| In a day and age where nearly two-thirds of | | | | & Co. can all invest huge sums on money on |
| enterprise value is originating from intangible assets | | | | brand building initiatives, then why can't a real estate |
| alone, the future value of businesses, especially those | | | | consulting business do the same? If knowledge like |
| which are knowledge driven, will largely tend to be | | | | tangible goods is transferable from one party to |
| concentrated in the ways in which firms manage and | | | | another, the why question the former under the |
| acknowledge these value creating assets. Branding in | | | | pretext of intangibility? |
| a knowledge driven business like real estate | | | | Real Estate consulting firms in India have long |
| consulting is a fairly new concept. In this article, I | | | | engaged in head-to-head competition in search of |
| discuss why real estate consulting firms should adopt | | | | sustained, profitable growth. They have fought for |
| the practice of brand-building and how this in turn can | | | | competitive advantage, battled over market share, |
| enhance their long term value and future growth in a | | | | and struggled for differentiation. Yet in today's |
| market like India. | | | | overcrowded real estate market, competing head-on |
| After the slump in the mid-90s', real estate firms are | | | | results in nothing but a bloody "red ocean" of rivals |
| back in action into what can be called as the biggest | | | | fighting over a shrinking profit pool. The only key to |
| housing and commercial real estate booms in the | | | | success and survival in this market is not to |
| history. This time the bubble seems to be growing | | | | out-perform the competition, but to create a new |
| consistently and until it pops, the business may just | | | | uncontested market space, thereby making the |
| keep looking better. While some investors may insist | | | | competition irrelevant. Hence, the three building blocks |
| that the growth is too much too soon, there are | | | | of branded differentiation that real estate consulting |
| many who believe that the growing real estate | | | | firms must adapt are: value innovation, tipping point |
| sector is not due to any irrational exuberance but a | | | | leadership and robust delivery process. |
| vote of confidence in resurgent India. The demand | | | | As intangible assets (especially brands) contribute |
| for real estate is at a all time high. The Ernst & | | | | over two-thirds of the enterprise value for any |
| Young report recently pegged the Indian Real Estate | | | | business operating in the service sector, shouldn't it |
| market at $12billion and estimated a consistent | | | | be given top most priority in corporate boardrooms? |
| growth of over 30 percent a year in the next 5 | | | | Well, for most companies, branding is still not a |
| years. In addition to this, the government's move in | | | | strategic priority. It is a part of marketing and is |
| opening up the real estate sector allowing 100 | | | | often seen from a profit and loss perspective. Real |
| percent foreign direct investment in the construction | | | | estate consulting firms must understand that with |
| and development has already spurred huge | | | | internationalisation of the market and the tightening |
| investments. | | | | of competition, customers now have a lot of choices |
| As 'expansion' becomes the latest buzzword within | | | | available. Today's mantra is not about being the 'first |
| corporate India, one can hardly predict how long will | | | | choice' of a customer but rather the 'only choice'. In |
| this trend continue. With the growing number of high | | | | other words, a successful real estate consulting brand |
| net worth individuals, the booming spend-thrift middle | | | | would be one that becomes the only source of |
| class population and the massive inflow of | | | | reference for customers as far as buying, selling or |
| multinational corporations, the demand for real estate | | | | leasing a property is concerned. But this is easier said |
| is sky-rocketing. This growth can largely be attributed | | | | than done. |
| to five key catalysts of change: Favourable economic | | | | Realty firms must build for long-term and aim for |
| environment; increasing purchasing power; increasing | | | | developing a strong brand equity (reputational value), |
| financing options; favourable reforms initiated by the | | | | rather than just a brand image. Only then will it be |
| government and growing professionalism. Given the | | | | able to create an uncontested market space and |
| chaos and action in the realty sector, there is no | | | | compete effectively and profitably even at times of |
| doubt that real estate consulting firms will play a | | | | market downturns. Firms must remember that |
| major role in meeting the growing demands. | | | | building a brand generally takes a long time and |
| As demand pushes up, so will the number of | | | | requires a strong commitment from the senior |
| competing players in the market. Not to forget that | | | | management. A brand may easily be destroyed if the |
| these will be in addition to the already established | | | | firm is not acting according to its brand promises. All |
| thousands of realtors in this market. So one can only | | | | people, processes and key activities must be aligned |
| imagine what it's going to take for a new firm to | | | | with the brand promise. Real estate firms must |
| make it big and to make is fast. The challenges are | | | | realise that brand is not worth building up for mere |
| emerging from different quarters, namely big firms | | | | pleasure, but it must bring benefit, for example |
| such as Tamwell Crow Meghraj and Colliers | | | | increased customer base or higher returns on |
| International which are looking at becoming one stop | | | | investment. The best brands - whether consumables, |
| shops, individual experts who have vast experience | | | | real estates or services - are always desired. They |
| of the realty business, online experts such as | | | | may also be exported around the world. A good |
| 99acres.com, management consulting firms such as | | | | brand will reclaim the promise, keep the customers |
| PWC, financial service companies such as IndiaBulls, | | | | satisfied and get them to repurchase your brand |
| ICICI, HDFC etc. As more and more players foray | | | | over and over again. |
| into this business, what will ultimately happen is a | | | | A final word of advice: |
| shake-out where the industry will get rid of the | | | | Building strong brands has nothing to do with being |
| quacks. Only those that are able to build a strong | | | | recognized widely on mass media. It has everything |
| credibility in the market will survive. | | | | to do with dedicating your entire organization to |
| To many marketers, branding a real estate consulting | | | | excellence in every little transaction you conduct, |
| business may sound too farcical. This is because | | | | internally or externally. However big or small you are |
| most believe that branding benefits only those who | | | | today, the future will belong to only those who |
| deal in tangible goods. And since the business of | | | | create a strong reputational value. So my proposition |
| consulting is not product driven, brand-building at best | | | | to all you realtors out there is to set global standards |
| may accrue to word-of-mouth marketing. But aren't | | | | in everything you do and make way for your brand |
| we missing out something here? If knowledge driven | | | | to lead your business. |
| businesses such as Infosys, Intebrand and Mckinsey | | | | |