Security Capital Pacific Trust: A Case for Branding
March 31, 2009
Dr. Berk Ataman
Erasmus University Rotterdam
CASE: Security captical Pacific trust
1. The lack of branding in SCPT?
There are several reasons that explain the traditional lack of branding in the real estate industry. One of the most important reasons is that the real estate industry has been seen as a commodity business for hundreds of years; the main focus was on the property ' and so the product was considered as a tangible aspect only ' not about the customer. E.g. SCPT did not even know who its customers were (Fournier & Thorp, 2001). There was almost no information on their key customer segments, the key drivers of customer choice, preference and satisfaction. Also, branding is seen as a natural process, what assumes extra attention to branding is not necessary. Besides, because competitors neither focus on branding, and organizations tend to imitate each other (Levitt & March, 1988), branding seems less important. Hence, real estate businesses can be seen as financial organizations, in which it is difficult to come up with a look and a feeling. These are essential to position a brand and to create a certain brand image in the consumer’s mind. Moreover, this look and feeling are needed to create a clear brand identity and purpose in the employee’s mind. By mainly focusing on the tangible aspect itself, the unique selling points (USP’s) can be communicated clearly, while the emotional selling points (ESP’s) are often forgotten. For the creation of a branding strategy, these ESP’s are most important (De Pelsmacker et al., 2004). With the addition of emotional aspects, the consumer will get a certain feeling or emotion towards the brand and its products, while with the use of USP’s only, this goal of setting a certain brand image will be almost impossible to reach. Shortly, the focus on the functional benefits and the tangible aspects of a certain property against the lack of the non-functional benefits and the intangible aspects of the product package as a whole, including e.g. the services being offered, the feeling of having a safe and cozy place to live, where you can invite your family, friends and relatives, can account to the traditional lack of branding. Furthermore, the real estate industry is focused on the immediate, in other words, pay backs are on the short term. A long term branding strategy does not fit within the investment company’s corporate strategy. Therefore, branding initiatives were seen as fulfilling the marketing task. Though, the management team acknowledges the potentials of branding, they also for see great risks to fail and so they are not willing to put a big amount of money, which would be needed, in branding. Looking at the marketing activities at SCPT until now, the focus was largely on tactics, at the regional and local levels, while the national level needs more attention to make corporate branding successful. Looking at the overall situation on a national level, branding in the real estate industry was not present at all. The only activity being seen was not more than putting the company’s name on its properties, which they called ‘branding’. Possible reasons to this limited amount of effort put into branding are linked to the availability of monetary resources within the industry, compared to the predicted results when investing certain amounts of money in branding in general. The lack of trust concerning the level of success, which could possibly be generated by creating a branding strategy resulted in the actual lack of branding in the real estate industry. Another reason includes the evolvement of the investment market. Since the emergence of REITs, many investment companies saw opportunities in executing consumer services. Though, in practice, consumer services were not carried out as servicing the customer, but were treated as a necessary evil. E.g. the...