The Value of Having A System

ESI takes on "Impossible Challenge"

Haig Point, Daufauskie Island
Hilton Head, South Carolina

Haig Point, a high-end private community on Daufuskie Island, was severely under-performing when Len Ronnie Jr., president of International Paper Realty, decided to make a change.

Ronnie decided to outsource sales and marketing to ESI (known then as RMA) in June 1998, in an effort to turn things around at Haig Point. Founded in 1986, the community had managed to sell only about half of its 725 home sites in 12 years, and experts were predicting it would take another 12 years to sell out the remaining sites.

There was a perception that several major challenges hindered a turn-around of the stagnant community. Because the community was located on an island without a bridge, the only access to it was by private passenger ferry - a fact deemed by industry analysts as one negative that limited the desirability of the project. As a result, only seven home sites were sold from 1995 through mid-1998, creating a negative image within the Hilton Head real estate community. Although International Paper Realty was sustaining a regional and national marketing effort, sales were virtually non-existent and the reputation of the community was in decline. Several marketing consultants and research firms estimated it would take between 12-15 years to sell enough property to reach turnover. One major consulting company, Cushman & Wakefield, deemed Haig Point "a failed project that cannot be revived" in a 90-page market study conducted on the ailing community.

ESI was hired by International Paper Realty in February 1998 to conduct its own sales and marketing audit. In that audit, ESI uncovered many opportunities to increase sales and turn around Haig Point's image. The company was officially brought on board in June 1998 to handle the community's sales and marketing.

ESI installed an experienced sales, marketing and administrative team to implement the new plan. A targeted advertising message was created, new marketing programs were introduced and the ESI System was put in place. Within a few months the ESI System made an immediate impact, generating 38 sales for $5 million in just the first five months.

The next two years proved to be even more exciting. ESI increased prospect traffic over 600 percent, yielding 360 property sales for more than $75 million. Two exhibition marketing programs (Osprey Lakes home sites and Riverplace Cottages) produced 45 sales in two days. The combination of traditional marketing programs, exhibition/launch programs and a defined selling process led to the best three years in Haig Point's history. Property values also increased over the three year period by an average of 50 percent, with waterfront prices going from $400,000 to more than $1 million. Equity membership values began at $42,500 and, three years later, were selling for $75,000. International Paper Realty had achieved its goal of reaching turnover an amazing eight years earlier than the most optimistic projections.

"One of the interesting memories we have is the head of accounting calling us to report a problem," says Wilson Greene, president of ESI. "The problem turned out to be that for the first time in the 13-year history of the project they had a profit to report and weren't sure what to do with it. That's a good problem to have."