Transcript Marketing Problem and Solution

Marketing Problem and Solution
Matthew Neitzel
August 30, 2011
Introduction to the Businesses
• Four different businesses
– Program HR 3648
– Trudocs
– RealPrompt Real Estate
– RealPrompt Realty
Balanced Scorecard Evaluation
• What is a balanced scorecard evaluation?
• Consists of four perspectives
– The financial perspective
– The customer perspective
– The internal business perspective
– The learning and growth perspective
• Owners keep most of this secret from
everyone
The Financial Perspective
• Critical success factors:
– Revenue growth through new client sales
– Productivity improvement through
implementation of solid training platform
– Asset Utilization through electronic services
The Customer Perspective
• Critical success factors:
– Quality of services through recruiting
knowledgeable short sale processors
– Reducing processing time through proper training
and one-on-one contact with client
– Creating value for the client through several
training modules and access to short sale software
The Internal Business Perspective
• Critical success factors:
– Productivity through quality, knowledgeable, and
trainable short sale processors
– Research into new technologies to help improve
efficiency.
– Gathering and delivering quality leads for the
clients in order to increase short sale processing
The Learning and Growth Perspective
• Critical success factors:
– The employees through quality training
– The information systems through having a high
priority in researching new technologies
– Product innovation through research into new
technologies for the clients
Controlling Costs
• Costs include: rent, internet/phone, web
servers, marketing servers & applications,
processing applications, training portals, fax
lines, phone server, fixed & variable payrolls,
and database application/maintenance
• Costs of quality
– Prevention costs
– Appraisal costs
– Internal failure costs
– External failure costs
Prevention Costs
•
•
•
•
Phone server
Training portal
Database application/maintenance
Short sale processing application
Appraisal Costs
• Phone system
• Database application/maintenance
• Short sale processing application
External Failure Costs
• Payroll
• Database application/maintenance
• Short sale processing application
Environmental Costs
• Originally had few environmental costs
– Printers
– Ink cartridges
– Paper
• Paperless process
– Saves on wasted paper, ink cartridges, and printer
maintenance
– Saves processing time
Profitability
• Only two ways to be profitable
– Selling distressed homeowner leads
• 125 of homeowners 30, 60, 90, or 120, days behind on
mortgage
• Clients market to homeowners to do a short sale
– Processing short sales
• One percent referral fee
• 30 to 35 percent commission to processor
Customer Response Time
• Critical to the success of the company
• Two avenues to measure efficiency
– Time it takes to send leads
• Send information to lead harvesting company
• Receive leads
• Send leads to clients
– Tracking time spent on phone
• More time on phone = quicker the files are processed
• More time on phone = higher commission checks
Marketing
• The company has only one form of marketing
– Buys email lists of real estate professionals
– Sends email blasts
– Potential clients come to a webinar/watch
presentation
– Client signs up for leads and/or processing
• Used since the company first started
Problem with One Form of Marketing
• Greatly affecting
– The organization
• Quick profits made it the only way to market
• Bills go unpaid
• Good services are switched for poor services
– Extreme employee turnover rate
• Without experience, owners treat employees poorly
• When sales decrease employees are laid-off or quit
– Clients
• Clients must get to know new processors constantly
• Clients must learn new applications
Potential Solutions to the Problem
• Three potential solutions for one method of
marketing
– Partner with national brokerages
• Increase short sale business for all companies
– Working at or with seminars
• Advertise at seminars, purchase a booth, host a
seminar
– Run different types of media advertisements
• Realtor magazines, real estate websites, direct mail to
real estate professional, radio advertisements
Payoff Table
PRPES Decision Alternatives per year
State of Nature ($ in thousands)
Decision Alternative
Low # of new clients
High # of new clients
Partnering
71
124
Seminars
29
206
Advertising
-53
248
•
•
•
•
Least expensive – Partnering with broker
Medium expensive – Advertising at bi-monthly seminars
Most expensive – Advertising through media
State of Nature – low increase to high increase in new clients
Expected Value of Decisions
Other Methods of Marketing Expected Value
Partnering
0.4(71)+0.6(124) =
102.93
Seminars
0.4(29)+0.6(206) =
135.25
Advertising
0.4(-53)+0.6(248) =
127.77
EVwPI
EVwoPI
EVPI
Other Methods of Marketing EVPI
0.4(71)+0.6(248) =
177.45
0.4(29)+0.6(206)
177.45-127.77
=
=
135.25
42.20
Decision Tree
Conclusion
• Should pursue other methods of marketing
• Could increase profits
• Two other change recommendations
– Create a solid business strategy
– Focus on employee retention
References
ASQ. (2010). Basic concepts: Cost of quality (COQ). Retrieved from
http://asq.org/learn-about-quality/cost-ofquality/overview/overview.html.
Dorkin, J. (2011). The foreclosure process: Understanding how foreclosures
work. Retrieved from http://www.biggerpockets.com/foreclosureprocess.html.
Jackson, S., Sawyers, R., Sweeney, D., & Anderson, D. (2008). Managerial
accounting and statistics (custom). Mason, OH: Cengage Learning.
John. (2011). What is a short sale? Retrieved from
http://shortsaleshelp.org/what-is-a-short-sale/.
Lindamood, K. (2011). HR 3648 mortgage forgiveness debt relief act.
Retrieved from http://www.ehow.com/facts_4827401_mortgageforgiveness-debt-relief-act.html.