What do we mean? You are a home inspector, but you could specialize in one or more of the following:
- High-end homes
- Old homes
- New homes
- First-time buyers
Let’s look at the definitions of the terms. Then we’ll give you a few ideas about how these concepts can help you.
Segmentation Segmentation divides up the “mass market” into smaller, distinct markets, or “micromarkets.” Segmentation is the opposite of mass marketing, which is what most home inspection firms practice. Mass marketing is ineffective for any professional service. Segmented marketing is much more effective.
Why do we break down the market into micromarkets? This segmentation process enables us to design a specific marketing strategy for that micromarket.
The idea is to tailor your campaign to fit exactly what the people in that segment are looking for. In other words, you show that you can meet the specific needs of that specific segment. Marketing experts suggest that in a competitive market, you can’t compete effectively in more than one segment.
Here are two things to consider as you look for segments to target:
- The market must be large enough. If there are only 500 real estate transactions per year in your service area, you can’t afford to specialize.
- The segment must be large enough. For example, it does not make sense to target the segment of the market that includes houses over $10 million if there are only a few such houses in your service area.
Targeting Targeting means designing a marketing strategy for a particular market segment. For example, rather than creating a general brochure for home inspections, you would create a brochure for new home inspections, another for inspections for first-time buyers and still another for inspection of old homes or any other market segment you decide is worth targeting. The goal is to satisfy each market’s specific needs.
Positioning Your position is how your customers see you. For example, let’s assume you are very good with first-time buyers. You are trying to create your position by targeting a market segment and by building a specific marketing campaign. Understand that the public decides your position, not you. You may guide the public with your marketing campaign and careful segmentation, but in the end, your customers decide. People who use “position” as an action verb are missing the point. The actions are targeting and segmentation. In this respect, there is no such thing as “positioning.”
An Example of Segmentation, Targeting and Positioning What do segmentation, targeting and positioning have to do with the home inspection business?
The Generic Inspector: The typical home inspector sets up shop, picks a name for the business, gets business cards, builds a website, advertises online and is in business. This home inspector is entirely generic. This home inspector does not stand for anything.
The Great Generic Inspector: If this same home inspector is a great inspector who is good with people, puts things into context and does all the other things that clients and real estate agents expect, that inspector eventually will carve out a market share and have a referral base. The problem is, it typically takes three years to build a self-supporting business using this strategy.
A Better Approach: Here’s an example of a home inspector who uses the principles of segmentation, targeting and positioning to create a memorable inspection company and who will enjoy success in a much shorter period of time:
An inspector chooses to be a specialist in first-time buyers. (First-time buyers are the biggest market segment today. The millennials are starting to buy!) Now, rather than trying to create a marketing strategy that appeals to all, the inspector designs a strategy that appeals to first-time buyers. The inspector’s goal is to create a position in the minds of his or her customers, particularly real estate agents, as being the expert in first-time buyers.
How does the inspector get the message out? With a brochure, flyer or letter designed for the real estate agent. The message is that the inspector specializes in first-time buyers. Here are sample statements for such a brochure, flyer or letter (and notes indicating whether the statement conveys a feature or a benefit of the business):
- We are experts at communicating with your first-time buyers. We leave no questions unanswered (feature). At the end of the inspection, your buyers will feel comfortable knowing they are making the right decision (benefit).
- We keep house conditions in perspective to avoid unnecessarily alarming your clients (feature). They should understand all issues and know which ones are typical of homes of that type and age. We help clients see not only the issues, but the readily available solutions. This means that a well-informed client can make good decisions (benefit).
- We help your clients learn how to operate the home and maintain its systems (feature). More knowledge and understanding will help clients control their emotions and make rational decisions (benefit).
- We are available free of charge at any time after the inspection to answer your clients’ questions and concerns (feature). This saves you time and helps you enhance your reputation as an agent with satisfied clients for life (benefit).
The home inspector might have a special first-time buyer package. As part of the inspection fee, the inspector’s clients might receive a free book about maintaining their home or a discount on a follow-up inspection.
Deliver the Goods: You should come up with a number of strategies that prove you are not only saying that you are the right specialist for first-time buyers, but that you also can deliver the goods. Delivering on your promise creates your position in the minds of your customers. With a segmentation and targeting strategy like this, you have an interesting story to tell real estate sales professionals one on one, in meetings and at events. The message should outline how this process helps agents streamline the process and saves time and money. Remember, the real message is in the benefits rather than in the features.
Stand for One Thing: The key to a solid marketing position is to stand for one thing. That one thing should be clearly identifiable and presented in a simple, clear message. This thing should differentiate you from other home inspectors.
Let people know what you stand for at every opportunity. For example, you can create a tagline for your company like, “ABC Inspection Services—The new home specialists.” This tagline would appear on your e-mail correspondence, on your letterhead or anywhere your name appears.
Specialize: Why are home inspectors afraid to specialize? They fear that by standing for one thing, they will lose much of the market. For example, why would they want to target only first-time buyers when they want all of the business? It doesn’t make sense to reduce the size of the pool, right? Not necessarily! You will get more business by reducing the size of the pool. In fact, you are not really reducing the size of the pool at all; by saying you focus in one area, you are becoming memorable. You stand out.
Let’s say an agent is working with a client who is not a first-time buyer. Do you think the agent won’t refer this client to you because you are a specialist in first-time buyers? Don’t you think that the agent wants a home inspector to treat every client as a first-time buyer? The agent will most likely think, “If this inspector is an expert at handling tricky first-time buyers, he (or she) will be great with all clients.”
The fear of focus is a common theme in every business. You have to trust the marketing experts in the same way that you ask your clients to trust the inspection expert. You will broaden your appeal by focusing on and targeting a single market segment.
Thanks to Roger Hankey and Kevin O’Hornett for sharing their experience and wisdom to make this a better article.