Are Your Value Props Still Relevant in the Changing Market?

2022 was one of the strangest plot twists in real estate history. We started the year with one of the most competitive markets in history – record-low inventory was paired with inflated demand. Throughout the country, homes skyrocketed in asking price and received several offers over asking.

By the tail end of 2022, a rise in mortgage rates from around 3% to closer to 7% drastically shifted the market, pricing many buyers out and forcing them to adjust their expectations. The shift also discouraged many potential sellers from moving who were already locked in at better rates. Even with the changing landscape of buyers and sellers, the reality is that millions of homes will still transact in 2023. So what do real estate businesses need to do to stay competitive?

Examine your core value props and ensure that they are serving customer needs in the changing market.

I am part of the team at Orchard, a technology company that is building the most stress-free, fair, and simple way to buy and sell homes. During the first half of 2022, the biggest challenge for many of our buyers was getting an offer accepted. In a marketplace in which sellers were getting offers up to 100K over the asking price within 48 hours of listing a home, it became clear that any buyers with contingencies were not going to get an offer accepted.

Orchard adapted our core Move First service to remove all contingencies for buyers and to allow buyers to make an all-cash offer using Orchard cash, prior to selling their homes. For many of our customers, the removal of contingencies and the all-cash offer was what was needed to stand out. For example, Tausif Khanooni, a homeowner in Dallas, TX, shared that these value props are what ultimately helped him to buy his first home: “As first-time buyers, my wife and I were overwhelmed and disappointed after losing out on the first home we tried to buy. 

We came across Orchard after my loan officer recommended them as the best way to win in the current market. Our Orchard buying advisor was incredible – she patiently walked us through every part of the home buying process, made sure our next offer got accepted and even negotiated a brand-new roof covered by the sellers.”

We centered much of our 2022 marketing strategy around the core value prop of “all-cash offers.” Our Facebook and radio ads, press, and marketing emails all leaned towards helping people to stand out from other offers. However, now there has been a clear shift in the needs of buyers. Now, with fewer offers and less competition, buyers are more confident they will get an offer accepted. The bigger thing on their mind, especially for those with the property they also need to sell, is whether or not they will be able to sell their first home on the right timeline and at the right price.

Discover what is most important to your customers that you can offer.

The needs of our customers have shifted. Scary real estate headlines have convinced many sellers and buyers that it’s the wrong time to make a move, and people are nervous to move forward. Historically speaking, current mortgage rates are on par with rates before the pandemic, but the rapid shift has caused cold feet for many.

“By shifting our marketing language from “win in a crowded market” to “buy with the certainty that your home will sell,” we have given our services a 2023 facelift.”

Among our customers, buying is no longer the concern – it is selling. Homeowners who need to sell a property to upsize, downsize or make a move to a new neighborhood are worried that their home will not sell for a satisfactory price within their desired timeline. To address this concern, Orchard has shifted how we talk about our services to emphasize the certainty we give customers. We’ve highlighted our guaranteed offer feature, which commits Orchard to purchase any house that does not sell in 120 days at a pre-agreed upon price.

By shifting our marketing language from “win in a crowded market” to “buy with the certainty that your home will sell,” we have given our services a 2023 facelift. They are the same services, but the ways we talk about them lean more accurately into how we help our customers in the current market.

Stay fluid and test your messaging regularly.

It would be easy to sit in a conference room and guess what customer needs currently are, but this would just be the opinion of a small group of marketers who are mostly based in one part of the country. It’s important to involve our customers in our marketing, regularly chatting with them about their current needs, running AB tests on our website, and doing controlled experiments on advertisements to discover which ads work best.

I would advise any marketing team to develop a hypothesis, but then put that hypothesis to the test. Start by measuring engagement and interaction with ads, but then go a step further. Discover which ads help people to make it further in the funnel, and which ads are creating the most confusion around your services. Take a pragmatic approach to slowly updating your communications rather than overhauling everything overnight.

So, what needs to shift in your marketing strategy to stay relevant?