Building a nation, one house at a time
(Excerpts from the presentation of Januario Jesus Gregorio B. Atencio III, president of 8990 Holdings, at the Ateneo Graduate School of Business)
“You can imagine my excitement, mixed with a little apprehension, when my classmate and good friend for 38 years, Rudy Ang, my favorite dean, asked me to spend some minutes tonight to share with you the 8990 story.
It’s a story that began with a gathering just like this.
I was seated at a developer’s conference with Luis Yu, our founder and chairman emeritus, and Marin Martinez, our chairman, when the idea of forming 8990 was first broached. I ended up being the third partner and CEO, and it’s been a great 13 years.
Now all stories have a context. And for me, my context is: 500 years ago, where did we live? How did property ownership evolve to what it is today, and being businessmen in the 21st century, how do we make a difference that’s big?
It’s more fun in the Philippines when you consider a nation of 7,107 islands with 175 dialects, a young population of 104 million, remittances totaling P3 billion in 2016, per capita incomes of $3,500, a GDP growth of 6.5 percent every year for the past 15 years.
But it is also a country, where 50 percent of adults do not own any property, a housing backlog of 5.5 million growing 5 percent every year, and a housing industry that can produce 250,000 homes annually.
In our 13 years as 8990, we’ve grown from one branch in Cebu to eight across the nation, 49 completed projects and 18 ongoing. We’ve delivered more than 50,000 housing units, making us the largest builder in the affordable housing space in the (country) today.
Let’s take a look at our buyers. Once upon a time, it was enough for us to know the customer. Today, it’s about getting to the core of what drives our customers (and) allows us to develop housing products that solve his problems, and to create a branded customer experience that understands his potentials as well as his limits.
Now, it may come as a surprise that 58 percent of our buyers are young.
Without a doubt, the new and emerging market for affordable housing are millennials. That means, while these young, tech-oriented, information-driven Filipinos have adequate cashflows for housing, and will have increasing income levels as they get older, they don’t have the savings for a huge downpayment today.
To be successful today is to tap into the millennial market. Key to this is communication. Part of the core message is affordability. And so we must communicate this effectively.
For millennials, it’s more about the how of things, not just the what of it. It’s giving them infographics that they can understand at a glance, and information that they can easily relate to. It’s about using social media, facebook, viber and Instagram, hand in hand with traditional fliers, brochures, billboards and tarpulins.
In our case, a truly effective mass housing program must be grounded on and understand the reality and psychology of how a young working class Filipino lives, earns, saves and spends money today.
And the more we are able to fit our product, our housing finance and our customer service to this market, the more successful our business becomes.