The sale of big-ticket projects depends on visibility. We got Shah Rukh Khan on board primarily for his larger-than-life screen image that goes well with our brand, says the DLF spokesperson. The group even has loyalty plans for identified high networth buyers who get exclusive rights to participate in its by invitation projects.
Expect more hype and hoopla when the impact of the relaxed guidelines on foreign direct investment, announced in March this year, begins to take effect. Already, the advertising spend by the real estate segment in the year 2006-07 is estimated at Rs 350 crore, according to a market assessment done by Media e2e, a media consultancy and technology firm. This indicates a growth of 35% over the previous year, with the bulk of the money going into print and outdoor. We expect category advertising to grow at 45-50% in the next fiscal (2007-08), says Atul Phadnis, chief evangelist, Media e2e.
Whats more, a TAM Media study for the month of September-October indicates that there has been a 72% jump in print advertising in the real estate sector from January to September 2006 over the same period in the previous year. On TV, which comes second in preference to print, advertising is skewed towards the Hindi news channels and category advertising still outweighs promos and event-specific communication. Even here, ad spends have gone up three times, which according to experts, indicates that marketing in this sector is gradually becoming more brand- than sales-led, indicating the gradual maturity of the sector.
Now compare this to the scenario that existed three-four years ago when a self-imposed advertising code prohibited government-owned All India Radio from airing ads related to jewellery and property products (in terms of credibility, they were clubbed as one) and youd know the distance traveled in the customers/investors mind over such a short span.
Five years ago, you wouldnt have trusted a small-time builder enough to invest in his name, even before the licence on a project had come through; these days, we see a lot of that happening through pre-launch sales, points out Arvind Parakh, chief operating officer, corporate strategies, Omaxe, a company thats been just a couple of decades in the business, but has managed to figure among the top five advertisers in the sector in a recent TAM media research.
Responding to that trust, builders have hiked their communication budgets. There is another compelling need for this kind of visibility. On the demand side, people have more purchasing power and the low interest rates on home loans, makes the finance option viable, while on the supply side, the market has become less restrictive and more competitive, explains Parakh.
The Omaxe Group, for instance, has around 50 projects in the pipeline. Because of its regional presence, its media plan is still print-led (about 80% of its media budget goes into newspapers and magazines) and regularly takes out full-page colour ads in leading English-language newspapers. Print also makes sense for a sector thats still considered relatively low on credibility.
Take the Rs 200-crore Gaursons India, which also figures among the top six advertisers in the TAM study. A player thats only a decade old, it has five mega projects in its kitty, valued above Rs 1,000 crore. According to the company, its ad budget, which stood at Rs 1 crore in 2004, has risen to a whopping Rs 10 crore in 2006. For Gaursons as well, print is the key advertising medium. Nonetheless, we have earmarked Rs 1.25 crore for the electronic media and are also doing a lot of radio, reveals Rahul Gaur, managing director of Gaursons India.
The reason for such hike in ad budgets, according to DP Srivastava, vice-president, Suncity Projects, is the glut of projects in the market Since demand still outstrips supply, everybody is trying hard to break the clutter, he adds. Suncity, which also figures among the top five advertisers on TV, has projects worth Rs 25,000 crore in the pipeline in Indore, Bhiwari, Rohtak, Panchkula, Jaipur, Mohali and other Tier-II and III cities.
With the real estate boom shifting from metros to non-metros (Indore, Jaipur, Meerut, Bhiwari etc) and mini-metros (Gurgaon, NOIDA, Faridabad etc), the share of properties/real estate advertising in the non-metro newspapers have also gone up. A TAM study for the JanuarySeptember 2006 period shows that as much as 34% of the ads in non-metros papers and 12% in mini-metros were contributed by properties/real estate advertising (figures in volumes). Another notable trend is the sudden spike in spends in womens magazines, betraying the keen interest women have begun to take in property matters.
Evidently, in a booming market, everybody is ready to party!