Toaster or Pitcher? That was the incentive I could pick from when I opened up my new savings account in the early 1980’s. I was 12 and excited to have $200 in my coffee can. My young logic told me I could live an entire lifetime on that amount of savings.
There was a slight problem, I had my money in a Savings & Loan. Little did I know that I would possibly face losing my savings of a life time….big drama for a little boy.
In today’s real estate market it seems like new home builders incentive are thrown around with little thought in a panicked attempt to keep the elusive customer engaged. The interesting piece to all this is the potential buyer seem to be more interested in the actual incentive’s size than in what has driven real estate for years. But what does an incentive really project about a new home builder? Does it project:
- I’m desperate?
- My product really isn’t worth what people have been paying for the last 5 years?
- My home is so ugly it needs to be dressed up to make it go away?
- My home is in the wrong neighborhood and the location isn’t so good?
What does an incentive really say to a prospective buyer? Does it help seal the deal? In today’s market it seems like the best incentive peddled by the more desperate builder, is the one garnishing the sale. Are people more interested in the deal? It sure seems so these days. To me it seems short sighted, but I would love to hear from some people on this topic.
I wasn’t quite sure what I would do with a toaster since dad already had one, but I knew I could put some of my favorite Kool-Aid in the plastic pitcher (and my mom thought I would burn down the house having it in my room, never mention the bugs I’d see from eating in my room).
Was the pitcher the only reason I went to that S&L? No. They just happened to on the same side of the street and 2 doors down from my house. I could easily get there on my bike, if I needed to. The pitcher could have ended up costing me $200 and my (perceived) entire life savings during the S&L crisis.
What was the true value of that incentive? Would the transaction have happened anyway? More than likely. I was sold on convenience, not the pitcher.
People buy what they value, what do you see as the motivating factor in today’s purchase?