In search of the new real estate marketing executive Don't look now, but your competitor just hired a former brand manager from a world-class, diversified entertainment company as its new executive vice president/director of marketing. Do you know why, and what kind of competitive advantage this might bring?
Traditionally, commercial real estate has been an entrepreneurial, deal-oriented business with little use for high-level marketing strategies. But those days are ending, as we're discovering in recent executive search work for top U.S. real estate companies. Market conditions have dramatically escalated real estate companies' marketing needs and, thus, the talents needed for the marketing function. For example, the new real estate marketing executive is likely to need five or six skill sets - possibly not even developed in the real estate industry - rather than one or two as in the past. This includes the ability to develop high-level business strategies for competitive advantage and then to drive it to execution.
The changing marketer's role is easy to understand when you consider the magnitude of change in the real estate industry in recent years. Virtually every company in the upper echelon of the real estate business has experienced it. Companies have merged, diverged, consolidated, reorganized, shifted strategic direction, added new products, gone global and become far more sophisticated financially. Most are attempting to move "upstream" by getting out of managing properties and into the brokering business. With all the changes, it's no wonder that companies are searching for a "superman" or "superwoman" in marketing who can help them formulate strategies for their transformed businesses.
Marketing exec checklist
* Financially savvy
* Experienced in product development
* Experienced in branding/image-building
* Experienced in doing or managing investor relations
* Know more than real estate
What are the most desirable traits for the new marketing executive? Based on our searches, the following are the most requested right now:
* Seasoned. Real estate companies don't want a newly minted MBA. They want a seasoned professional with 10 to 20 years of work experience, so he or she can come in and hit the ground running. Not all of the experience has to have been in the real estate industry. But the person must have solid experience in managing people and in running a piece of a business. He or she will have seen many business cycles and be able to draw upon many years' experience in finding business solutions.
* Multiskilled. Specific needs vary by company, but we're being asked for people with experience in high-level business and marketing strategies; sales; business development; product development, including market research and testing; brand management and image-building; investor relations; and marketing communications/public relations.
* Financially savvy. The new marketing executive must understand financial markets, investment management or any other financial concerns relevant to the company's market. Specific needs, again, vary by company. For example, a marketing executive from a mutual fund would be a good fit for a real estate investment adviser; a developer, on the other hand, might need someone with more community relations and bank sales experience.
* Experienced in product development. Investors want innovative, appealing real estate investment products; the real estate marketing executive should be able to assist in developing them. As part of his or her product development experience, the marketer should be able to implement market research and testing so that products are not developed until there's a proven market for them.
* Experienced in branding/image-building. Consider how image has been diluted and confused in the real estate industry in recent years. Whole companies have been swallowed up by other companies. Pieces of companies are attached to pieces of other companies. It all leaves the market asking, "What does this company do?" A strong brand, along with company reputation and management leadership esteem, is crucial for attracting capital and clients. Logical sources of candidates with brand management experience include consumer financial service organizations such as banks or brokerages, as well as advertising agencies focused on financial services.
* Experienced in doing or managing investor relations. In public companies, the new marketing executive puts on an investor relations cap to tell stakeholders about the company's leadership, structure and profitability.
* Know more than real estate. It's important today to be able to draw upon diverse knowledge to drive new levels of real estate marketing success. For example, a Canadian real estate developer asked Spencer Stuart to find someone who could help real estate investment professionals match real estate market trends to anticipated investor trends using demographic and historical data.
Thus, the changing real estate market is requiring new levels of marketing executive skills and leadership. Getting an executive to fit the role will require commitment on a company's part, both financially and organizationally. Compensation can reach well into the mid-six figures, and many companies feel ambivalent about making some of the changes suggested by these professionals. If you're hesitating, remember, your competitor's hiring of a new kind of real estate marketing executive means he's looking toward the future. Maybe it's time to consider whether you should, too.