FEBRUARY 2011 |
www.opp.org.uk
BUSINESS
Preferred by Buyers by Types of Homes Available Duplex
Condominium
100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0%
Figure 2. Product Unit Mix Cluster
10% 35% 11% 9% 26% 53% 29% 36% Detached 55%
No Duplex Developer’s Plan
31%
All Home Types
37%
All But No Condo
Copyright ProMatura Group, LLC 2011
(considered jointly) with the price of the home. In contrast, traditional survey research asks each question about a single, independent topic. For example: How many bedrooms do you want in your home? a. One bedroom. b. Two bedrooms. c. Three bedrooms. d. Four bedrooms. Traditional surveys are adequate
if you want to know how many bedrooms they think they want. But if you want to know what they will buy, use Conjoint Analysis. Asking participants how many
bedrooms they want is pointless if they can’t afford the home. Conjoint Analysis tells us the
most important attributes for each person and the group and what will produce the highest sales. We learn which attributes each participant is focusing on when they choose a home. • If they always choose the lowest price for a certain type of home, we know they like that home type and want to pay the least amount for it. • If they focus on the lowest price with no regard for home type, we know that the price charged is going to be imperative. • If they focus on the smallest size, we learn they will trade size for a lower price. • If they will buy only when three bedrooms, larger floor plans, and the beach club are available, we
29%
All But No Cluster
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know for definite that price is not going to be an issue. We tested: • Home Type (detached, semi- detached, or duplex; cluster homes and condominium.) • Floor Plan (six plans for detached homes and two plans each for the other home types.) • Architecture (traditional, contemporary, and colonial.) • Ownership (100% or 25% fractional.) • Size of Home in m2 (three size for each fl oor plan.) • Price Elasticity of Purchase Price (projected prices, 10% below projected, 10% above, and 20% above.) • Price Elasticity of Monthly Base Home Owner=s Association Fees ($35, $55, and $75.) • Beach Club or No Beach Club. • Home Maintenance: no maintenance, exterior home maintenance, interior and exterior home maintenance. • Bakery Bar and Grill (BBG) or no BBG. Results
The results revealed: 1. There was a signifi cant market from other countries. 2. The participants will pay for the beach club and BBG, and both interior and exterior home maintenance. 3. The participants did not like the cluster homes. 4. The proportion of participants who would buy was highest with duplexes included in the product mix. Figure 2 shows the product/unit
100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0%
BUSINESS The 55+ lifestyle | 31
Figure 3. Proportion Who Will Buy Proportion Who Would Buy by Products Available
69%
No Duplexes Developer’s Plan
87%
All Home Types
82% No Condos Source: ProMatura Group
mix in a series of product simulations completed with the conjoint analysis software. This analysis holds some variables constant while we systematically study the attributes of one variable to learn what yields the highest proportion of participants who will buy a home. We tested various combinations of
home types and held the following attributes constant to determine which home types the participants wanted to purchase. • Traditional architecture. • 100% ownership. • Base size of house. • Base prices. • $55 base home owner’s fee. • Interior / exterior home maintenance ($40 added to monthly fee.) • Beach Club (£4,000 added to home price, $20 added to monthly fee.) • BBG ($15 added to monthly fee.) Figure 3 shows the percentage of research participants who found a home in the conjoint analysis study they would buy.
When using the developer’s original product/unit mix of detached homes, cluster homes, and condominiums, 69% of the participants found a home they would purchase.
When using the product mix that
includes the semi-detached (duplex) homes, 87% found a home they would buy.
And when the cluster homes were eliminated from the product mix, 85% would buy. When condominiums were
removed from the product mix, 82% would buy. Conclusions Investing in sophisticated, statistically valid research yields a signifi cant return. Develop the right product for your target market sector, price it to what they will pay (which is often more than you planned to charge), and get a solid base of qualifi ed prospects who are interested in buying in your community. And the benefi ts to you are:
• Confi dence in your product, positioning, and pricing. • Right mix and price of homes yielding greater profi tability. • Perfect mix of amenities, likely to lower development costs. • Jump start in sales. • Reduced marketing costs. • Proven demand for your product and statistically valid sales estimates. • Greater opportunity for raising fi nance with conclusive documentation by a professional independent third-party. • Faster sales, lower costs, higher profi ts.
For more information about ProMatura, please contact:
USA - Margaret Wylde: PHONE 800 201 1483, SKYPE: margaret.wylde EMAIL
mawylde@promatura.com
UK - Mark Jeff rey: PHONE: 0207 806 8095, SKYPE: mark_jeff rey EMAIL: mjeff
rey@promatura.com
85%
No Cluster Homes
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