Developing an investment tool to reach the market
Value appreciation key to property developer’s strategy amidst competitive industry
DEVELOPERS build homes. But Orando Holdings Sdn Bhd managing director Datuk Dr Eng Wei Chun says he is building a lifestyle.
What people want, according to him, is more time to enjoy other things in life, be it spending time with loved ones or building careers and working on hobbies. “That is lifestyle,” he says.
For Eng, a property should be built for value appreciation and to maintain a lifestyle. It is important that the property does not become a liability, he says.
“I sell [properties] based on lifestyle and I also need to take care of their (buyers) asset, to make sure it doesn’t become a liability to them,” he says.
To do this, getting the location for the property is key. Next, it is about ensuring a practical design for your property.
“A lot of developers want nice design, but it may not be practical for the future. So you must be practical. With a small maintenance fee that you charge to your buyers, how can you maximise the practicality of your facilities? You need to know how to do that,” he explains.
He emphasises the need to develop properties that will become viable investment tools. He calls it taking care of buyers’ wallets too.
Eng believes his approach to property sets him apart in the industry.
Orando won the Platinum prize for Best in Marketing and Best in CSR in the above RM25mil revenue category at The Star Outstanding Business Awards (SOBA) 2017.
Eng doesn’t give away too much details about its marketing strategy. He prefers, instead, to share an analogy.
“When you sell durians, there are many different types of durian. And it is up to the consumer to choose. [Although] Musang King [is popular,] it is not necessarily always the best durian. The kampung durian has its own market and the D24 has another target group.
“We are just creating a different category to get a different group of buyers. We are giving more option to purchasers to choose from. We can’t say we are the best or most special.
“One is an apple, one is an orange. Both are fruits. It is not to say one is better than the other. We are providing variety in the property industry,” he says.
Eng adds that there are no right or wrong marketing plans.
“It’s a lot of trial and error. No one can prove that your method will work for sure, especially for new things,” he says.
However, Eng points out that the basis of a good marketing strategy is one’s understanding of human needs, wants and behaviour. It is only then that developers will be able to build homes that are relevant for their target market.
This, ultimately, makes the selling of property products a lot easier.
But with the rise of different media platforms, Eng notes that the cost of acquiring customers have gone up considerably.
Previously, print advertisements were enough to bring in the crowds across various age and social groups. These days, though, different groups tend to gravitate towards different media platforms.
“You need to spend on a lot of different platform to reach various types of customers. So the cost is increasing but this is something that the whole industry is facing,” he says.
One thing about making a marketing strategy work is also about having the right people. But it is not only about getting the right people to do the right job at the right time, he says. It is also about getting the right buyers.
Orando apparently takes the effort to look through their buyers and their intention for buying the property before a transaction.
Eng says this is to so that they can maintain the quality of their developments.
If a buyer is purchasing Orando’s property for rent, the developer will draft a separate agreement to set certain criteria that they will need to adhere to when renting out their property. Additionally, they will have to pay a higher rate for maintenance fee.
That said, Eng is not trying to hinder purchasers from buying its property for investment.
“I am happy that they are confident in the property,” he says.
While the property market seems to have cool off somewhat, Eng thinks there is room for certain types of property still. It is all about getting the value right for the property and providing healthy competition in the industry.
“You need to know your strong point. A lot of people don’t know how to sell [their property projects]. They are always giving discounts [to attract buyers]. Anyone can give a discount. But will a discount really give better value to consumers? Not necessarily,” he says.
Coming back to his affinity for analogies, Eng refers to his teapot collection, which comprises of many limited editions, to talk about value.
“You must choose products which are valuable and will appreciate in value. This teapot, I bought for RM700. But now, it is worth about RM2,500. You can get a lot of teapots outside for RM30. But they don’t appreciate in value.
“So you must know how to find value appreciation for your purchaser. Only then will people continue to buy from you,” he says.