The more you know about your potential customers, the better you can target your offer to the needs of your customers.
People make a number of life decisions that alter their demand for housing. Housing is so much more than a dry roof over your head. Children grow up and move out on their own. Some will move to be walking distance from a university. Maybe they lose their employment and move back home. The decision to get married and start a family. Sometimes its the decision to end a relationship. People sometimes move due to the loss of a loved one. They move to experience a different climate. They move to experience a different culture. They move to escape persecution. They move for employment. They could move because of a health reason. They sometimes move to create a fresh start. They may move to care for an ailing family member. They could move to be closer to friends. They could move to be closer to the action. Maybe to be closer to recreation. They could move to get away from the pace of the city. They might move to save money. Some will move to create the home of their dreams. They might move to make room for a growing family. They might move to start a garden. They might move because they’re tired of caring for a garden. They might move to have a home that can be left vacant during periods of extended travel.
Every one of these reasons could bring housing requirements unique to the reason for moving.
The averages are a fog that make it impossible to see what is really happening at a tangible granular level. If you’re looking at a 5% vacancy rate in the market, that number could obscure what is happening in each of these specific market segments.
You have no idea whether there is a shortage of housing within walking distance of the university if you’re stuck in market averages? You don’t know whether there is a surplus of 3 and 4 bedroom units and a shortage of 1’s and 2’s.
The more you know about the needs of your clients, the better you can market to them. Someone with health problems might not be able to navigate steps and would prefer a single story home. The averages tell you nothing about homes with stairs.
If you’re looking at cancelling your commercial office lease and working form a home office to save money, you may need a larger home. The averages tell you very little about the suitability of a property for a specific customer.
When you understand who your target customer is, you can better package your final product. The features of the finished product can be tailored to meet the needs of your customer. If your target is families with aging parents, a separate accessory suite might be the perfect feature. The market might have 5% average market vacancy, but absolutely zero inventory for properties with accessory suites.
Averages are for businesses that don’t care to know their customers. When you go to the average grocery store for average customers and buy a head of lettuce, they know how many lettuce they sell per day on average. They know how many cases of Coke they sell each day. These are completely anonymous transactions They don’t know who is buying it.
But when you go to whole foods and you give your amazon prime number for a discount, they know that if you bought a head of kale lettuce, you’re probably going to buy tofu. They know that you won’t buy a Coke, and they know where you live. That’s a level of detailed knowledge about the customer that few other businesses have, and it’s the reason why Amazon continues to grow so quickly and virtually dominate every segment they choose to enter. They dominate because they know their customers so much better.
