Wednesday, November 21, 2018

Tulsa Marketing Strategy Not OK

The city of Tulsa just joined a list of cities offering incentives to gain new residents, with their approach of offering $10,000 to 'employees' who move there.

In theory, this would attract attention. However, as we know in real estate, attracting attention isn't always a positive, while this is an industry that needs a lot more positives from day to day.

CNBC's story about this provided details about the requirements, which were clearly not well thought out.

Their concept is that its "Tulsa Remote" Grant program will pay an employee $10,000 over the course of one year for moving to the city or County of Tulsa, and work remotely for an out of area employer.

From a financial standpoint, the structure doesn't make sense. The first part is a $2,500 "relocation fee".  By the time someone from a long distance away deals with moving expenses, that amount could be gone and then some.

That amount does not take into account a security deposit or 'last month' rent on an apartment, and certainly is zero help when it comes to a possible down payment on a home.

Remaining funds would be paid off at $500 per month with a "final" $1,500 check at the end of the one year period. It is difficult to determine whether this would be enough of an incentive to keep someone living there for one year if they wind up not liking the city.

However, this program was put together without considering the marketing and real estate impact this publicity stunt gives. From here (well outside of Tulsa), this is NOT a well thought out approach. And how the $10,000 is paid out has no bearing either way.

First of all, those who are skeptical will take the approach of "They couldn't pay me enough to live there!" and see this as desperation to attract more residents.

Employees that work remotely often do so because of family or other personal considerations and are not able to relocate. Employers may not wish to have remote employees work beyond a certain distance or out of area regardless of performance

More importantly, the real estate aspect of this is all wrong.

If Tulsa wants to increase the population and the economy, this offer should be coming on behalf of employers in the area. A "Get Hired by Tulsa Business and Get $10,000" Campaign would spur activity for this Grant.

It might also lead to more employers wanting to participate, and perhaps building or expanding their office, store, or factory to or within Tulsa County. Which, of course, means more commercial development and helps the local economy.

This was not well thought out. Or, it could be that they don't want to pay out any money, thinking that this will be a favorable publicity stunt. They seem to have overlooked the "favorable" part.

Here is the story:

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