Better Homes and Gardens
Better Homes and Gardens
Broker-owners who’d like nothing more than to get in front of the 38 million readers of Better Homes and Gardens magazine and the 5 million unique monthly visitors to the magazine’s Web site will have that chance in July when Realogy Corp. rolls out its newest franchise brand, Better Homes and Gardens Real Estate.
Last October, the giant real estate services company acquired from magazine owner Meredith Corp., in Des Moines, Iowa, the right to license the Better Homes and Gardens name for 50 years with an option to renew for a second 50 years.
Realogy already owns national residential franchisors Century 21, Coldwell Banker, ERA, and Sotheby’s. It also owns NRT Inc., the country’s largest brokerage holding company, and companies in commercial real estate, title, and referral services.
BHG will be marketing franchise opportunities to established owners of independent brokerages who want to boost their growth through affiliation with a name that will help them stand out from a field increasingly crowded with national names, says Sherry Chris, the company’s president and CEO.
“Seventy-seven percent of broker-owners are still unaffiliated with a franchise, so that’s a large group of potential candidates for us,” says Chris, who was previously chief operating officer of Coldwell Banker Real Estate and, before that, COO of Prudential Calfornia Realty. “We also think we can attract owners whose franchise agreements with other companies are coming to an end and are looking for new options.”
One reason they might switch affiliation is because of what Chris calls the impact issue. That’s when a market is saturated with a particular brand name, making further growth in that market under that brand name unrealistic.
“That gives us leeway to talk to people who may be impacted by the other brands,” she says.
Chris doesn’t see her company competing for broker-owners already affiliated with a Realogy brand. Rather than switching to BHG, what’s more likely, she says, is that these owners will see the new brand as an attractive way to diversify by getting into markets they’re not already in.
“Some of Realogy’s broker-owners own multiple brands, so they can have a Coldwell Banker in one city and a Better Homes and Gardens somewhere else,” she says.
BHG will tap into the same back-office systems and business practices that the other Realogy brands share, but its consumer identity will stay closely aligned with the magazine and the magazine’s Web site. “Our cross marketing with Better Homes and Gardens magazine will be a big differentiator for us,” she says.
Among other things, Realogy has agreed to purchase advertising in Meredith titles and to market Meredith magazine subscriptions through the Better Homes and Gardens Real Estate franchise system, according to information provided by Meredith.
The magazine’s demographic is broad and cross-generational, Chris says. “The brand’s been around many years [since 1924], but today there’s a whole new generation that’s also reading the magazine, who see it as a trusted name. Even kids are familiar with the brand, even if they’re not reading the magazine.”
Almost 53 percent of its readership is in the 18- to 49-year-old demographic, according to Meredith.
The younger end of that range is a part of the consumer base that Chris has her sights set on, because that generation will fuel the industry’s growth in the decades ahead and is a main reason forecasters are so bullish on the long-term structural growth of real estate.
To woo them, the company plans to start with an Internet presence that will appeal to tech-savvy households. That will mean leveraging the kind of interactive and social-networking features that are typically thought of in a Web 2.0 context, Chris says.
The goal will be to marry that technology focus with a traditional, full-service approach to brokerage, she says.
The Better Homes and Gardens brand isn’t a newcomer to real estate. Meredith owned its own real estate company under that name for 20 years, selling it in 1998, along with licensing rights to the name for 10 years, to GMAC Real Estate. At the time of sale, the company had about 26,000 sales associates in 1,500 offices in the United States, Canada, and elsewhere.
The new BHG is still developing its uniform franchise offering circular, so Chris couldn’t talk about franchise and other fees, but she says they would be competitive. Franchise fees for established, national brand names average about $25,000, with an average 6 percent annual royalty, according to data from REALTOR® magazine’s 2007 franchise report (see “ Affiliation up ,” September 2007, page FB2).