More Leads Don’t Necessarily Mean Better Marketing

Gift-card incentives can increase model-house reservations, but more reservations do not automatically mean better business. In a shrinking market, marketers need volume, but they also need to ask whether they are attracting genuine buyers or simply paying more people to show up. More leads can be useful, but they are not proof of better marketing.

Gift-card incentives can increase model-house reservations, but more reservations do not automatically mean better business. In a shrinking market, marketers need volume, but they also need to ask whether they are attracting genuine buyers or simply paying more people to show up. More leads can be useful, but they are not proof of better marketing.

As a marketer in the Japanese housing industry, we’re in a pretty weird place right now.

Japan’s population is shrinking and ageing. Fewer households means fewer potential homebuyers. Construction costs have risen, materials and labour aren’t getting any cheaper, interest rates are no longer something we can completely ignore, and in the bigger cities you’re fighting for the same customers with countless other house makers.

So getting someone to physically visit a model house is really hard.

One of the industry’s favourite answers is 金券 (kinken), basically gift cards or vouchers offered as an incentive for booking a visit.

And the numbers have become pretty wild.

¥10,000 doesn’t necessarily turn heads anymore. People have become accustomed to ¥30,000 campaigns, and I’ve seen house makers go as high as ¥50,000 just to get someone through the door.

Of course it works.
Offer ¥50,000 and you’ll get more reservations.

The slightly awkward question is: who exactly are you attracting?

There’s an unflattering term used in the industry, 物貰い (mono-morai), for people who go from maker to maker collecting whatever campaign benefits are on offer, with little intention of actually building.

But I don’t entirely blame them.

If we keep telling people their visit is worth ¥30,000 or ¥50,000, can we really complain when some people show up for the ¥30,000 or ¥50,000?

We also use gift-card incentives too. I’m not going to pretend we’re somehow above all this. But we deliberately try not to go crazy with them because we’d rather attract people who are genuinely interested in the homes than win a bidding war over who can hand out the biggest Amazon gift card.

Quality over quantity.

Except…

We also need quantity.

Because the population is shrinking.
And there are fewer potential customers.
And everyone else wants them too.

Ah, the Catch-22.

That’s what makes marketing in this industry interesting. The spreadsheet might tell you that ¥50,000 generated twice as many reservations. It won’t necessarily tell you whether you’ve created twice as much business.

Sometimes you’ve just paid twice as many people to come and see you.

And that’s probably the thing I’d disagree with most in my industry:

More leads don’t necessarily mean better marketing. Sometimes you just bought more leads.

*Photo by CHUTTERSNAP on Unsplash

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