Marketing the Right Products – David Twiggs

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I was speaking recently at the American Association of Retirement Communities national conference in Memphis about “Repositioning the Large Scale Community to be Relevant in Today’s Market” and was asked about effective marketing campaigns. Once you understand your market and have positioned your community to authentically serve relevant lifestyle options, there are some excellent media resources out there for marketing your community.    Ideal Living magazine as a great national example and Center for Carolina Living is a regional platform. However, I quickly turned our discussion to the much-overlooked fact that these media outlets can only convey the story you supply. Marketing can never make up for a product problem and many of our communities have a product problem.

 

If we continue to advertise a 25-year-old story, we will not be attractive to the coming markets. If we cannot actually deliver authentic and fulfilling lifestyle options relevant to today’s market, we will simply fall into irrelevance. The things that drew the people who moved to your community in the past do not motivate today’s market. Not only are we experiencing the change from silent generation to boomers, we are dealing with post recession value shifts and fragmented media.

 

Fixing a product problem is about finding the unique lifestyle options you can provide and creating those opportunities. I work in rural destination and resort style communities so I look at what markets I can develop in addition to the country club sports model that the original developer banked on. Notice, I said lifestyles in addition to, not replacing what we have. Nothing wrong with an element of the country club model but it better not be the only product you offer. The golf centric community market is saturated on all levels and price points but it can still be a strong part of your holistic lifestyle options. If a program you offer is no longer relevant, it will die a natural death. Who is building a new shuffleboard stadium? No one, they are  irrelevant. You had better have lifestyle options relevant to the coming market to attract new growth. We should protect the elements of our lifestyle we love and add complimentary lifestyle options that we can authentically provide. Be Unique. Generic and boring are well represented in the market. You are not trying to attract everyone only those who want your unique lifestyle.

 

For Hot Springs Village, I have developed a Master Plan Workbook in which we explore possible new lifestyle possibilities, housing typology, engagement brands and community branding. Notice this is titled a workbook not an engraved in stone plan. This is an ever changing document. We explore many ideas for lifestyle and community improvements. We don’t implement them all. Some fit some do not, but we are not afraid to explore all options and are daily improving our formally dated products. If you have a unique product, marketing is much easier. Getting picked out of a mass of similar communities is difficult and often leads to wasting our limited marketing dollars.

 

You are welcome to look at the current version of my Master Plan Work Book for HSV. Please remember it is an ongoing presentation piece so some details and all proprietary information such as market studies for housing, hotel, commercial and retail have been omitted. Each community is unique. You can’t simply copy someone else’s model. Look at your products, understand your market, and make sure your story is relevant before you invest your marketing dollars.

CLICK HERE FOR A PDF Masterplan Workbook 1221.2014 UPDATE

https://www.youtube.com/watch?v=7tjFZlnYuFQ

Conscious Development: Creating Places Where People Thrive

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Density and Intensity of Eureka Springs, AR

David Twiggs

When is development good?  Many projects and developers took a bad rap over the past few years as projects slowed or were abandoned in the wake of the real estate bubble bust.  I have found this a very interesting time as we have been able to really see the wheat separated from the chaff.  Real value became evident from the sales prices. Some communities held and even grew in value while other stagnated and declined. We can read endless statistics on trends in housing types, square footages, amenities and governance structures.  We can study the different margins offered by new construction techniques. Even after sorting through these, I can find clear examples of  communities that remain great places and seem to defy much of the statistical logic.  Exceptions to the rules so to speak, with varying degrees of buildout, widely different amenity focus and different community personalities.

After looking at hundreds of communities from the most successful to the worst failures, I believe that the communities that have sustainable success are those disciplined enough to keep a conscious focus on creating relevant value during initial planning and as the community matures throughout the years.  Often when we think of value in real estate, perceived value is top of mind.  This seems to stem from a bias to the sales point of view.  A marketers creation of urgency and desire to purchase a specific property is creation of  perceived value in the mind of the potential owner. Property must sell for developers to get return on investment and everyone to paid. Nothing wrong with getting paid for working hard.  I wouldn’t use a marketer who did not know how to create perceived value.  In common usage the term perceived value is used generically to say how a resident feels about their property.  However, as creators of communities, we need to sharpen our vocabulary and be specific in what is created and evolved over time.

Truly successful communities have a different vibe going on. The success of great places comes from the sustained satisfaction of the dynamic population overtime. I call this Relevant Value because it evolves to prove or disprove the perceived value at the point of sale. As our products are typically the most expensive purchase our customer will ever make, we have the responsibility to assure that our marketing promises will not only be kept, but actually create inherently satisfying place to continue to evolve where individuals can thrive.

I believe life is happiness based.  Perceived value can be true or false for a potential owner, was it based in reality or just hype.  A property purchase is typically as aspirational as it is functional. Even more so in second home or retirement based real estate purchases.   Perceived value creates sales.  Some promises even when kept turn out to be hollow. The are not inherently satisfying.  Relevant value creates happy people over time.  It does not matter if our development is for  starter homes, a major tourism destination, or a mix of lifestyles and stages; being conscious of creating places that meet the higher happiness needs of the subcultures we attract is our responsibility.  We must focus on the nature of the different subcultures we want to attract and be sure they are complimentary.  We must be specific not generic.  One community model will satisfy everyone.  Yet for years, the second home and retirement market has basically supplied a single model and cast questioning glances at anyone wanting something different. We must make the right promises and keep them.

Recently, I was having a conversation with Todd Zimmerman of Zimmerman/Volk Associates who is doing a market study for a project I am putting together. After discussing the holistic approach I was planning for this project, Todd gave me the language to describe the elements I was trying to influence, a new framework for the terms of  “density and intensity.”  While Todd was much more eloquent and nuanced in his explanation, I simplified it to fit my need.   Density is how the built environment engages people. Intensity is how the mix of cultures engages people  To create relevant value, we must be conscious to address both to these elements. Exactly how we do this varies with the nature of the place we seek to create and the subcultures we seek to serve.  The quality of place we create impacts the happiness and wellbeing of those we seek to attract. That is a fundamental  responsibility of Conscious Development.

Moving Ideas to Start-ups in Master Planned Communities  David Twiggs AICP

Moving Ideas to Start-ups in Master Planned Communities David Twiggs AICP

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Micro Neighborhood Infill Concept Drawing By Dr. Yang Luo Director of Placemaking Hot Springs Village AR

The only way large-scale communities can move beyond their outdated and market irrelevant pre recession status quo is to become remarkable in a sea of mediocre competitors. This requires developing new ideas, programs, and facilities and taking them to startup mode quickly. Starting is the hardest thing for an individual to do in a bureaucratic, fearful, and hypercritical environment.

This typically is an environment that will debate an idea endlessly in search of perfection; seeking guarantees and prepositioned blame for anything less than a grand slam idea. This is not forward thinking and not applicable for running the nimble businesses we must be post recession market.

Startups aren’t about perfection. They are about taking an idea to the market while it can make an impact. We take an idea, put together a plan, put it on the market, evaluate, and revise. We continue to revise until the product succeeds or fails but we are in the marketplace while it can make a difference. Obviously the higher the cost of failure, the greater the preparation before launch but an idea that is never launched will not succeed and you will learn nothing. An idea launched to late, after it has been proven in other communities, does nothing to make you remarkable. That just makes you a follower trying to keep up with the bold communities.

I believe in due diligence but many start-up opportunities are lost by over caution and collective fear of failure. A start-up designed to make a planned community remarkable is by definition something that others are not doing. If you can find five of your competitors to compare how this idea worked for them, you are simply a follower behind the curve. You are not inventing or innovating anything.

Look at Maslow’s Hierarchy of Needs and determine what level need your community is supplying. The higher up the need you are satisfying, the more remarkable and marketable you are. You will not satisfy everyone as you reach for a higher level. You can never satisfy everyone. Timid community leadership will at best keep their head down and try nothing that is unproved. At their worst they will actively criticize those who will try saying it is not the responsibility of the association. Criticism is only aimed at the bold who standout.

Any manager can follow the manual and dodge criticism. Professional community leaders are paid to create bold new directions. Intuition and courage are the traits to seek in hiring people as game changers. These people will start things. Some things will fail, but fast cheap failures are part of the business process. If I have ten startups and two fail, the failing ideas will get criticized. Is my community better off for the eight new innovative programs and facilities I succeeded with or should I have protected myself by not launching anything that had a risk of failure. If you believe you are doing the right thing, be tough and take the criticism. Being bold is much more fun and in the long run the only way to create extraordinary places.

Where Have the Real Estate Investors Gone? David Twiggs, AICP

Placemaking Planning: Grove Park Market Drawing by Dr. Yang Luo, Director of Placemaking Hot Springs Village, AR

Placemaking Planning: Grove Park Market
Drawing by Dr. Yang Luo, Director of Placemaking Hot Springs Village, AR

I was recently in two meetings that seemed to be lamenting the same condition. All of the real estate investors have disappeared. The consensus seemed to be, the recession killed the real estate investor. One of these meetings was a discussion by several community professionals trying to revitalize their respective master planned communities. The other was a grassroots organization to revitalize a historic but challenged section of a tourism driven city. This got me thinking about the role of private investment in existing community development and redevelopment.

In my present project, I find that the investor has not disappeared at all. The unsophisticated real estate investor is gone. The easy money for any project is gone.

The amateur buying twenty overpriced lots in pre-sale based on a rendering of what might be built is not a reliable entity as it was in the past. We must now supply sound business plans with specific value enhancing strategies; in other words, we must work hard to have projects worth investing in. The recession has killed the lazy uninformed investor that perpetuated mediocre projects. And that’s a good thing.

So how do we find investors in revitalizing our communities? The recession has brought on so many opportunities for assembling property that had previously been sold. Property may have been abandoned and fell into the ownership of an association. It may have reverted back to a town, county, or state for failure to pay the taxes. There is also the shadow inventory of people who pay taxes and assessments but would gladly rid themselves of an unimproved property if there were a market or an entity that would take it. My point, there is now property available at a low cost basis that was not available pre-recession. What are our plans for that property?

Today’s investor wants to see a clear plan for a property to become marketable and relevant to the present and coming marketplace. There needs to be specific strategies for adding value to specific property. Personal real estate is the ultimate lifestyle product. It fundamentally must have real community and ultra-local value. Community value is the lifestyle improvements you receive by living first in the chosen region and then the specific community. There must be true quality of place. There must be relevant lifestyle options.

Ultra-local value opportunities come from fulfilling the original lifestyle promises for all the properties inside a community. Many developers in the past 30 years focused on the premium lot sales. Waterfront, golf courses, view and open space lots were the cash cows and the remaining interior lots were simply not considered as to the livability. This worked in the sales process because the lifestyle of the premium lots was being promised to all; but  it was  never delivered to all in a livable fashion. The buyer of an interior lot finds that they do not have the access and lifestyle of the lake house across the street. They must get in their car and drive to access the lake or any other lifestyle amenity for that matter. It has no ultra-local value. I define ultra-local value as what I can leave my home and do without getting in an automobile. Can I walk the dog down to the lake, can I access a trail system, walk to the art studio, or bike over to a social area, have coffee and people watch? This is ultra-local value.

Value can be a point source. There is not much value to “your neighbor has great lakefront but you can drive to the access just 3 miles away,” or “you can’t see it or access it from here but there is a great open space just over there that you can drive to.” Property was sold as if the prime amenity had ultra-local value rather than simply community value. Look at where your homes developed. What was the source of that value? How much “gravity” does that point of value have? In other words how large a radius of lots does that value impact. A single private home with a great view radiates no gravity to the neighboring lot with no view. A coffee shop that is walkable from 300 homes radiates a lot of ultra-local value while still supplying community value. While we do want to have premium properties available, the premium price garnered by the view, lake or open space lot could be leveraged much better by allowing common access to that point source value gravity in the form of a neighborhood gathering area. This allows the property value and marketability to be raised over all property in a radius rather than at a single point.

The amount of value gravity will always vary by location within the community. From a technical point of view, the investor is looking for investment areas where the existing socio/spacial value gravity can be influenced. Specific improvements are wanted. Defined, understandable, and doable. In more general terms, we must get to work planning our futures. If we have feasible strategies to improve the livability and relevance of specific areas and market those correctly; the savvy investor will find you.

 

 

Changing Destination Values: David Twiggs

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Who wants to be treated like a tourist?  We are now faced with creating and recreating destination communities to meet a new set of values that have rapidly shifted from the pre-recession model.  Perhaps it was the financial reality check that accelerated the already growing shift in values into the mainstream.  Many have shifted from seeking a tourist experience to wanting to feel belonging and experience self-discovery when we travel, invest in a second home or look for a quality place for retirement.

In 2009, Kurt Anderson began the conversation about a great reset in American values.  He and others speak of a “new frugality” that has resulted from values being shifted away from a consumption-based mentality. Conspicuous consumption has lost favor as a value proposition and is being replaced with a value for simple honest and authentic experience.

This includes a shift away from credit-based lifestyle, which will slow our traditional metrics for economic growth.  Those metrics do not clearly recognize the vitality that can come from formally marginalized places being rediscovered and appreciated.  It doesn’t directly show the benefit of the local shops, restaurants, cafes and services being supported by a shift from corporate destination tourism to destination community based tourism patterns.

When we speak of a value shift, it begs the question “from what.” Dr. Brene Brown (brenebrown.com,) speaks of moving away from a culture where being preoccupied, over scheduled and over connected has become a status symbol and into living wholeheartedly. Technology, industrialization and automation of tasks that formally were part of basic home economics has both created a lifestyle free of what many consider preindustrial “drudgery” but it has also a disconnected us from the basic human processes of thousands of years.

In the past many experiences were designed to allow us escape into artificial environments. Destinations today should seek to bring us into a different rhythm, show as another lifestyle point of view or seek to connect us to nature and the basic systems of being human. The common denominator in this value shift to more authentic experiences is a desire for greater understanding, physical and spiritual growth and renewal. For some this may be a place for adventure, meditation, or learning.  In looking at how to grow tourism or relocation in your community, don’t worry about trying to satisfy this vast array of potential interests, remember you are not trying to attract everyone, you want those visitors and new residents that appreciate the authentic subcultures of your community.  Be who you are. Be inclusive. Share your passion.

Create a Destination Point of View Then Create your Team – David Twiggs

Me and Bob Marley in the Foxhunting Sub-culture

Me and Bob Marley in the Foxhunting Sub-culture

One of the easiest mistakes that we make in trying to create a destination service system is taking the wrong point of view.  It must always focus on conveying the sincere and authentic culture of the region in the point of view of the target market. It is not about us except to the extent that it is our passions that are attractive to this market and we would like to maximize the socio-economic benefits of serving it.  This can be very challenging in the rural / small town setting.  While it is these traditions and lifestyles that create the potential for handmade tourism.  There can also be regional and business practices that hinder destination development.

In the South, many small town businesses and resident based communities close there doors and roll up the streets on late afternoons and evenings.  This makes servicing a destination market difficult.  To look at building destination/tourism based economic development, we must educate our business environment showing the opportunities to serve this new market.  Not only do we have to be open and available for visitors.  We have to understand that the sub-cultures and values are the reasons our visitors come.  There is a myriad of subculture activities that can be the core draw but in all cases people come to have an enjoyable time.  Enjoyment is our deliverable regardless of discipline.

My philosophy for a destination community is that if visiting, living in, and working in the community is not enjoyable; no one will care about the place.  We want everyone, visitors, residents and the workforce to enjoy every experience, activity, interaction, conversation, and perception.  We want our colleagues, coworkers and ourselves to feel they are doing meaningful work and understand how what we do is important to creating the experience and lifestyle.

To do this we must create a community of belonging for our visitors, residents and coworkers.  People want to find their tribe not simply be a tourist.  Sure the tourist experience is fun on occasion but to attract quality growth in a region that will value and protect the assets and traditions important to a place, the ultimate visitor experience is a sense of belonging that creates a protective attitude about a place.

We must create an atmosphere of personal growth and a culture of helping others.  Hedonism is a nice place to visit but we all know the rest of that phrase.  It can be fun for short periods of time but it is not a sustainable or fulfilling lifestyle.  More and more research on the hedonic treadmill theory clearly shows that the conspicuous status seeking that many destination communities marketed successfully for many years is breaking down as the prevalent value proposition for in migration decisions. The industry so permeated a calibrated idea of the American dream that the expectation of the masses was that these stereotypes would make them happy.  Now isolation is one of the top problems facing communities of all types.

Janis Joplin once said that America should be looking for sincerity and a good time.  To me that falls into my philosophy that a community must be focused on being a collection of real relationships rather than simply a defined real estate space.  The consumer and hedonistic based stereotypes are breaking down in favor of meaningful involvement and service.  That is for all the residents, visitors, and those that work in these communities.

It does not really matter what types of values your particular destination is based on as long as it is sincere to you and your target market.  One whose dream destination is the Pennsylvania Amish country probably will not be lured to move to Vegas and vise versa.

Arts, heritage, nature based, sporting, adventure, gaming, and entertainment are just a few of the many types of destinations being created.  My point is they are becoming ever more unique and celebrate individualism while promoting a specific culture.

The Town of Saluda, in the Green River region of NC, is a good example. Complementary sub-cultures centering on a natural feature, the gorge and the river in this case, spins off many opportunities.  World class whitewater kayaking is a core lifestyle activity focusing on the Narrows for the obsessed, the Upper and Lower sections for the interested and curious. Trout fishing opportunities for all levels are throughout the region.  The obsessed set the tone for the region. The interested group supports the local outfitters with instruction on quality whitewater boats, standup paddleboards and rubber kayaks.  The curious and casual supply a market on the lower section with thousands of tubers floating the river supporting several tubing outfitters and campgrounds.  Visitors here for hiking, biking, zip lines and climbing mix well with those that simply come to enjoy the natural beauty and walk the quaint streets. With this visitor base, the 5.2-acre downtown commercial core of Saluda, population 711, has the opportunity for supplying more diverse activities and support services.  General stores, organic markets, and B&B’s are prime features. Several cafes and specialty restaurants are supported. My favorite restaurant is ”The Purple Onion.” Its concept value was creating a sustainable venue for a vibrant live music scene for many local and regional musicians. To do this they created an outstanding eclectic restaurant to support this goal.   Art shops, spa services, and ice cream stores round out some of the other services.

All this is in a tight sustainable setting that seeks to protect the nature of the community and the natural resources that draw the visitors.  They put controls in place to control growth.  It was economic development but not at any cost. So far they seem to know when enough is enough and have protected the very things that make them attractive. This makes Saluda a prime example of good planning so the area reaps the benefits of a tourism / destination community economy while remaining sustainable, livable and protective of there traditions and culture.

Regardless of the original motivation of your destination, you now must base it on a set of values and specific culture.  Staying authentic and sincere to those values is vital.  At a meeting a couple years ago and I was fortunate to listen to Bert Jacobs, founder of  “Life is Good,” tell the story of he and his brother living out their van on the road while starting up their tee shirts business.  Their R&D was drawing pictures on the wall of their apartment and having friends pick a favorite at a party to be the next design.

When the brand became so popular they were looking to get financing for expansion.  The bankers said they had to bring in management consultants in order to get the loan.  The consultants laid out a tried and typical marketing plan to expand the brand but it did not fit the core values or culture.   As part of the finance structure, there was 100K to advertise the consultants plan.  Jacobs got the loan, fired the consultants and rather than follow the canned business plan; threw the largest outdoor party ever held in Boston. Now that strategy drew national attention and has morphed into huge annual fundraisers giving away millions to their community.

I tell this story because by sticking to core values, Jacobs catapulted the brand into international attention building a company that was remarkable and unique.  Could he have followed the Madison Ave marketing strategy and grew the company? Probably, but it would not likely have become the unique worldwide brand it is now.

What is exciting about the post-recession destination community industry is that there is no longer a tried and true formula for creating these destinations.  You cannot succeed being generic or average anymore.  Even if a destination community could, I would not want to waste my energy to simply churn out another cookie cutter destination.  That eventually dilutes the livability and core culture of the region.  I want to build value-based destinations that are fanatical about their unique values, passions and culture.  That’s where the fun is.

Fun yes, but also serious business. In a destination system, there are many types of businesses required and supported by the destination economy. I break these into 4 key areas:

Core Activity

Lodging

Entertainment

Provisions

There is also the normal support business: hardware, building, trades, insurance, accounting, and cleaners etc.  Sounds much like the list required to support any type of economic development.

Creating a Team

The markets visiting these destinations are doing so because of an interest in the passions of the sub-cultures.  While learning our core passion activities may have taken us years of painstaking practice, study or research; the market is simply coming for an opportunity to belong and learn.  To create the conditions for belonging, one simply has to put our passions authentically out there.  There needs be no college degree, no special certification course or credentialing to be passionate about the cultures within your area.  There is no experience level required, just passion.  These are basic human interactions done well.

If you have an area with true quality of place that has real potential to be an authentic destination community, how do you start  to realize the economic development? You must put together a team. No one is going to be passionate about creating an economic system for a destination community unless they love the area, feel the need for economic growth, and they have direct benefit from the results of the process.  There will be many others along the process that will be lukewarm.   They may be pro or con.  They may or may not understand the potential benefits or detriments.  They may only see the negatives or not see the potential negatives of uncontrolled unplanned growth. A good core team is required to overcome and these impediments.

In building your team:

  1. Go through the cataloging process to find the private entities that will most directly benefit from the area becoming more attractive to in migration.  Community associations are often major drivers that already have marketing budgets that are often being spent on much less attractive or effective ad campaigns.
  2. Build out the Core Activity, Lodging, Entertainment and Provision matrix to identify smaller partners.
  3. The private professional community often can easily donate in-kind work that is vital to the start up if they are aware of the need. Be strategic.
  4. Look at necessary governmental partnerships.  You may simply be putting feathers in their cap rather than receiving any tangible support at first. These are your partners and can be great in expediting the project but raise your initial funding privately if possible.
  5. Find resources for land planning and development policy creation early in the process.
  6. Keep the team as small as possible and prioritize.
  7. To avoid political stagnation, it may be preferable to legalize the team as an independent non-profit or L.L.C.
  8. Only bring on passionate believers in the project willing to put in the time in the short run.

Pick your point of view: that will determine your team.

Thanks to Arkansas Democrat Gazette for the Feature

Thanks to Wayne Bryan for coming up to talk about Hot Springs Village. The only clarification I would add is that in the discussion on where boomers are choosing to live ” the old golf only community model is not relevant.” Golf is still an important part for many of the boomers decision making process. Golf is an extremely beneficial and important part of life for many of our villagers and we consistently have hundreds of thousands of rounds played each year. We want to continue to grow and improve our golf programs as we develop many of the other interests that will continue the evolution of this extraordinary place. Thanks again.

http://m.arkansasonline.com/news/2013/jul/21/general-manager-brings-new-vision-village/#c190774