“Shock plunge in home loan approvals”
This was the headline on an internet web site and in thinking about the words used I was wondering who could be shocked?
The Australian Government, as part of its monitory stimulus package, provided for first home buyers financial assistance to purchase real estate with the scheme finishing at the end of 2009.
It was to be expected that once the incentive was removed the number of housing loans would drop considerably therefore the “plunge” was a normal event that occurs whenever governments interfere with any market.
In addressing the fallout from the global financial meltdown the governments of the United States and Australia went down similar paths providing assistance to the automotive industry, banks, with tax brakes, and other help that attempted to maintain jobs and keep the consumer buying.
Any Salesperson or Sales Manager operating in an industry that is affected by these out side influences, such as we have seen in the past twelve months, needs to be aware that their marketing plans have to be adjusted to take into account the period after any stimulus has finished.
Established marketing programmes have to stay in place, despite outside interference to the market, regardless of the extra sales that may be generated.
Generally competition will also increase in these industries and prices will come under pressure either with discounting or if a sellers market is created prices will increase.
By not having an “after stimulus” plan cashflow will suffer with sales possibly returning to levels below those before any artificial stimulus was introduced.
Quite often, a short sighted approach to any marketing plan will, while enjoying the sudden increase in sales from a stimulus, result in the opposite with a drought in sales until the market re establishes itself to normal trading conditions.
Anyone in sales needs to think long term and be able to recognise the outcome of economic events that may occur and always take the steps to continually monitor and interpret how those events will affect the market in which they operate.
