate referrals.