Dubai property firms look to build trust

Back to basics is the new direction that developers have chosen to market their projects in the UAE.

DUBAI // Back in the days of Dubai's property boom, developers used all sorts of tactics to entice people to buy homes that were still to be built. Gimmicks were popular - everything from mobile phones to Jaguars were thrown in with the sale of a home. In 2007, Damac Properties even gave away an apartment to a newly wed couple from Britain as part of a promotion with the Mall of the Emirates. Celebrities were drawn into the property game too, as developers paid millions for endorsements to make their projects stand out.
ACI, a developer based in Germany, hired the former tennis star Boris Becker and Formula One racing drivers Niki Lauda and Michael Schumacher to lend their names to three of its tower projects early last year. It is believed that Mr Becker was paid Dh10.2 million (US$2.7m), while Mr Schumacher received Dh25.8m and Mr Lauda Dh5.1m. Moves like these became such a big part of company branding that many developers lost sight of what they were selling and who they were selling to, often simply emulating the marketing template of their competitors.
According to John Brash, the founder and chief executive of the consultancy Brash Brands, companies were in such a rush to sell properties that little thought was given to developing a brand that their customers could relate to and believe in. Mr Brash's company has offices in Dubai and Abu Dhabi and has created brands for developments carried out by the likes of Emaar Properties, Sorouh and the Tourism Development and Investment Company (TDIC).
He arrived in Dubai six years ago, when most of the emirate's billboards were taken up with advertising from the pillars of the property community, Emaar and Nakheel. Both were distinctive in their message, he says. Emaar adopted the "integrated community" stance with projects such as The Springs and Downtown Burj Dubai, while Nakheel's message focused on waterfront living. But then came a host of other developers from near and far, each vying for attention.
"Real estate companies launched every week, and all of them talked about 'luxury lifestyle living'," says Mr Brash. "Ever more dramatic and flamboyant masterplans were being created. You had no idea what you were buying. You had to question how economically viable these [projects] were. I think a lot of them were beautiful visions without much substance." The intense competition meant that property companies fought to be different, and gimmicks were plenty.
There was such a frenzy that property was seen as a commodity rather than a significant, long-term investment or somewhere to actually live, says Mr Brash. "A lot of developers looked for a different angle but it became being different for different's sake, as opposed to being relevant to what they were trying to do," he says. "They were never focused on the end-user." Today, as developers deal with a more sombre market, they have begun to take a closer look at their brand and how they liaise with their customers.
Sanjay Sachdev, the senior vice president of marketing at Damac - which has 11,313 units under construction and has delivered 3,039, according to its website - says incentives such as prize giveaways are a thing of the past. Mr Sachdev says changing market conditions have forced Damac to adapt its marketing strategy, with the main focus on project delivery. "We realise that for customers, it is more important than ever before that they realise their investments.
"This is why we have chosen to focus on construction and delivery as an integral part of our marketing strategy, rather than using some of the incentives or promotions we did in the past. We believe that focusing on construction will help to build trust and credibility with customers, with a view to acquiring new ones when the market returns to better times." When Omniyat Properties launched in 2006, it set itself apart through its designs - high-tech homes in futuristically designed buildings such as The Pad, a building in the shape of an iPod, which is due for completion next year.
With a strong brand image, but facing new challenges, the company's main objective is to deliver on its promises. "The financial downturn has taken its toll on many developers and real estate investors," says Mohammed Hmeid, the head of marketing at Omniyat. "This is the new reality that we need to deal with and we plan to come out of it even stronger than before. At Omniyat, we always said that we are not in this business for a quick profit, we are in it to stay.
"The most important thing to do in challenging times is to be transparent and not to stray off course. "You will lose trust the minute you start cutting corners and compromising on quality. This is not what the customer signed up for." Nicholas Maclean, the managing director at CB Richard Ellis, says developers now have a good opportunity to bring marketing strategies "back to basics". "The real opportunity they have now is marketing their product the way it should be," he says.
"The buyer, whether of residential or commercial property, is not interested in the way a building looks; they want to know that a building is properly managed and that the utilities and infrastructure are in place." Mr Maclean says the reason why some developers are now hurting is because they "took their eye off what people wanted", such as the ownership and occupation of a property. "Emaar has got a pretty good handle on this but the rest of the market needs to catch up."
Brand development will need to be more considered as developers shift their sales pitch from speculators to end-users, says Mr Brash. He refers to the boom and crash of the US housing market, and points out that the only developments doing reasonably well there today are those that were designed with the buyer and occupier in mind. "They were all designed and branded around end-users as opposed to investors, and I think that's going to be the challenge in this market."
Consolidation in the property sector - such as the planned merger between Emaar, Dubai Properties, Sama Dubai and Tatweer - will also mean companies will have to develop their brands. "With this deal, it looks as though Emaar will be the lead organisation because of its expertise," says Mr Brash. "I wouldn't be surprised if the company is called Emaar, rather than them coming up with a new joint venture name.
"But they will have to look at the equities of each brand, how that organisation is going to move forward and what the brand is going to stand for, as well as what the common culture is going to be." As developers emerge from the downturn, Mr Brash also advises them to avoid public relations and advertising spin. "If you're true to your vision or belief, then it makes it far easier to communicate with everyone else," he says. "Don't just pour your money into an advertising campaign or PR spin. You need to ask 'what are we about and what are we trying to do?'
"Get a relationship with customers and make sure the target audience is defined. At the end of the day, people don't want gimmicks, they want to buy a house. Trust and transparency needs to come back to the marketplace."
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