I recently spotted a billboard along the freeway that said “Just because I was born rich doesn’t mean I’m stupid.” This statement really struck a chord with me as I thought back 10 years ago to when I made the decision to move across town to an area that, in the past, had been less than desirable. Back then this section of town was comprised mostly of low income housing that was surrounded by undeveloped rolling hills and rural farm land.
A smart developer with a vision purchased a large amount of acreage in the hills with the intent to develop a gated community that would surround a new golf course. It took just one visit to the development, and I knew instantly this had much more than anything that I had previously seen or was even looking for: security, beautiful setting on a golf course, use of a spa, pool, fitness center and other Country Club amenities! Country Club? Me? Never in my wildest dreams did I imagine that I would live in a Country Club.
However, because this was a new development in a virtually undeveloped area the pricing was very attractive. I found a comparable condo in the middle of town in the same price category, however it did not come close to matching any of the extra amenities that would be included with my condo. I decided to stretch a bit beyond my budget, and go for it. Once I moved in I was certain that I had made the right decision at the right time!
The lessons I learned next were real eye openers. Because it is a condo, I have a very small patio area. Being a brand new unit, there was only dirt outside my back door surrounded by a short fence. I called for several estimates to have a flagstone patio laid down and was shocked at the quotes I was getting for such a small area. I started asking my neighbors, and they were finding the same thing. We started to call it “Gate Pricing.”
You would get a rough estimate by phone and then as soon as they came through the gates and saw the golf course and country club, the price seemed to double or sometimes triple. This started happening every time I called for any type of services. I am certain that if I had bought that the same price basic condo in the middle of town, the quotes would have been more in line with what would be reasonable.
Being a new community in the hills, there also weren’t any grocery stores or shopping centers close by. It wasn’t too long before another “dollar signs-in-the-eyes” developer bought some adjacent property and decided to build a strip mall. Of course he believed he struck gold and didn’t want just any stores, he wanted only “high-end” establishments, charging rent accordingly. Again, the assumption was that everyone who lived within the community would clamor to spend their money there, if only for the convenience.
One by one the establishments opened and subsequently closed down. The rent the businesses were being charged was so exorbitant that they had no choice but to overcharge for their products. The specialty grocery store had to lay off employees, the boutique toy store went out of business and the chic restaurant had to liquidate everything including the fixtures and the complete inventory of expensive liquor. Now we are left with real estate companies and mortgage brokers.
Thank goodness they kept the Starbucks! Now the neighbors can still pick up their non-fat, decaf, no foam latte and drink it along their road trip to the nearest Costco, which happens to be about 15 miles away. You see, even the wealthy will go the extra miles to spend their money at Costco not because they have to…because they choose to. With competitive prices on everyday goods, high-quality items and brand-name products, Costco attracts smart affluent people. This means bigger spenders and bigger revenue for Costco. Hmmm…competitive pricing for high quality products. Add to this formula exceptional personal service and there’s the key to selling luxury travel to the wealthy.
Learning from my experiences, slowly and steadily I penetrated my sales into the community by using various ongoing and consistent communication tactics, such as ads in the community newsletter, listing on the club’s website, ads in the member directory and other neighbor’s testimonials. I knew first and foremost that I had to gain their trust by assuring them that I had their best interest in mind, and not what was in their bank account.
You see, many of those “dollar sign-in-the-eyes” companies that targeted our new community did get our business because they offered guaranteed services. However, when they were paid in full most of them were “gone with the wind” leaving us high and dry with no recourse. With patience, hard work and determination, eventually my name has gained recognition and I have established a comfort level that I am truly legitimate and not another “Fly-By-Night-Travel.com”. You can do this too.
Anita Pagliasso is the author of “How I Made A Small Fortune as a Home-Based Travel Agent” “From Home-Based to POWERHOUSE” and “Anita’s Toolbox for Home-Based Agents CD”(www.redticketproductions.com), President, Host Agency Ticket To Travel (www.travelagentathome.com), Travel Agent Forum Conference Director, and PATH President & Executive Board Member. Finally Anita is also a professional educator with The Travel Institute, www.thetravelinstitute.com.