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Invest in low-cost marketing

Published: 
Sunday, April 13, 2014

The following guide is intended to aid readers in analysing the case Breezy Corner Apartment Complex. When analysing a case, remember that there are many possible approaches and solutions and the goal is to develop your analytical and problem-solving skills rather than figure out “the one right answer”.

 

 

Synopsis:
Sasha Greene bought a four-unit apartment complex six years ago but has recently been unable to attract tenants for all the units. She needs to develop a strategy to increase occupancy, otherwise she may be forced to sell the property. Case analysis:
Q1. Which segment (s) of the market should Sasha target?

 

Three possible segments are mentioned in the case: families with young children, university students and single working professionals. The pros and cons of targeting each group are outlined in Table 1. Given her limited financial resources it is critical for Sasha to focus her efforts on attracting a specific, clearly defined market segment.  The groups that make the most sense at this time appear to be university students and families with young children.

 

Q2. How should the apartments be marketed to communicate value for those targeted?
PRODUCT: The property itself is attractive with good amenities and a great location so there is little need for product modification at this time. 

 

 

PRICE: While the first instinct might be to slash prices to attract tenants, price acts as a signal of quality where a lower price communicates low value. Charging a higher price would also be risky given the level of competition in the market. Offering discounts for signing a long-term lease might be one way to adjust prices without hurting the upscale image of the property.    

 

 

PROMOTION: How and what to communicate depends on the target audience. If the target is university students, then posters on campus might be more effective than an ad in the newspaper. The Yellow Pages would be a cost effective way to reach families or single professionals and can be used to drive traffic to the Web site. Sasha’s small budget means that she will not be able to produce expensive brochures or advertise on TV. 

 

An innovative low-cost strategy would be to initiate a referral programme providing  current tenants with a discount if they convinced a friend to rent a unit. While using a rental agency would allow her to reach a wider audience, it is likely that Breezy would get lost among the listings unless Sasha finds a way to differentiate the property. Hanging a sign on the gate, however, is clearly not effective.

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