FLAT FEE REAL ESTATE AGENCY FACES ADVERTISING BAN

More of an advertising story than a public relations one but of interest all the same....

Property Wizards, the Auckland-based low flat fee real estate company has been banned from advertising in any edition of Property Press, in what the directors believe is yet another example of bias against cheaper non traditional agencies, which is keeping charges to New Zealand homeowners higher than they should be.

Steven Sharp, director, Property Wizards explains: `The wrong advertisement was accidently placed in an issue of the Central Property Press and the publishers have used this as an excuse to ban Property Wizards from ever advertising in any edition of Property Press. We believe our flat fee model has sparked antagonism from vested interests who do not want to see the cost of selling a home come down.’

Property Wizards , which became a fully licensed real estate agency in December last year, charges a low flat sale fee of $7,000 plus GST, regardless of the value of the property, which is only payable when a sale becomes unconditional. When marketing costs are included the cost of selling a typical $400,000 home in Auckland is around $10,000, substantially less than what it would cost with a traditional agency.

Earlier this month Massey University senior property lecturer, Dr Susan Flint-Hartle was reported as saying New Zealand homeowners were paying too much to real estate agents and that the big firms’ were stopping fees from reducing because like any established industry there’s a stranglehold on the ways things are done.

Steven Sharp added: `Our situation is similar to that experienced by the Joneses just over 18 months ago when they introduced a flat fee system and found all sorts of barriers erected to keep them in check. However, Property Wizards is taking a more prudent approach to expansion.

`We are one of the few licensed agencies which does not charge a commission on a sliding scale meaning vendors can save a substantial amount of money selling with us. Not only that, we retain our salespeople and help them develop an income stream. And for those people who wish to sell their homes themselves we offer a suite of off the shelf marketing packages.’

For more information check out www.propertywizards.co.nz

THE WWW.TESTDRIVE.CO.NZ MYSTERY

I have to say, I really enjoyed the XT Network TV advertisement that was launched last night. It looks like it has had a fair amount of money poured into it- it's a swish, high quality TVC and featured one of my favourite presenters of all time, Richard Hammond from the legendary British TV show, Top Gear. You can watch the video at the XT Network 'teaser' website: www.testdrive.co.nz

The advert did the job perfectly- I was so intrigued by it that I took note of the website address which popped up at the end and went straight to my laptop to find out more about what was being promoted (I actually assumed that it was for a new kind of car or plane!) They have been discussing the campaign over at GeekZone. Apparently, XT Network is the new branding for the upcoming Telecom New Zealand WCDMA network, that will be launched in June 2009.

I'm really impressed with how Telecom has approached the introduction of this new brand. It has been a perfect example of how a well planned and coordinated public relations, advertising and online marketing campaign can work absolute wonders. Telecom has been teasing the media and the public with stories about the new WCDMA network for the past couple of years (check out this NZ Herald story from 2007). The Richard Hammond TV advertisement and test drive website have acted as the perfect catalysts to boost anticipation and awareness of the official launch in a couple of month's time.

Let's just hope that Telecom's new service lives up to the promise and is as good as their advertising and PR....

COMPANIES SLASHING ADVERTISING BUDGETS SHOULD TURN THEIR ATTENTION TO MORE COST EFFECTIVE PR

It's an undeniable fact. Business owners, both in New Zealand and the rest of the world, are responding to leaner economic times, by slashing their advertising budgets.

In February 2009, TVNZ announced that it would be cutting $25million from budgets over a four month period to cover a decline in advertising . In the UK, a Bellwether report showed that 35% of British companies had reduced their ad spend in the third quarter of 2008.

I hope that a need to pull back on certain areas of expenditure will cause more companies to explore more effective, value for money approaches, rather than sticking their heads in the sand and ignoring their marketing obligations altogether.

Public relations is one way of getting more bang for your buck. The market exposure you get from a well executed PR campaign is often much greater than an expensive, flashy ad campaign. This is generally because PR is slower burning and is an ongoing, ever evolving process, whereas advertising is hard hitting (e.g. a big TV ad or a series of print ads) but is gone (and sometimes forgotten...) just as quickly

PR also has an extra advantage in that it is much more credible than advertising. According to Forrester Research, nine out of ten people don't trust advertising while nine out of ten people do buy on the basis of peer recommendation. This is predominantly down to the rise of social media; increased consumer generated content in mainstream media and easier access to media across platforms.

I have to add that, despite what today's blog image implies, I am not an advertising hater ! I think that the most effective campaigns are those that combine both advertising and public relations. One fantastic example is the ongoing global Dove Campaign for Real Beauty.

The best way of ensuring value for money is by using a company that can provide a fully integrated PR and advertising programme.