A survey by Zillow helps put public sentiment about the economy in perspective. Homeowners are more pessimistic about future home values than they were in the last three quarters. Specifically, 33 percent believe housing prices will fall further; 38 percent believe they have already reached bottom. Few people anticipate a real estate turnaround in the near term. Most believe any increase in home valuation could be more than one year away.
Worse, more homeowners are lining up to create a self-fulfilling prophecy. According to Zillow research, more than 4 million owners are ready to put their homes on the market in the next six months. If they do, increasing surplus could drive prices lower.
"Our forecast remains largely unchanged: We're in for an L-shaped recovery that will likely keep annualized home value appreciation very low for the next three to five years," said Dr. Stan Humphries, chief economist at Zillow. "Given this sentiment, we're surprised so many homeowners believe their market has already bottomed."
As recently as last March, the Obama administration had reworked its troubled $75 billion plan to prevent foreclosures. The idea was to give people a three-to-six-month break on their mortgage payments until new jobs materialized. Unfortunately, jobs didn't materialize, at least not long-term private jobs. The rush to push forth any plan didn't work.
Rethinking Customer Communication Can Improve Outcomes.
The question more organizations need to be asking is how they can help consumers as opposed to helping themselves. Sure, in a robust economy, traditional marketing works because it's based largely on either innovation (creating need) or out positioning the competitor (more common). In a down economy, organizations that aren't innovating need to find other ways to add value.
After all, it doesn't do any good to have the best marketing proposition for a product no one is buying. And marketing needs to consider this in their communication. What specifically are they offering consumers? But more importantly, what is it that consumers need that they might offer?
This falls right in line with some of the best performing Web sites. The Wall Street Journal offers information on business and finances. Lower My Bills provides a place to compare long distance services. Federal Money Retriever provides government grant advice. Facebook offers a popular way to stay connected with friends and family. Google is the most popular search engine for helping people find information they are looking for. And the list goes on.
What does your company's Web site do? If you're like most organizations, your site is not designed to do anything for the consumer. It's designed to help your organization. If it has a blog, it's probably written to sell products or share company news. If it has a social media presence, it's probably designed to attract new friends and followers. Perhaps it includes promotions and coupons, as if discounts somehow add value to something that has no value.
A 5-Second Solution Using Home Improvement As An Example.
Lowe's and Home Depot provide a great example. In the second quarter, Lowes posted an earnings increase of 9.6 percent. Home Depot rose 7 percent. Both have employed a business-as-usual marketing stance.
Home Depot will have a Labor Day sale with gas grills. Lowe's is asking people to imagine new appliances. Meanwhile, consumers are asking themselves whether they will be in the same home next year, negating the need for big home recreation items that won't move with them.
It's mostly the same on Facebook. Home Depot is telling people to do more (grill more, paint more, garden more). Lowe's was telling people to organize their life. Recently, however, Lowe's switched to "Back 2 Campus" ideas, except they aren't ideas as much as they are posts about one discounted product. The latter idea is close to being helpful, but falls short without a choice.
Imagine what might happen if Home Depot or Lowe's did more than justify cautious consumers are a reason for on par sales. If they did that, maybe they would focus on simple renovation projects that can lift homeowners' spirits or, even better, increase the resale value or home valuation of their homes.
