Better Words, Higher Prices (Jim Karrh On Marketing)

by Jim Karrh  on Monday, Jul. 21, 2014 12:00 am  

Jim Karrh

If a picture is worth a thousand words, then what are words worth?

There’s no shortage of promotional language in today’s product marketing environment. We have all heard enough about “world-class,” “new and improved” and “killer,” have we not? The marketing world is filled with tired copycat words and phrases that fail to clearly differentiate one company or offering from others. The right words, however, can indeed help create significant and measurable value.

Recent research from the world of residential real estate demonstrates the specific dollar value of proper word choice among real buyers and sellers. A research team studied the listing descriptions of more than 16,000 transactions that occurred during 2000-09 in a Virginia multiple-listing service.

The team wasn’t terribly interested in standard stuff such as the number of bedrooms and bathrooms. Rather, it was investigating the impact of more unusual features and language on sales prices and timing. Not surprisingly, the house listings that included specific property characteristics (like granite countertops or wainscoting) sold at a premium and were also 9.2 percent more likely to sell.

Those are features that are part and parcel of the product (house) itself. What was really interesting is, given a set of features, the impact of different words selected to promote houses to buyers and buyers’ agents. Over that nine-year period, each positive opinion word boosted sale prices by an average of 0.9 percent. Some word examples were “inviting,” “spacious” and “stunning.” That means just three positive words applied to a $300,000 home’s description would translate into an average bump in price of $8,100. Not too shabby.

Still, not all words and phrases are perceived as positive by potential buyers. You and I can imagine (or remember) instances when verbiage is used in an attempt to cover problems: A “breathtaking” house might have been inhabited by a chain smoker, “cozy” means tiny, and a “peek-a-boo view” puts you at risk of falling off a balcony or pulling a neck muscle to see it.

In a separate study, an analysis of real estate sales in Canada, the word “beautiful” increased sales prices, but “good value” reduced sales prices by 6 percent. “Move-in condition” had no effect. The phrases “handyman’s special” and “rental property” were value killers, reducing sales value by up to 30 percent.

The right words matter, but of course some will try to do too much of a good thing. In real estate, as in most other marketing environments, sellers have only a tiny amount of time to catch a prospective buyer’s attention; the sheer volume of words can often deter time-pressed people. The Virginia study showed that lengthy narratives could reduce the sale price by 6 percent. “You have one or two seconds to capture the buyer or buyer’s agent’s attention, and you need to sell [your home] as effectively and efficiently as possible,” said the study’s lead author, Bennie Waller. “There can be some puffing, but too much of it will cause the buyer to look elsewhere.”

Perhaps today is an opportune time for a fresh assessment of the language you and your colleagues are using. Examine your advertising, website, collateral material and customer conversations for those few positive words or phrases that can set you apart and lift perceived value. Check out what competitors are saying, too, to avoid blending in.

That assessment also offers an opportunity to clean house. Lose any tired, puffy language that may have crept in over time, no matter how “epic” someone else might believe it is.

Jim Karrh of Little Rock is a marketing consultant, trainer and speaker. See JimKarrh.com, email him at Jim@JimKarrh.com and follow him on Twitter @JimKarrh.

 

 

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