Real Estate Marketing with the emphasis on communication politics as an instrument of sales with applicable suggestions for the Entwicklungsgesellschaft Cité in Baden-Baden
©2003
Bachelorarbeit
80 Seiten
Zusammenfassung
Inhaltsangabe:Abstract:
The overall situation in the housing and real estate market has changed drastically in the last few years. The market structure has changed due to an overcapacity of empty or not used private flats, houses, etc. and an increasing competition among providers. In the earlier days, buyers depended on the real estate offers from real estate companies. Nowadays buyers are offered a huge number of real estate products and have almost uncountable sources of information at hand.
Triggering these changes at the beginning nineties was the re-integration of the German Democratic Republic to the Federal Republic of Germany with a huge over capacity of housing space, the migration of eastern German workers to the western part and the internet, which allowed consumers without a lot of hassle to compare various real estate products. Additionally a lot of construction companies rejected considering the necessary infrastructure for their projects, which is a major factor in the decision process of the consumers. Another development caused by the re-integration of the eastern part was the mistrust towards the real estate industry. A lot of companies from the west hoped to make a fast fortune in the east. They left unfinished buildings, mountains of debt and housing space, for which there were no tenants. Bankruptcy was the end of such companies. The redundancy of the former eastern block in Europe and the Perestroika (the new political policy of Russia) lead to the reduction or closing of Allied bases in Germany. This created free areas with military structures on them, which can be found all over Germany the Cité area is such a case.
All these factors lead to a decreased need of the consumers and to an over capacity of housing space.
In order to deal with these external factors of influence and to secure and to extend their own market share, companies have to orientate themselves towards potential customers.
The customer has to be put into the centre of the corporate philosophy, since those times when customers stood in line to get the product have ended.
Therefore the marketing activities have to be adjusted to the needs of the users of real estate.
Goal of this bachelor thesis is, to show that a real estate company can only be successful on the private real estate market, if it operates structured communication politics and if it is orientated to the market.
To support this thesis this paper will only focus on the […]
The overall situation in the housing and real estate market has changed drastically in the last few years. The market structure has changed due to an overcapacity of empty or not used private flats, houses, etc. and an increasing competition among providers. In the earlier days, buyers depended on the real estate offers from real estate companies. Nowadays buyers are offered a huge number of real estate products and have almost uncountable sources of information at hand.
Triggering these changes at the beginning nineties was the re-integration of the German Democratic Republic to the Federal Republic of Germany with a huge over capacity of housing space, the migration of eastern German workers to the western part and the internet, which allowed consumers without a lot of hassle to compare various real estate products. Additionally a lot of construction companies rejected considering the necessary infrastructure for their projects, which is a major factor in the decision process of the consumers. Another development caused by the re-integration of the eastern part was the mistrust towards the real estate industry. A lot of companies from the west hoped to make a fast fortune in the east. They left unfinished buildings, mountains of debt and housing space, for which there were no tenants. Bankruptcy was the end of such companies. The redundancy of the former eastern block in Europe and the Perestroika (the new political policy of Russia) lead to the reduction or closing of Allied bases in Germany. This created free areas with military structures on them, which can be found all over Germany the Cité area is such a case.
All these factors lead to a decreased need of the consumers and to an over capacity of housing space.
In order to deal with these external factors of influence and to secure and to extend their own market share, companies have to orientate themselves towards potential customers.
The customer has to be put into the centre of the corporate philosophy, since those times when customers stood in line to get the product have ended.
Therefore the marketing activities have to be adjusted to the needs of the users of real estate.
Goal of this bachelor thesis is, to show that a real estate company can only be successful on the private real estate market, if it operates structured communication politics and if it is orientated to the market.
To support this thesis this paper will only focus on the […]
Leseprobe
Inhaltsverzeichnis
ID 7568
Geiger, Daniel: Real Estate Marketing with the emphasis on communication politics as an
instrument of sales with applicable suggestions for the Entwicklungsgesellschaft Cité in
Baden-Baden
Hamburg: Diplomica GmbH, 2004
Zugl.: Fachhochschule Furtwangen, Fachhochschule, BA-Thesis/Bachelor, 2003
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Printed in Germany
II
Content
Page
1. The Marketing Environment of the Entwicklungsgesellschaft
Cité mbH
1
1.1. Introduction to the Environmental Analysis
1
1.2.
Definition
Conversion
Area 1
1.3.
Macro
Analysis
with
the
PEST-Factors
2
1.3.1.
Political
and
Legal
Factors
2
1.3.2.
Economic
Factors
3
1.3.3.
Social
Factors 5
1.3.4.
Technological
Factors
6
1.4. Micro Analysis with the SWOT-Analysis
7
1.4.1.
Strengths
7
1.4.2.
Weaknesses
8
1.4.3.
Opportunities
8
1.4.4.
Threats 8
1.5.
The
Real
Estate
Market
Today
9
2.
Private
Real
Estate
Marketing 11
2.1.
Definition
of
Real
Estate
Marketing
11
2.1.1. Content and Goals of the Marketing-Mix Instruments in the
Private
Real
Estate
Market
12
2.2. Characteristics of the Private Real Estate
13
3. Factors of Influence and Choice Criteria in a Real Estate Purchase
16
3.1.
The
Basic
Need
of
Living
17
3.2. Value Expectations of Customers Buying Private Real Estate
18
4. Communication Politics in the Private Real Estate Market
20
4.1.
Definition
of
Communication
Politics
21
4.2. Principles and Goals of Communication Politics
22
4.3.
Steps
in
the
Communication
Plan 25
4.3.1. Formulation of the Communicational Goals
25
4.3.2. Target Group Segmentation for Communicational Actions
26
III
4.3.3. Defining of a Communication Strategy
29
4.3.4.
Setting
a
Communication
Budget
31
4.3.5.
Deployment
of
Communication
Tools
33
4.3.6. Implementation and Control of the Planed Measures
36
5. Presentation of the Communication Instruments
39
5.1. Corporate Identity Requirement for the Communication
Instruments
40
5.2.
Classic
Media
Channels
41
5.2.1.
Print
Advertising
42
5.2.2. Other Classical Communication Instruments
46
5.3.
Direct
Marketing
48
5.4.
Event
Marketing
50
5.5. Internet Marketing & Digital Media
53
5.6.
Construction
Site
Marketing
55
5.7.
Public
Relations
56
5.7.1.
Sponsoring
59
5.7.2.
Relationship-Marketing
61
5.8.
After
Sales
Marketing
61
6.
Conclusion
63
7.
Bibliography
65
IV
Illustration
Page
Illustration 1: Finished Constructions in Germany
4
Illustration 2: Age Structure in the Federal Republic of Germany
6
Illustration
3:
Real
Estate
Life
Cycle
14
Illustration
4:
Marketing
Instruments
15
Illustration 5: Reasons for Private Property
16
Illustration 6: Media Sources for First Contact
20
Illustration
7:
The
Communication
Process
23
Illustration 8: Responsibilities of
PR-Departments
23
Illustration 9: Target Groups of Public Relations
24
Illustration 10: Target Groups of
Communication
Politics
27
Illustration 11: The Target Group Definition Process
29
Illustration
12:
Communication
Plan
35
Illustration
13:
Traditional
Advertising
Efforts
39
Illustration
14:
Objective-Instrument-Matrix
40
Illustration 15: Target Group-Instrument-Matrix
40
Illustration 16: Target Groups and Objectives of Direct Marketing
48
Illustration 17: Deployment of Direct Marketing Measures in Germany
50
Illustration 18: Target Groups and Objectives of Event Marketing
52
Illustration 19: Target Groups and Objectives of the Internet
53
Illustration 20: Target Groups and Objectives of Press Work
58
Illustration 21: Sponsoring-Types and their Meaning in the Real Estate Sector
60
Illustration 22: Target Groups and Objectives
of
Sponsoring
60
V
Preface
The overall situation in the housing and real estate market has changed drastically in
the last few years. The market structure has changed due to an overcapacity of
empty or not used private flats, houses, etc. and an increasing competition among
providers. In the earlier days, buyers depended on the real estate offers from real
estate companies. Nowadays buyers are offered a huge number of real estate
products and have almost uncountable sources of information at hand.
Triggering these changes at the beginning nineties was the re-integration of the
German Democratic Republic to the Federal Republic of Germany with a huge over
capacity of housing space, the migration of eastern German workers to the western
part and the internet, which allowed consumers without a lot of hassle to compare
various real estate products. Additionally a lot of construction companies rejected
considering the necessary infrastructure for their projects, which is a major factor in
the decision process of the consumers. Another development caused by the re-
integration of the eastern part was the mistrust towards the real estate industry. A lot
of companies from the west hoped to make a fast fortune in the east. They left
unfinished buildings, mountains of debt and housing space, for which there were no
tenants. Bankruptcy was the end of such companies. The redundancy of the former
eastern block in Europe and the "Perestroika" (the new political policy of Russia) lead
to the reduction or closing of Allied bases in Germany. This created free areas with
military structures on them, which can be found all over Germany the Cité area is
such a case.
All these factors lead to a decreased need of the consumers and to an over capacity
of housing space.
VI
Aim of this Bachelor Thesis
In order to deal with these external factors of influence and to secure and to extend
their own market share, companies have to orientate themselves towards potential
customers.
The customer has to be put into the centre of the corporate philosophy, since those
times when customers stood in line to get the product have ended.
,,Therefore the marketing activities have to be adjusted to the needs of the users of
real estate."
1
Goal of this bachelor thesis is, to show that a real estate company can only be
successful on the private real estate market, if it operates structured communication
politics and if it is orientated to the market.
To support this thesis this paper will only focus on the communication politics of the
company, because this plays an important and vital role in the real estate business.
One reason among many is the fact, that real estate usually has a high purchase
value and involves a lot and important decisions among its buyers. Therefore, in
most of the cases the right communication politics of a company decide, whether real
estate is being sold or not.
As introduction this paper will analyse all internal and external factors that influence
the Entwicklungsgesellschaft Cité.
Afterwards the real estate market will be examined. Then the characteristics of the
private real estate will be analysed and underlined, with a view to the attributes
people attach to housing.
The next steps are then to show the company the elements of the communication
planning process and to show the communicational instruments with their various
operational areas, in order to successfully market private real estate. This will be
undertaken by examples and suggestions for the Cité
1
FALK, Bernd S.23
VII
Methodology
The methodology is about how relevant information is being collected and from which
sources it is retrieved.
It is very important for the first part of this paper (PEST, SWOT analyses and the
market overview) to gather up-to-date information. This happens according to the fact
that the working environment of the Cité is never static and constantly exposed to
internal and external changes. With the help of this analysis areas can be identified
and shown, that need an intensification of the usage of the communicational
instruments. Also totally new areas can be identified as an aim for the communication
politics. The collection of information will be based on primary and secondary data
sources. Personal interviews, up-to-date reports and as secondary sources mainly
magazines and the Internet. The choice of these sources will help to create an
current situational picture of the Cité environment and the market it operates in.
For the following part of this paper I will then mostly rely on secondary literature,
because in this part it is important to access previously generated data, in order to
reach relevant and efficient conclusions. I will also use tertiary literature to get access
to more sources of information. It is not a necessity that these sources are connected
to the real estate sector. Other sectors can also deliver important and applicable
information. Another reason behind this is, that this could be a chance to create new
innovative ideas based on experiences from other sectors.
VIII
Introduction of the Entwicklungsgesellschaft Cité mbH
The Entwicklungsgesellschaft Cité mbH is responsible for the planning and execution
of the conversion of the former military base of the French Armed Forces in Baden-
Baden.
To the 40 hectares conversional area belongs the housing area "Cité" with
approximately 1000 housing units and the area of the ",,Maréchal de Lattre de
Tassigny"- army camp. These areas were bought by the Entwicklungsgesellschaft
Cité in 2001 for almost 25 million Euros from the German government. The duration
of the re-integration into the city of Baden-Baden will take 10 to 15 years. The reason
for the long re-integration phase is the fact, that approximately 90 percent of the
existing building have to be torn down, since there is no demand for such housing
and due to the bad condition of some of the buildings.
The overall costs for re-constructing old buildings, preparing the lots and creating the
necessary infrastructure until the end of the project will be approximately 200 million
Euros.
The operating structure of the Cité consists of one operational working CEO, four
authorized clerks, one commercial and one technical project manager and one
secretary. Additionally the Cité works closely together with the administration of the
city of Baden-Baden in order to undertake the conversion without unnecessary
tension and to guarantee the interests of the city and its inhabitants.
Main goals are the environmental friendly dismantling of the existing buildings, the
slow re-development of a whole city district with housing areas, educational
institutions, companies and the generation of new jobs.
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1
1. The Marketing Environment of the Entwicklungsgesellschaft Cité
mbH
1.1. Introduction to the Environmental Analysis
A market-oriented organisation should always closely observe and analyse its
environment, because there could be new chances waiting or threats could emerge
which might threaten the existence of the organisation. If these factors of influence,
either good or bad, are discovered they can be influenced by a well defined and
structured plan of communicational politics.
The aim here is to take a close view at the environment of the Cité and to discover
possible factors of influence, which have a direct or indirect influence on the business
the organisation runs.
1.2. Definition Conversion Area
One aspect, which has to be considered in the environmental analysis and also
regards the ways of communication policy is the fact, that the building site is a
conversion area.
A conversion area can be defined as:
The word conversion comes from the Latin language and means change
transformation or departure. The differentiation here is being done between a military
and a civilian conversion.
The military conversion includes:
the re-use of former military used areas for civilian purposes,
the re-use of former defence related factories for civil production,
the removal or softening of the negative economical effects through small or
medium projects within the converted area on the bases of a regional strategy,
stabilising and supportive measures for the local construction business, limited
to the early phase of a conversion
2
2
Compare, www.konversion.com
Real Estate Marketing
2
The civilian conversion includes:
the transformation of all idle non-military areas in a city and/or region with
political significances (for example train-, postal- services, business and
industry); trigger here is the normal structural change.
The accomplishment of mastering the general structural change under
economic, urban and social viewpoints of areas and/or districts (for example in
re-development and development zones.
3
The conditions for the mastering of the military and civil conversion are comparable
and require similar strategies and the use of corresponding instruments.
In order to get an overview, an analysis of the influential factors of the micro- and
macro-environment analysis will now follow.
1.3. Macro Analysis with the PEST-Factors
The macro environment consists of the political and legal, economic, social and
technological factors. These factors influence the company's businesses where the
company has only a limited influence on them. It also influences the other
participants of the micro environment, which are related to the company. In order to
get an insight, the following part will highlight the influential factors of the Cité´s
macro environment.
1.3.1. Political and Legal factors
The taxation and the politics in the Federal Republic of Germany support those
private households, which have strong financial obligations. Therefore the taking of
a credit for the purchase of a real estate is supported indirectly by the government.
For example the possibility exists that with the purchase of private real estate (of
which the intention is to lease it to somebody) the opportunity arises to write off the
incurred expenses. Further the state offers the possibility of the asset-generating
achievements (Vermögenswirksame Leistung). This concerns a tax-free subsidy
from the employer.
3
Compare, www.konversion.com
Real Estate Marketing
3
Promoted for example is the building loan savings plan as a private real estate
market relevant investment form. In addition the state gives a homeowner benefit for
people who use the real estate privately. This means the benefit for a newly build
house is a lump sum of approximately 2500 Euro, plus an additional 750 Euro per
child. This benefit applies as well when a building is being renovated. Here the lump
sum is only 1250 Euro.
The speculation tax has a negative effect on the real estate market, which
discourages a lot of investors. Achieved profits made through the sale of real estate
have to be taxed. When the investor wants to realise the full profit without the tax he
has to wait at least 10 years.
Also the non consistent direction of the governing party can have a negative effect on
the business. Here new laws or the ones which are still in the pipeline can further
harm and intensify the real estate market and also lead to an insecurity among
investors.
1.3.2. Economic Factors
The overall economical factors are very important factors for the Cité, since the
acquisition value of private real estate is very high and the fact that they are often
seen as an investment (which means for the real estate that it is in direct competition
with other investment products).
An essential economical factor is the poor growth of the economy in the Federal
Republic of Germany, which was in 2002 at 0.6 percent and in the years before
declining (partly even a negative percentage).
As well the proceeding inflation with 1.5 percent in the year 2002 influences the
investors insofar that they are investing their money in "Save Havens" (abroad),
where they are able to achieve higher returns with almost none or even without
taxes. In addition activated through the stock market boom in the second half of the
nineties a lot of investors tried their luck with stocks, rather than investing in real
estate. They were lucky and had a higher ROI until the crash on the stock market.
An additional economical factor of influence is the detail that at the moment there is
hardly the chance to achieve profits with real estate respectively that these hardly
manage to make the inflational adjustment.
Real Estate Marketing
4
Due to the above-mentioned points, the increasing numbers of unemployed and the
uncertain and poor economic situation, the number of construction completions has
steadily decreased, visualized in illustration 1.
Illustration 1: Finished Constructions in Germany
4
But there are also certain indicators, which brighten up the outlook of the economical
factors influencing the Cité.
First of all the interest rates in order to activate the economy are at an extremely low
level, which really encourages people to take a loan in order to finance their own new
home. A good example for this can be observed in the United States. There a lot of
real estate owners have loans for two, sometimes even three houses. A similar effect
would also be feasible in Germany, if interest rates will further decrease.
The truth is, that it is really worthwhile at an early age to get one´s own property and
instead of paying the rent to pay off the loan. But this way of thinking is yet not too
common in Germany
4
http://www.bulwien.de/english/chart.php3, (y-axes values in thousand, magenta=overall numbers of
dwellings, dark red=dwellings in new one-/ two-family houses, yellow=rent dwellings,
orange=condominium)
Real Estate Marketing
5
Secondly the lots of disappointed investors from the stock market could mean a
major turn around on the real estate market are, leaving stocks alone and look for
their investment in substantial values, for example real estate.
The purchasing power of the people, is another point, which has a substantial
influence on the demand for private property. "Who has more money in his pocket,
can and will habituate in a better way".
5
The growth of the purchasing power has steadily decreased in the last few years in
Germany and has now come to a standstill. In addition to this, the uncertainty on the
job market is growing, causing people to try to keep financial obligations as low as
possible.
1.3.3. Social Factors
A very important factor in Germany is the change of the population structure which is
visualised in illustration 2. The overall number of people living in the Federal Republic
will decrease by the year 2050 from 82 Million to 60 Million. Thereby the average age
and the fraction of older people from the population will continue to increase (share of
the 50-60 year olds: 2001/ 30,4%, 2010/ 31,7%, 2020/ 39,5%)
6
, which then will lead
from a former pyramid to a mushroom shape.
This age structure in Baden-Baden turns out to be even extremer, due to the
popularity of the city among senior people and its strong infrastructure in the health
sector.
Also the trend to the small family continues further and the amount of the single
households has increased in the course of the last years. These factors change the
requirements that are expected from real estate. For example building flats to the
needs of senior citizen or building living spaces for small families.
A positive aspect is the capital available in the next few years that will be inherited.
Here notable assets will shift from one generation to the following. These amounts
will exceed that of the earlier years by far. Here an opportunity arises of which the
company could benefit. Also the advantages of their own real estate have always
been appreciated by people, because it guarantees a rent-free living in old age and
therefore relief from financial obligations.
5
JUST, T., DB-Research, 2003
6
Compare, Statistisches Bundesamt, July 2001
Real Estate Marketing
6
Illustration 2: Age Structure in the Federal Republic of Germany
7
1.3.4. Technological Factors
Technological factors that could have an influence on the Cité project are for
example new materials used for construction. Because in recent years many cases
occurred, in which incorrect or contaminated building materials (e.g. asbestos) were
used, critical materials could be replaced here with possible new and alternative
materials.
7
Statistisches Bundesamt Report, 2002, (age pyramid of Germany regarding influencal factors like the
1
st
& 2
nd
world war, the economic crisis in 1932 etc. x-axes=thousands per year of age, y-axes=age in
years, left side male, right side female)
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7
In addition a possibility is offered to apply in the project new building procedures and
the use of new technologies. For example new energy winning procedures could be
furnished into the houses, which would offer the possibility of autarkic (e.g. newest
photovoltaic cells technology) or there could be new standards in the area of the
passive houses. It is important to observe the market closely in order to be informed
of new technological developments and to be able to offer this development as well.
1.4. Micro Analysis with the SWOT-Analysis
The microenvironment is the direct and close environment of an organisation, which
can strongly influence its operations. To micro factors belong, the suppliers, the
distributors, the competition and the customers. With the help of the SWOT-analysis
(strengths-, weaknesses-, opportunities- und threats) the micro environment of the
Cité will now be reviewed.
1.4.1. Strengths
Its good connections with the community and the local politics are one of the large
strengths of the Cité. This enables on one hand very good financing possibilities in
various institutions and eases permission procedures that are important for the
project.
A further strength is the structural construction of the company's personnel
resources, since the know-how from various areas is joined together (e.g. colleagues
out of the local politics, the law sector, the banking sector etc.).
This variety is also enriched further, through the experiences of the employees.
Because one part of the employees gathered experience in the free economy and
the other part was working in the civil service, the Cité has a large knowledge pool at
its disposal.
A further strength, is the good relationships and contacts to local business, especially
those businesses that are involved in the project in a direct or indirect way. Through
these facts various opportunities arise to exploit these contacts and resources for the
welfare of the company.
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1.4.2. Weaknesses
A large deficiency is the slowerness, with which decisions in the organisation are
made. This is caused by the large number of decision makers and their different
level of influencial strength. The decision process is also affected by decisions from
other bodies, which are being influenced by the city council of the city of Baden-
Baden. These factors partially restrict a flexible decision making process.
Further the broad field of activities accounts for another additional problem factor.
Due to the fact that the product range is not only limited to private realty but also
service / industry realty, this sometimes leads to under capacities in the staffing of
the organisation. The broad market segment which has to be covered by staff is
another problem, since there is sometimes a know-how gap, which occurs when
specific knowledge in the regarding segment is needed.
1.4.3.Opportunities
By serving the private- and service/ industrial real estate segment, the Cité has
opened itself the opportunity even in weak phases in the respective segment to
intensify their activities in the other segment, by which they secure profits for their
organisation.
Due to the partnership with the city Baden-Baden the Cité is able to offer various real
estate products and if necessary legal requirements regarding constructional
requirements can be changed.
This is an additional advantage, which is not available to other property developers
and competitors, since those are bonded to the constructional requirements of the
corresponding community/ city. Through the construction of the shopping centre in
the Cité district another opportunity evolved which increased on the one hand the
value of the building ground and on the other hand its attractivity.
1.4.4. Threats
Due to the close relations to the city council of Baden-Baden financial problems could
evolve if the city may encounter financial problems. Also a political change in the city
council could lead to problems in the support for the Cité project in for example
approval procedures.
Real Estate Marketing
9
Denials of approval for certain construction steps or new rules and regulations
imposed by the federal state or by the government (e.g. de- or increase of the
interest rates) could happen, which are not foreseeable. Also competition could arise
from similar projects in other surrounding towns, where competitors could try to offer
and sell similar products. In addition it could happen that the product range offered
might not comply with the needs of the market, so that these will not be able to find
buyers.
Natural caused catastrophes are nowadays also a very important factor, which could
have an impact on the project and its success. These could be for example floods
(this has happened many times in Baden-Baden already), which could damage for
example its infrastructure already in the starting phase of the project. And as a last
point an aggravation in the real estate market poses of course also another major
threat to the Cité.
1.5. The Real Estate Market Today
The real estate market nowadays is still among the turnover-leaders in the major
traditional industries with the highest turnovers in Germany, even though the turnover
has declined from 160,6 billion euros in the year 1995 to 126,6 billion euro in 2000.
This large decline is a result from major changes in the market, which are:
Change of the market structure from a price taker market to a price maker
market, which depends on the supply and demand function. Due to the fact
that oversaturation on the real estate market has happened the buyers have
now the opportunity to freely choose, which also leads to a strong decline in
prices.
A different legislation, which gives more rights to buyers and tenants
nowadays has lead to the fact that investors approach real estate more
reservely and makes them think twice whether they should go ahead and
invest in private real estate. Additionally this trend was consolidated by the
booming stock market in the last few years before the downturn.
The German economic situation is at the moment characterised by, steadily
increasing numbers of unemployed, deficits in the household budgets, and the
decline in orders and turnovers.
Details
- Seiten
- Erscheinungsform
- Originalausgabe
- Erscheinungsjahr
- 2003
- ISBN (eBook)
- 9783832475680
- ISBN (Paperback)
- 9783838675688
- DOI
- 10.3239/9783832475680
- Dateigröße
- 922 KB
- Sprache
- Englisch
- Institution / Hochschule
- Hochschule Furtwangen – Wirtschaft
- Erscheinungsdatum
- 2004 (Januar)
- Note
- 1,8
- Schlagworte
- advertising marketing environment real estate presentation media channel
- Produktsicherheit
- Diplom.de
