Builders are starting to use sales and marketing effectiveness (SME) software, such as Online Insight from Online Insight Inc., to find out what customers are thinking in real time.

The reason many builders have opted for Online Insight is that the software analyzes up-to-date preference information, such as whether a customer is willing to opt for a favorite school district in exchange for a guest room for an aging parent.

In contrast, customer relationship management (CRM) software only goes so far. It gives builders demographic information, such as how many married couples with incomes above $75,000 purchased certain models in the past economic quarter or year, but it can't analyze preference information.

Builders find that using Online Insight allows them to meet three basic goals: (1) Knowing consumer preferences in real time lets salespeople guide home buyers through the purchasing process more effectively. (2) Builders better understand what types of communities to build and where to build them. (3) It helps their buyers gain insight into their housing preferences, which helps them more quickly identify their ideal home.

Online Insight automates the standard market research techniques that business marketers have used for years to analyze customer preferences. Ferreting out preferences from a 100-person focus group used to take all day. Now, the interviews are done individually online in about five minutes.

The software asks customers questions such as where they want to live, how much they are willing to pay for each feature, which amenities they value most, and what tradeoffs they are willing to make.

The first generation of SME tools focused on generating sales leads. Online Insight takes the technology a step further, letting builders develop customer profiles through a series of real-time interviews. Rarely are two surveys the same, because each consumer expresses different preferences. Customers receive individual profiles rating their buying preferences on home features, from appliances to neighborhood location. Then they click on a list of homes that corresponds to their profile.

In the two years since Beazer Homes deployed Online Insight, the software has helped reduce from 15 to five the number of home types salespeople show customers. Also: The number of days homes stay on the market has dropped 5 percent. Beazer reports that before it started using Online Insight, the average Beazer home stayed on the market for more than 45 days before being sold.

"There's no question that those who complete the tool are more likely to come into the sales office, and they're coming in better informed," says Jonathan Smoke, Beazer's CIO. "It's also cut down on our sales cycle."

Beazer is rated sixth in Builder magazine's Builder 100 listing, with $2.9 billion in sales and 14,720 closings in 2002. A company of that size can afford the several thousand dollars it costs to get Online Insight up and running. The good news for smaller builders--at least in the Atlanta area--is that Prudential Georgia Realty started using Online Insight this past August.

Cathy Wozniak, director of the company's new homes division, says Prudential Georgia Realty made the tool accessible to 25 builders representing 15 communities. The average builder Wozniak represents closes 100 to 150 homes a year. She says Prudential Georgia Realty absorbed the cost of the software as part of its marketing expenses.