Tertiary markets

Main Street Marketing

Relationship-building strategies boost business in small towns.

Matt Redd, CCIM, owner of Redd Properties in Lake Charles/Sulphur, La., doesn't remember what sparked the idea for his company's trademark marketing strategy, but the effect on his small-town market has been unforgettable. "It keeps our company's name in people's minds for months," he says.

Redd's "Feed the Teachers" program is a bimonthly catered luncheon provided by Redd Properties for local schoolteachers and staff. Through the program the company gives back to the community as well as garners noteworthy publicity. The local newspaper has covered the event, earning the company word-of-mouth referrals. "Businesswise it definitely helps us out. It really gets our name out and the teachers really appreciate it," Redd says.

The program not only has made Redd Properties popular with local teachers, but luncheons have helped it land some deals as well. Teachers and school staff remember Redd's generosity and refer family, friends, and colleagues to the company.

Small-Town America

Redd's relationship-building marketing strategy is ideally suited to his nonurban market. Unlike the cutthroat business environment of major metropolitan markets, doing business in small towns often includes a service or volunteer component. "In a smaller community relationships are very important - you see the same people on a daily or weekly basis," Redd says.

Building a good reputation in local markets is more important than ever today. Small-town America continues to change its face from farmland oases to commercially oriented economies. In increasing numbers residents are leaving urban areas for more peaceful small-town living. The population in America's rural counties increased over the past 20 years for this reason, according to the Population Reference Bureau. During the 1990s, nonmetropolitan areas of less than 50,000 increased by more than 10 percent, adding 5.2 million people to rural America.

Where populations grow, so too does commercial real estate development. In a 2003 CCIM Institute marketing survey, more than half of respondents revealed that they primarily conduct business in markets of 250,000 or less. This was true for all real estate sectors except corporate.

With more opportunities arising in small-town markets, how can CCIMs make sure they get in on the action? While many current marketing strategies center on technology skills, small-town America is one place where high-tech isn't necessarily better.

Community Relations

John Jantsch, a marketing coach and creator of Duct Tape Marketing, a Web site with affordable small-business marketing ideas and strategies, tailors advice to clients according to their market size. "In a big market your message can get lost, so I tell people to narrow their focus and concentrate on a niche. In small towns you need to broaden your reach and get involved in as much as you can," he says.

In this sense, Redd's community-oriented marketing strategy serves as a good example. "In a smaller market you really need to plug into everything going on in the community," Jantsch says. For example, getting involved with schools, sponsoring
sports teams or clubs, volunteering with churches are all good strategies, he says.

Local organizations are another great source of community involvement. "It is absolutely essential to be involved in [local directors'] boards. It shows that not only do I live here and go to church here, I am really involved in shaping the community," says Alton Lee Webb, CCIM, sales director of Alton Webb & Associates in Shelbyville, Ky., which has a population of approximately 10,000.

As president of Shelby County Chamber of Commerce, Webb found the experience rewarding for both his town and his business: He was giving back to the community by participating and also making profitable business connections, he says.

Along with the teacher luncheons, Redd found another community niche by hosting events that lend his company credibility and gain market presence with other commercial real estate professionals. "My company cosponsors a four-hour wetlands seminar that educates people in the community about the process of acquiring a wetland," he says.

Self-Promote

Creating a solid reputation through community connections eliminates most of the need for advertising. "We don't do any print media. We feel like all value is in word-of-mouth and proven reputation," Webb says. But small-town markets do respond to one type of advertising: outdoor signage. "Our firm is diligent about promoting our 'Another Successful Transaction' program," Webb says of his company's marketing campaign. Instead of placing simple sold signs in front of properties, the company uses signs bearing its name and logo and information that updates passersby on the properties' progress. "We use status-changing signs to introduce the new development, business, or end use. In this way, the transaction participants get ownership of the process and the community has a story to tell," he explains.

New developments are front-page news in small towns and the updated signs help keep the community informed and spark conversations, Webb says. "It usually creates a real buzz and identifies our firm as one that is fueling economic growth and is thriving. People like to see success and things happening in the community."

Another way to keep community members informed of commercial real estate news is to garner publicity without paying for it. For instance, many local papers feature regular real estate columns. Commercial real estate experts can create a name for themselves in the community by contributing a column or volunteering as a source.

Team Up

Word-of-mouth travels extra fast in small towns, so establishing a positive professional reputation, especially among other businesses in the community, is important. "Commercial real estate professionals need to align themselves with local insurance companies, banks, attorneys, and accountants, and form strategic partnerships," Jantsch says.

Building a network with other local businesses can generate referrals and create new leads, as well as build an influential network. "Realtors are in a good situation because clients planning to open a business in town will ask themselves first thing, 'Where am I going to locate my business?' This puts commercial real estate pros in a good position to influence them in later business decisions," he says.

CCIMs naturally have a leg up in these situations. As the only CCIM in Shelbyville, Webb didn't have a hard time generating an impressive reputation. "Having my CCIM designation has been very beneficial. It makes me stand out against other brokers. A professional designation really makes me seem more credible," he says.

In fact, as Shelbyville has grown over the past few years, several large national companies such as Lowe's and Walgreens have turned to Webb due to his designation and good reputation. "They can justify working with me because they see I'm a CCIM and we've established ourselves as a knowledgeable local brokerage," he says. In addition, "When brokers in Louis-ville or Lexington are working with retailers looking to expand to Shelbyville, they refer them to me."

Everything from the speed of life to small towns' sights and sounds are different from those in a big city, and doing business in these environments reflects these variations. Understanding that commercial real estate in a smaller market is a relationship-based business can help a brokerage company earn esteem and, in turn, more prospects and profits.

Carolyn Bilsky

Area report is written by Carolyn Bilsky, associate editor of Commercial Investment Real Estate. Contact her at (111) 111-4507 or [email protected]

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