BUENA PARK, California (Reuters) – When they saw the house on El Dorado Drive in this Los Angeles suburb being painted a startling orange and green and giant billboards hung on the outside, Scott and Beth Hostetler‘s neighbors were initially angry and confused. Some even considered calling the police.
But what they witnessed on Friday was not an offensive redecoration decision by the Hostetlers, but rather the debut of one of the more unusual schemes to arise from the housing crisis. In return for allowing the front of their four-bedroom house to become a garish advertisement, the Hostetlers are getting their nearly $2,000 monthly mortgage paid by the marketing company behind the project, Brainiacs From Mars.
In a residential neighborhood without heavy traffic, cars passing by the house slowed and drivers gawked at the vivid colors and a giant Brainiacs From Mars billboard.
Romeo Mendoza, the company’s founder and CEO, told Reuters that his ultimate goal is to turn 1,000 homes across the United States into giant advertisements for his marketing firm.
And in each case struggling homeowners will get their mortgage paid, for up to a year.
“If we roll it out to scale and impact the foreclosure crisis, that would be amazing,” Mendoza, 42, said.
Mendoza said he chose the Hostetlers because they are nice people and he wants to choose the most deserving cases rather than homes on the busiest streets.
Since he advertised the scheme on his website in April 2011, Mendoza says he has had 38,000 applications, from as far afield as Russia and Japan.
The Hostetlers, who are both deaf, were one of those applications and were informed three months ago that their home had been chosen to launch the scheme.
There are a number of issues that could prevent the idea from gaining traction, namely zoning laws and other city codes that limit where advertising can be placed and sometimes regulate other aspects of a home’s appearance.
But Mendoza says the idea could help struggling homeowners who face being evicted from their homes through foreclosure, although the Hostetlers say they are going to use the money to pay down credit card debt.
Most of the 38,000 applicants have come from California, Nevada and Florida – the three U.S. states hardest hit by the foreclosure crisis triggered by the collapse in housing prices after the 2008 financial crash.
GRAFFITI OR GODSEND?
In southern California 44 per cent of homeowners are “underwater,” owing more on their mortgages than their homes are worth. In Buena Park, about one in every 270 homes has been foreclosed upon.
“The response has been overwhelming,” Mendoza says. “People are hurting, and struggling to stay in their homes. If we can help some of them, that would be great.”
Mendoza’s plan is to advertise his company’s name and its social media marketing tools on the front of people’s homes. In return, he hopes the quirkiness of the scheme will convince companies to hire Brainiacs From Mars to run their advertising campaigns.
He says he is already negotiating deals with some big firms. The payments to homeowners for the initial experiments are being funded by profits from some of his company’s other projects.
The reaction of the Buena Park city council, and some of the Hostetlers’ neighbors, suggests that Mendoza could face a bumpy ride.
The Hostetlers’ neighbors have been told that the house will only be a giant advertisement for a month. In fact Mr. Hostetler says he would like it to stay that way for six months.
Neighbor Vivian Largent said: “If it’s for a month, I’m ok with it. But no longer.”
Echoing that sentiment, another neighbor, 80-year-old Bob Pancoast, said: “All the neighbors were a little upset at first. We thought they had gone off their rocker. But I guess it’s a good idea for them.”
Mendoza said he had checked and that there are no restrictions in Buena Park on the colors homeowners can paint their houses. “They can paint them multi-colors if they like,” Mendoza said.
Fred Smith, who sits on the Buena Park city council, was surprised when told about the scheme – and not at all happy.
The color scheme was fine, he said. But the advertisements were another matter.
“This does not follow with the city codes,” he said. “They are going to be in trouble. They need to go someplace else.”
Charles Mclaughlin, a finance expert in the housing industry, said: “I don’t think the program will be a success. It will be akin to graffiti – that’s how people are going to look at it. They are going to run into zoning problems everywhere.”
Mendoza said: “There are definitely zoning issues in some cities, and we realize that.
“But we have really hit a nerve, and we can’t let that stop us. Once people start seeing how it works, once they get it, the moment they realize it is paying people’s mortgages, they are always on our side, because of this economy.”
(Editing by Cynthia Osterman)
There are two distinct categories involving buying decisions: the behind-the-scenes issues buyers must manage internally to get stakeholder buy-in for change and for going outside their status quo for a solution and the solution-choice issues.
We are all very familiar with the latter: that’s what sales handles so well. But sales does not handle the former at all:
- we are not there when buyers choose the Buying Decision Team, or the machinations of how they will work together;
- we are not there when the powers that be decide it might actually be time to resolve a problem that has been working well-enough;
- we are not there when internal politics get into gear and people jocky for position in re a new initiative or resolving an historic problem;
- we are not there when the decision is made to either use a familiar provider, or go outside to seek a new one, or do nothing.
To give you some understanding of the order of the steps buyers go through to make the above decisions, think about a time when you decide to purchase a new car, or a new house (or a new something). The very first thing you did was NOT seek out a solution or a vendor. Let’s walk you through the process.
- consider that maybe, just maybe, your current situation isn’t good enough. Just a thought.
- take a look around at the ramifications of the existing situation vs what a different solution would do to your status quo.
- talk with your spouse, kids, friends – your Buying Decision Team. Is the status quo ok for a while longer? What would be important to consider in the decision: money? the time involved in figuring out a new solution? What do you do with the existing solution – keep it? get rid of it? how will you choose – do you need to do some research on the costs of having 2 solutions? And, what will go on with your daily lives when you decide to make a change? Is it a time issue? a money issue? a space issue? What is involved? And what criteria will be used to choose. What about the relationship issues involved? How does each member of the Buying Decision Team get weighted? involved? How do you know when you’ve got the right people in the team? How do you include those you’ve left out?
- Figure out the costs (time, people, money, resource, political/relationship capital) in change. It’s easier to remain with the current situation – but is the status quo too costly? Is the cost too high to make a change? How do you and your decision team go about assessing your internal costs? And whose needs are weighted higher than others? How will you know when one of the Buying Decision Team members is resisting – and how do you all handle that?
- Figure out all of the criteria that will have to be met to keep everyone happy. Everyone. Including your bank.
- Once everyone has agreed to
a. changing the status quo;
b. the type of solution;
c. the criteria that the change/solution must meet;
d. the roles people will play in a purchase choice and adoption activities,
then it’s time to start researching solution choices and providers, get agreement for action from Buying Decision Team.
And this is where sales takes over. Not before.
OUR CURRENT STEPS MISS THE IMPORTANT DECISION FACTORS
Here is what is happening now — and you’ll see why it doesn’t work. Let’s again assume you’re buying a new car, and let’s assume a car sale is similar to other sales calls (a bit of poetic license, please):
- car dealer contacts you to see if you need a new car. Invites you down to showroom to see the car, take you to lunch, sit down and chat with you, etc.
- you have nothing better to do, and the showroom is near your work. You’re thinking of a zippy car for this time in your life. You visit during lunch. You get the whole schpiel – car details, price discussion, a few drinks.
- you are excited – but you’re not sure if this car will be acceptable to your spouse. You sit down with your spouse to discuss your desire to get a new, zippy car.
- spouse is not happy. Spouse wants to buy a vacation cottage with that money; you have an arguement. You decide to put it on the table for a few days and think about it.
- lots of discussion. After three weeks of discussion and no agreement, you and your spouse haven’t gotten further. Your current car is ‘fine’ although with the kids gone you were hoping for something sportier. Your spouse reminds you of the grandkids that now live around the corner. Is there enough money to have two cars?
- seller calls you. What’s up? Great price for the car if you want it. Want to come back in?
See the problem? We wouldn’t buy the way we sell – why do we think our prospects will? Why do we forget the basic facts about people? Why do we treat a problem/need as if it were an isolated event? Why haven’t we adopted new skills to help buyers manage their off-line, private, personal decisions, in the way we would need to for ourselves?
Why do we forget that just as we discuss decisions with family, our buyers discuss decisions with colleagues, and weigh several types of considerations (internal stability, balance of internal political/relationship/timing factors, maintainance of status quo) before they can even consider a new solution?
We forget that if they had found their situation terribly problematic they would have changed already. We forget that choosing our solution – like choosing the car to purchase – is the last thing that goes on in a buyer’s mind. We forget that sales doesn’t offer a different set of skills to help with the different set of decisions.
Think about it. How will you know when it’s time to add Buying Facilitation™ to your current skill set, and help buyers manage their behind-the-scenes decision issues before you sell? How will you know that learning an entirely new skill would sit comfortably with your current skill set and enhance your success?
This article originally appeared on Sharon Drew Morgen – Facilitating Success, One Decision At A Time and has been republished with permission.