Lai-san Kwok and Eileen Mary Hastings - Hong Kong Institute of ...

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Surveying and Built Environment Vol 17(1), 27-34 June 2006 ISSN 1816-9554Hong Kong Real Estate Agency Industry:Survey on Important Marketing Factorsand Branding Attributes in light ofService IntangibilityLai-san Kwok and Eileen Mary Hastings 1ABSTRACTThe aim of the study is to investigate the attitude of real estate agency companies in Hong Kongtowards marketing factors which drive the customers’ service employment decision and attitudetowards branding in light of service intangibility. Due to the nature of the real estate agency industryand service intangibility, it is found that personnel is one of the crucial factors which drive thecustomers’ willingness to buy the service. Branding, on the other hand, being an indicator of servicequality, can be a way of marketing real estate agency services. In establishment of a service brand,personalized service and service quality play an important role.KEYWORDSMarketing Factors, Branding AttributesBACKGROUND OF THE STUDYReal estate agency companies serve asmiddlemen between parties. They help the buyersand lessees to identify potential properties whichsuit their demand. On the other hand, they assistthe developers, property owners or leasers tosearch for interested parties. The estate agentswill perform all sorts of tasks including introducinga client, arranging viewing of a property,negotiating terms, arranging signing of Sales andPurchase Agreement and explaining the termsin the agreement etc. When transaction is closed,the estate agent is entitled to receivecommissions. The commission is a kind of servicecharge.The real estate agency companies serve to1Department of Real Estate and Construction, The University ofHong Kongreduce transaction cost involved in propertytransaction, like finding interested parties,identifying potential property, conductnegotiation etc. They act as a bridge betweensupply and demand which facilitates thetransaction. In January 2005, there were a totalof 3166 registered estate agency shops and8827 registered estate agents according to thestatistic of Estate Agents Authority. Real estateagency is a highly competitive industry. In orderto stand out in the market, one has to use variousstrategies so as to enjoy part of the market share.Marketing is one of the choices.Appropriate marketing strategy enables thecustomers to know the competitive advantagesof the real estate agency companies. It shouldbe clarified that marketing is not purelyadvertisements and promotions. It is a processinvolves perception, understanding, stimulationand satisfaction of the target markets’ demand.SBE27
Hong Kong Real Estate Agency Industry:Survey on Important Marketing Factors and Branding Attributes in light of Service IntangibilityIt channels the companies’ resources to meet thedemand. Therefore, marketing of real estateagency companies are not purely advertisingthe property available and persuade thecustomers to buy.Marketing can channel the real estate agencyservices to meet the demand of the customers.However real estate agency is a service provisionindustry. It differs from goods like can of drinkand set of computer. Real estate agency serviceis intangible in nature. It is difficult to comparethe quality and price like what the customers didwhen they buy goods. It is hard for the customersto evaluate and compare something which isintangible. It is difficult to tell which real estateagency is better. This is not just the challengesfaced by the customers, but the real estateagency themselves.In this competitive industry, the real estate agencycompanies have to seek ways to attractcustomers. They have to make the customersknow and “feel” that their services are betterthan that of their competitors. But intangibility ofservice makes marketing more difficult. Thecompany, therefore, has to rely on some othertangible cues such as personnel, price, andfacilities etc. to make service quality more easilyassessable. By utilizing tangible cues, it will beeasier to channel information to the customersand more importantly, to persuade the customersin service employment. As a result marketingbecomes important for the real estate agencycompanies.In marketing real estate agency service, benefitsshould be conferred to the customers. Benefitsshall be conferred by some attributes whichwould affect the customers’ choice.Furthermore, branding exists in goods industry,for example there are popular fashion brand andfood brand. Service brand is not new in otherindustry like banking and finance. In real estateagency industry, service brands do exist. Whenthe customers heard of a service brand, theywill immediately have a perception on thecompany and on the service as well. Servicebrand in fact serves to make intangible servicetangible. It offers the real estate agency a marketposition. There are lots of factors contributing toa brand. All the branding attributes contribute todifferent extent in a brand. Branding attributeslike expertise, company reputation and price etc.channel the benefits to the customers. Thesebenefits drive the customers’ decision. A brandgives meaning to an intangible service.Marketing tells the customers how customersshould read the brand.SUMMARY OF FINDINGSLiterature search, questionnaires and interviewswere used as the methodology for the study.Background information on marketing andbranding was found from literature search.Questionnaires and interviews formed the sourceof information for the empirical study. Data onthe ranking of set of attributes on marketing andbranding were collected to achieve the aim ofthe study. Decimal scale point and weightingfrom Analytical Hierarchy Process would be usedfor analysis of data.Two questionnaires were set. For the first set ofquestionnaire, 150 sets had been sent and 67were returned. 26 respondents of the firstquestionnaire fell into the target group of thesecond questionnaire. Therefore, 26 invitationletters were sent to invite them for an interview.13 respondents agreed to participate in theinterview, but 5 interviews stopped aftercompleting the first few questions.Among respondents of Questionnaire 1, 33%and 39% of the respondents have specializedpeople responsible for marketing and a companylogo respectively. The first three most importantfactors perceived by the respondents in affectingthe customers’ choice of service are “Personnel”,“Location” and “Service quality”. The three majorsources of business of respondents are “ReferralSBE28
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