It is easy to criticize the Indian real estate sector for its narrative, or the lack of it. But it takes some thorough understanding of the business, its ROI cycle, its historical legacies and multiple other factors to find method into the madness. We explore how the real estate can create its own effective narrative like some of the other matured industries.
When the Mutual Fund business was trying to gain ground in India the Mutual Fund Association of India successfully pulled in the members to create a narrative “Mutual Fund Sahi Hai.” The AuM in India Mutual Fund Industry stands at 24.55 trillion INR as of May 31st, 2020. The AuM in India has grown four fold in a decade (2010-2020) and the industry added 44.2 million folios between March 2014 and June 2019. Almost the entire growth in folios came from the individual investors’ segment (retail & HNI), which logged a CAGR of 15.5% over this period. Their average ticket size, too, increased from 102,000 INR in March 2014 to 169,000 INR in June 2019.
Similarly, when there were clouds over the cola industry for its high sugar content and harmful effects, the two leading & competing brands got together to create their own narrative. Right from Bollywood celebrities to doctors were roped in to endorse that a little bit of sugar is not that bad for health.
Narratives play a larger role in shaping public perception and industries across the board have been known to create their own narrative to gain the acceptance in the collective consciousness. In the business of real estate, a lot has been said about the need to create the right kind of narrative. And it is not just the India reality; the developers have been found clueless more often than not when there is a crisis over the business.
In the wake of Covid-19 pandemic, there are more question marks over the sector that has to sell the buyers their biggest investment of life. After some initial panic, the voices coming out of the sector are either a defensive stance of, “sales are not that bad as anticipated” or even worse “all is well; market has bounced back.”
This is the time that the developers in their collective consciousness must acknowledge that the business needs to have a kind of narrative that could gain acceptance among the larger universe of buyers.
JC Sharma, VC & MD of Sobha Limited points to a larger issue when he says that like any other sector, the real estate too has a strong symbiotic relationship between its products and its narrative. Both go together. Only in such cases of solidity, narratives can evoke trust and authenticity. With this pandemic, consolidation within the sector is imminent.
“Players with strong processes in place who have a good track record of delivering high quality products in time will stand the ground. They have been communicating with authenticity, sharing their innumerable stories with empathy with their target audience and the larger stakeholders. Such players will dominate the real estate sector soon and will gain immensely by communicating with credibility, says Sharma.
Apurva Gupta, Chief Marketing Officer, Rivali Park, CCI Projects, on the contrary, believes this being a tough time for the industry, several real estate players and industry bodies are stepping forward with plans and policies to deal with this unexpected situation. They are positively countering to the needs of the construction workers and labourers which in turn can prove to be a major factor for its revival, considering the sector’s dependency on these migrating workforces.
“With the economy now slowly rebooting, the industry along with the government must find strategies to meet the pent-up demand created due to an acute shortage of labourers. The onset of construction activities will have multiple advantages like wages to labourers, cash flow to developers, credit growth for financial institutions and reopening of the country’s economic activity. Having targeted relief measures in place will ensure that the industry continues to remain a foremost employment generator thus leveraging its future prospects,” says Gupta.
A roadmap for realty narrative:
Acceptance: Accept that there is a crisis and the sector has no role in it. By denial that there is stress, and insisting that “all is well” the buyers are further being pushed away with trust issue. After all, the sector also has to deal with the historical legacy of poor perception and projection.
KYC: Like any other business, KYC (Know Your Customer) is the key in the housing market. Put yourself into the shoes of the prospective buyers. If someo0ne has been financially hit (job losses or salary cut) there is no point telling him how this is the right time to buy a house. The better narrative would be to better tell him go for a smaller apartment and have lesser LTV (Loan to Value) with the bank.
Content Marketing: Content Marketing has been debated quite a bit without its real understanding among the key stakeholders. The need of the hour is to have informed debate than guesswork. And yes, rope in third party faces that are trustworthy in the public perception.
Compelling story telling: Human mind is pre-programmed to connect with compelling stories; stories that we could relate ourselves with. Share stories of real life experiences of your buyers; keep focus on ROX (Return on Experience) than ROI (Return on Investment).
Focus on the larger issues around micro market: This is not for you if you are not confident about your own projects. But across the country, there are projects that have actually elevated the location profile of the region. If you have that kind of project, share it with the larger audience; while playing subtle with your own glory story.
Video Narrative: We all love short & crisp videos. Don’t we? Create short videos with compelling stories about the ROI, comparison with other asset classes, projects, real life experiences etc and you have a captive audience who would trust; and not reject it as paid propaganda.
Power of Compounding: We all know the power of compounding in the investment world. Do we know how effective it is in spreading the narrative? Make the compelling stories with media go viral. It has the potential to turn vicious cycle into the virtuous cycle.
Creating a narrative and making it gain acceptance in collective consciousness needs far more efforts than creating a branded marketing content. It is about connecting with the psychograph of the audience; and only a seasoned content specialist with no quick-fix ROI goal can goad the sector to long-term results. The incentive and the perspective has to be different.
Ravi Sinha
@Ravitrack2media
Track2Realty is an independent media group managed by a consortium of journalists. Starting as the first e-newspaper in the Indian real estate sector in 2011, the group has today evolved as a think-tank on the sector with specialized research reports and rating & ranking. We are editorially independent and free from commercial bias and/or influenced by investors or shareholders. Our editorial team has no clash of interest in practicing high quality journalism that is free, frank & fearless.
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