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Special Issue Report: The People's Choice

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In the age of personalization and customization, organizations selling to consumers must make themselves adaptable. Just take a look at what the myriad retail Web sites today offer Internet shoppers:

  • Customers choose their shopping hours.
  • Shoppers choose from wide selections; inventory is seldom an issue.
  • Customer behavior and preference shape retailers' interactive promos.

The Internet has changed not only the retail market but also customers' expectations. No customer expects less personalized attention when he or she commits to spend $500,000 or even $750,000 for a new home than when spending, say, $30 for a best-selling book.

FOCUS: BUYERS' OBJECTIVES

Eliant research highlights buyers' objectives during the construction and design options selection phase. For your customer, it's about personalization; for you, it's about adaptability:

  • The opportunity to personalize is often the key reason for buying a new rather than a resale home.
  • Most people need design guidance (although they seldom say so unless you ask).
  • Exposed to a long list of options, customers fear being overwhelmed by them; choices that apply to their lifestyle are what they prefer.
  • They perceive “standard options” as inferior and insulting.
  • Buyers want reasonable timelines, not irrationally restrictive cutoff dates, to make complex selections.

As home buyers' demand for a custom production home becomes clearer:

  • Showrooms demonstrate more products and accommodate more buyers at one time.
  • There's a trend back toward on-site showrooms for increased convenience.
  • Online options programs also add convenience.
  • Bundled options, borrowed from the auto industry, ease confusion.
  • Design professionals increasingly serve buyers in a design consultant role to increase the perceived value of the experience.

As commendable as these steps are, there are other ways to improve how you deliver on the promise of personalization.

CUSTOMER INTEGRATION, BY DESIGN

A buyer wants to feel fully integrated into the process. For you, this means a commitment to a “we” experience. “The only way to develop trust is for your designers and their home buyers to be partners in the design experience,” says Nancy Giangeruso, president of Irvine, Calif.-based Chateau Interiors. “At all costs, we want to avoid becoming ‘order takers.' ”

Integration extends across a builder's team—purchase consultants, superintendents, and vendors—who need to be in sync before the buyer enters the picture. Information collected during the sales process about the buyer's lifestyle and particular tastes must funnel through to the design consultant to allow for a more customized set of design recommendations. This smooth hand-off is one of the hallmarks of firms with the highest-rated design teams.

Design firms routinely train personnel on product knowledge and selling skills. However, only a handful include customer-care skills as part of their training regimen.

The two major components you must consider part of your customer-care approach are:

Touchpoint analysis/enhancement

  • Required touchpoints are those that must be conducted to complete your design process.
  • Extraordinary touchpoints are things done for the buyer that he/she does not anticipate.
  • Both types of touchpoints must be delivered in a manner that a buyer never expects.
  • Each department develops a list of several extraordinary touchpoints and allows each rep to select the one that will have the most impact on each buyer.

For example:

  • Child-care coupon for the first design center visit;
  • Tour of a neighbor's home to see some of the options in real life; and
  • Take the buyer on a tour of one or more models to get ideas.

Setting realistic expectations

*You must include all team members in this training process.

-Salespeople must set the proper expectations for the buyer's personalization experience; and

-Designers must set realistic expectations for the construction and finance phase of the buyer's experience.

* Expectations are set for the express purpose of beating them.

PROGRAM MOTIVATION

Motivational programs will help design staff learn to focus on customer care. Each program has pros and cons, but a combination of several approaches works best.

  • Tie bonus compensation to the buyers' ratings of the personalization experience (this recommendation is just as applicable to superintendents and other managers as it is to design consultants). Eliant recommends paying part of the designer's bonus based on buyers' ratings of “perceived value of the products and services offered.”
  • Special recognition events provide an opportunity to recognize top performers as well as reinforce the notion of your company becoming known as a customer-focused home builder.
  • Every meeting of design consultants should include a discussion about some element of the customer-care initiative or recognition of at least one person who has done an exceptional job of delivering a personalization experience.

The goal is to build trust between buyer and design consultant by offering personalization. To achieve this, your organization must show adaptability to each buyer's preferences.

–Bob Mirman is CEO and Alex Roqueta is president of Eliant in Irvine, Calif. For further info, visit www.eliant.com.

EXPECTATIONS 101: PERSONALIZATION

Personalization Sequence

  • Entire personalization sequence and timeline should be defined
  • The buyer's purchase counselor should set positive, unexaggerated expectations for working with the design consultant

Cutoff Dates

  • Rationale for and importance of firm cutoff dates should have already been set by the purchase counselor
  • Reinforce that these dates will not be modified

Your Response Time

  • Identify the target time promised to return buyer's calls to the design consultant
  • Make sure this target time can be beaten 95 percent of the time

Standard vs. Optional Features

  • Immediately clarify list of standard vs. optional features in each model (this should have already been done by the purchase counselor)
  • Set expectations for the buyer that not all demonstrated features are included; many are optional

FOR EXAMPLE: THE HIRE POWER IN DESIGN

“This is really a people story,” says Myra Calley, vice president of sales and marketing at Lennar's Northern Colorado division, when talking about the success of the division's design center. “Our designers help our families make their house into a home.”

Lennar's staffers strive to provide customers with an extraordinary experience. And they are keenly aware that any single person can have a lasting impact on a customer. As a result, some Lennar designers have gone to extraordinary lengths. For example, one designer got a call from a client just after move-in: A shutter was broken after one of the boys in the household threw a misguided baseball. The designer hauled out her toolbox and visited the home buyer the day of the call. Watching the designer repair the shutter herself was a memorable touch-point for the customer.

In another instance, when a designer learned of a serious illness in the client's family, she prepared and personally delivered food to their home for a week. These remarkable actions can and do inspire referrals for years to come.

Lennar makes a point of carefully interviewing and hiring the right people. The builder seeks individuals with good communication skills and plenty of passion, in addition to compassion and tolerance. “We pose a variety of circumstances and situations and ask how [candidates in an interview] would handle it,” says Calley. Once hired, designers often participate in seminars and meet with vendors to keep up-to-date on what's new and exciting.

Lennar recognizes that buying a home is an emotional time, so its teams focus on people and relationships. Customers receive a package at the beginning of the design process inviting them to participate in their home's design by presenting the design team with ideas, photos, tear sheets, drawings, and colors they might like to see in their new home. Moreover, recognizing that people's lives are busier and more hectic than ever, the company opens the center during off-business hours to accommodate customers' schedules.

QUOTEWORTHY: DAZZLED, NOT DIZZY

Most production builders offer a dizzying array of options and upgrades. While that sounds impressive, Eliant's new home buyer surveys report that many buyers actually are confused and frazzled by options overload. And designers' schedules are often too busy to allow time to learn about buyers in order to offer them a personalized guide of the options.

Chateau Interiors & Design has come up with a solution to this problem. For the 1,800 annual buyers from Warmington Homes and William Lyon Homes that Chateau deals with, there is a simple alternative to bringing the buyer to the design center to focus on what could be a stressful array of options. Instead, Chateau helps refocus the buyer's attention on the “finished design plan.” Staffers meet customers at the model and walk the home they just purchased.

“Each builder agreed that this was the extra touchpoint they were looking for with buyers,” says Nancy Giangeruso, Chateau's president, “but it was also clear that they had to adjust scheduling to accomplish this new task.” At the model, Chateau's design consultants ask buyers to talk about their plans. How will they actually live in this new home? What are their ideas for furniture placement, artwork, entertainment? Afterward, the buyers can view all of the options via Chateau's online options catalog. There, the buyer can check out pricing, use the mortgage calculator, and prioritize an options wishlist.

FOR EXAMPLE: MAKING THE CUT

An effective personalization tactic garners Pam Keller—and her team at Keller Homes—consistently high marks among home buyers. Of 200-plus builders rated by Eliant, Keller Homes' design center ranks No. 2 in the nation, with a 96 percent rating from home buyers. In addition, more than a third of Keller's sales come from referrals.

BB050915022L1.jpgOPTIONS ON POINT: From 2000 to 2004, the design and options selection process made steady gains with consumers. Builders must continually balance offering too few or too many options. Too few and buyers are disappointed. Too many and buyers are overwhelmed.Source: Eliant Move-In Survey 2000-2005

Paradoxically, it takes precise planning to make a home buying experience seem spontaneous. Setting realistic selection cutoffs and sticking to them is the first step, says Keller. At Keller, a home buyer gets 60 days to decide on all options.

Construction does not begin until both builder and buyer sign off on all option choices. A meeting between the home buyer and the builders' team leaders takes place expressly for this purpose. Everyone at the meeting becomes integral to the process, including the architect, estimator, site planner, superintendent, and design studio representative. “Because we do it all day, every day,” says Keller, “we have a tendency to think that customers automatically understand our business. But it is our job to explain it to them properly.”

Amid the fine-tuned machinery of setting expectations, personalization starts face-to-face. When a customer enters the design center at Keller, a sign greets him or her by name. Keller assigns each home buyer a design consultant (not a sales rep), who remains the sole designer throughout the process. The center itself serves one home buyer at a time, and buyers are invited to spend as much time as they like at the center—within those 60 days.