Avid Ratings Blog

It’s All About The Culture

Many years ago, when I was a young new home salesman, I had the misfortune to work with a Construction Superintendent who considered our customers to be an unwelcome interruption of his day. He grumbled his way through every encounter, treating them dismissively and disdainfully. Once, while conducting a final walk-through with a particularly finicky customer, who in his estimation was taking too long, he informed them at the foot of the stairs that they had 15 minutes to tour the second floor, after which he was leaving, finished or not. Not surprisingly, they were in my Sales Office in short order seeking intervention, and then spent several weekends parked outside the Sales Office, warning prospective buyers about how we treat our customers.

The company stood by the Superintendent, reinforcing his behaviors, in large part because he performed reasonably well in other areas, like budget control and construction schedules. The company thus demonstrated to me how they really feel about their customers, despite their public claims. I learned that taking care of customers was less important than protecting the company’s interests, that treating customers badly was acceptable. It spoke volumes about the company’s true priorities and culture.

As an Avid client, you already take customer satisfaction seriously, as evidenced by your commitment to tracking performance through Avid surveys. I hope that you also have vigorous mechanisms to act on gaps in your team’s performance in managing their customer relationships. To me though, it comes down to the kind of culture you create, the integrity and ethics you demonstrate, and the behaviors you embed in your company’s DNA.  Consider the following questions:

  • How often do you stress the importance of your company’s integrity and commitment to the customer in company communications, meetings and conversations with team members?
  • Are your key decisions based on what’s best for your customers? Do your decisions reflect your integrity and fairness toward customers?
  • Does your team consistently make decisions that are in the best interest of your customers, following your example? Can they predict how you would handle customer satisfaction issues when they arise?
  • How much recognition do you provide to team members who excel in serving their customers? Do you celebrate and publicize great customer care stories?
  • Do your employee performance reviews include discussion about their customer satisfaction scores and the quality of their relationships with customers? Are integrity and ethical behavior among your core values?
  • Do your incentive compensation plans include high customer satisfaction ratings as a condition of receiving bonuses?
  • Do you hire people partly on the basis of their values and expressed sensitivity toward customers and co-workers?
  • Do you tolerate employees like the Superintendent described above? (This question is particularly important. Having even one employee who treats customers badly sends a very loud message to all other employees!)

Your team looks to you for evidence of your personal integrity, and ethical and fair treatment of your customers, business partners, and them. Your decisions and actions speak louder than your words. Do you consistently “walk the talk”?

In a related topic, the Avid Team has been spending a lot of time lately discussing the importance of transparency and integrity in publishing customer satisfaction data. Some companies manipulate such data to improve their perceived standing among customers, an activity which is now illegal and subject to serious penalty if discovered. As important, those companies’ employees are surely aware of these actions, exposing management’s willingness to compromise the company’s integrity and ethical standing in a shortsighted attempt to boost sales.

A leader can’t be “mostly ethical” or demonstrate integrity most of the time. It’s an all or nothing proposition. That goes for how you treat your employees, your business partners and your customers. If that Superintendent works for you today, invite him to “seek excellence” elsewhere tomorrow.

How often do you stress the importance of integrity and commitment to the customer in your company’s internal communications and meetings?

Mastering the Homebuying Experience

Greetings Avid readers! First, I thank Paul Cardis for inviting me to join the Avid team as an Advisor, and for his confidence that I can contribute to helping Avid clients achieve high levels of customer delight. I look forward to working with Avid and perhaps with you.

Throughout my career in homebuilding, I have often had the responsibility to improve and enhance the homebuying experience for my company’s customers. During my years as VP for Quality for Hovnanian Enterprises, (and ultimately as SVP of Corporate Operations) we were successful in raising the customer satisfaction ratings from a worrisome 78% “willing to recommend” to a much more gratifying 96% in just a few short years. We accomplished this by focusing on three key areas – 1) creating a culture of commitment to the customer, 2) building a better-quality home and 3) redesigning the customer relationship (CRM) processes.

Certainly, you can’t provide a world-class experience for your customers if your employees don’t care about them. Further, building and delivering a high-quality home is an essential requirement. In this article, though, I’ll focus on the third “leg of the stool”, the CRM processes, which I believe are the most critical, and often most overlooked keys to creating “Raving Fans” among your customers.

First, a change of context. Most homebuilding companies don’t actually build anything. Very few of their (your) employees ever swing a hammer or hold a paintbrush. Your homes are designed and constructed by other companies you hire. You are a process management company, overseeing the processes by which your homes are built. In that sense, your relationship with your customers amounts to a series of encounters driven by operational processes. When those processes are poorly designed or executed, your relationships with your customers suffer.

When customers complain that they didn’t understand that optional features shown in your model aren’t included, the process of communicating standard features is flawed. When your Construction Manager doesn’t know that your customer added skylights at the Sales Office, your change order process is suspect. And when, 30 days before the contract closing date, you still haven’t notified your customer that the home will not be ready in time, your internal communication processes are broken. Breakdowns in your internal processes inevitably affect your customers. Fixing those processes, then, is the way to eliminate the negative outcomes that infuriate your customers and fuel dissatisfaction.

I recommend focusing on the customer experience from a process perspective. Begin by assessing each of the formal “touch points” with your customers. Are the included features carefully explained? Is the “beginning to end” process of buying a home fully outlined at contract signing? Is your Construction Manager prepared for the “Pre-Construction Meeting” where selected options, home siting and construction schedule are reviewed? (Do you conduct these meetings?) Do your customers know what to expect when they visit your Design Gallery? How often do you update them on the status of their home during construction?

Managing the customer experience is a matter of deeply understanding the processes you design to manage that experience. Setting clear expectations and communicating proactively throughout the buying experience are actually key drivers of your customers’ satisfaction.  Delivering a quality home at the end of the process is almost a given, a ticket to entry. Delivering a worry-free, enjoyable and predictable experience is the way to turn an “OK” homebuying experience into a “WOW” experience. You can’t simply will yourself to improve the customer experience by fixing mistakes, over and over. Look for the root causes of problems, and you’ll usually discover that poorly designed (or executed) processes are the culprits.

Your customers are not an interruption of your work. They are the purpose of it. Focus on the processes by which you manage those relationships and your customers are certain to appreciate the difference, and the “quality experience” you make possible.

Digital Experiences Help Builders Generate Reviews and Sell More Homes

As Millennial buyers take on a larger share of the already competitive home market, builders need ways to better communicate with digital natives about the value of their homes.

With Millennials now representing 50 percent of the home buyers, according to Zillow, builders must go beyond a basic website with photos to communicate with people who’ve grown up in the Internet age and rely on user reviews to make many buying decisions.

“The millennial shopper is used to customer reviews, they don’t buy a pizza or order a movie without looking at reviews, why would they buy a home or renovate their home without studying what other buyers think?” said Paul Cardis, CEO and founder of Avid Ratings.

Founded in 1992, Avid Ratings is a full-service customer loyalty management firm, providing customer loyalty research, organizational consulting, employee training and marketing solutions for more than 2,300 homebuilders throughout the United States and Canada.

A 2014 New Home Conversion Report by Bokka Group and NAHB Research Center found that 80.9 percent of homebuyers surveyed find the reviews and testimonials of other buyers to be of paramount importance when researching different builders. Additionally, Nielsen’s Global Trust in Advertising Survey indicates that aside from recommendations made from personal acquaintances and relationships, consumer opinions posted online have the most influence on purchasing decisions. As such, the impact of online customer reviews may now both rival and surpass television advertisements, branded websites, print ads, and other important marketing channels.

In an exclusive interview, Cardis talked with ProudGreenHome.com about the importance of a digital customer experience for builders, and some of the tools available to builders to elevate their online and mobile presence.

PGH: What is Avid Ratings’ role in the building industry?

PC: We help the industry harness the power of reviews and getting the authentic customer feedback as part of the buying process.

Certainly buyers can go to sites like Yelp for reviews, but what we do is much deeper than that. Yelp is an overall rating. We actually get into the building products and materials that are being used, the trade base, as well as the staff of the homebuilder.

What we do at Avid is analyze all those different layers and provide that level of detail, not just for the industry but also to consumers. Our focus for the past 25 years has been to help builders understand that they may or may not have a good painter or maybe they’re not using the best quality fixtures in their plumbing line and maybe they need to upgrade for their buyers.  Now we’re opening up our data to consumers so they can understand the quality of a builder, understand the quality of materials that go into a home.

The bottom line is, people buy homes because they’re in the right location, they buy them because they’re priced right, and they buy them because they look pretty. What buyers don’t understand is what are homes made of, what are the materials that go inside the walls.

PGH: Why are online reviews becoming a bigger part of a builder’s reputation?

PC: Home building is a complicated purchase; it’s not like going to a restaurant that’s an hour or two hour experience. Home building is a process that involves multiple departments and trades and materials, and last six to 12 months or more.

We’re giving buyers tools, such as our GoTour product, to be able to explore what a house is made of. Buyers have shown they care about the behind-the-wall stuff in a home. The problem is we’re not giving them an easy way for them to see behind the walls. With GoTour they can walk into a model and hold their cell phone up and be able to scan a tag and see what kind of insulation or plumbing is in the wall or any other features the builder wants them to understand.

Our goal is to make it a digital experience so it will be very easy to peel back the layers.

PGH: How can builders offer a full digital experience for their customers?

PC: Digital doesn’t mean just having a website anymore or a picture on a website. To be truly digital and engage on all facets of the digital, you have to have pictures of your products on line, you have to have options for that product on line, with product details so people can dig deep, and finally they need to have customer reviews. Only when you have all three of those do you truly have a digital experience.

Our product line ranges from GoSurvey where we cultivate reviews for builders as well as manufacturers for insulation, windows and plumbing and different components, and also give digital tools for buyers to discover these things. Then we have our GoSocial and our GoTour product lines, which essentially promote those products with their reviews.

PGH: Is the marketplace responding to a deeper digital buying journey?

PC: The leading builders today are seeing an average 20 percent increase in home sales and they’re seeing an average increase in option sales of 11 percent. So the numbers are very palpable and so if you do it, you’ll get the return on investment, and those who don’t do it are getting left behind.

You can view the full original article at Proud Green Homes.

Sales Doesn’t Equal Service

Posted in Author Q & A, by Meg White on February 8, 2017

At the International Builders’ Show in Orlando, Fla. last month, I had the chance to sit down with two authors who know a ton about generating customer loyalty. One was Jason Forrest, a sales trainer and coach whom I’ve known as a regular contributor to REALTOR® Magazine over the years. He introduced me to Paul Cardis, founder of Avid Ratings, a reputation management and customer service firm for the homebuilding industry. The two co-authored a new book, Service Certainty: The Secret to Customer Loyalty (MJS Press; Dec. 15th, 2016). Here’s an edited transcript of the interview.

Tell me how the idea for this book came about.

Jason: The idea came about just like any book comes from the need to solve a problem. My primary focus was on the sales side and helping homebuilders increase their sales. The problem was, we found that by increasing their sales, their customer satisfaction will go down.

Huh, really? I guess that makes sense, though it’s certainly an unintended consequence!

Jason: Yeah, definitely. I started formulating these ideas about why this might be happening, but I didn’t actually know if they were evidence-based. So since Paul is the industry expert and the wizard behind the curtain when it comes to the research, I really wanted to work with him on this problem. I would basically run my ideas by him and say, “Hey, this is what I believe will improve customer satisfaction. Do you believe this would work too?” We worked through that and then ended up coming up with 15 best practices to make it happen and increase customer satisfaction, service certainty, and customer loyalty.

Paul: Avid’s been working with builders for 25 years measuring customer satisfaction and customer experience, and Jason here has been an amazing leader in helping our clients to change their cultures improve so it was really just a natural fit to put these two worlds together and come away with a more practical book. With more than 30,000 books on customer service out there today, we were going into very red ocean. But one point that we both agreed upon was that making customers happy in an imperfect world hadn’t been written about. And in our business in real estate and homebuilding, let’s face it: We deal with a lot of imperfections in the process, and there really wasn’t a book that was realistic. Jason and I put something together here that I think does that.

Yeah, a lot of the books I’ve read talk about how to improve customer service in a perfect world. But they often lack best practices for real-life situations.

Jason: That’s what is so great about the book. So I’m a sales guy, and the normal trend is salespeople don’t like service. Like, if you’re really great at sales you think, “I want to sell you something and move on to the next guy.” So I had to learn how to convince myself first before I could convince anyone else. What’s great about this book—and this is why it’s so small that you can read it in an hour and a half or less—is that we wrote it in a way that it’s the minimum effective dose. Think of it this way: Water boils at 212 degrees Fahrenheit and if you increase the temperature to 213, 214, or 216, it’s still boiling. So you’re wasting energy doing that. We decided to make the book super simple so it’s applicable even to the person who says, “I really don’t like customer service. I don’t want to mess with it.”

What’s a way where sales-focused folks are getting service wrong?

Paul: One of the common problems we see is people who think the solution is, “Well we’ll just go and tell our customers to give us good reviews.” They try and game the system, and they get frustrated in the gaming. That mindset is also evident when you’re thinking “Buyers are liars.” You get mad at the buyer because they’re not happy, as if they came out of the womb that way. Well no, we created them. Of course, there are some buyers—a very, very small percentage—that are just difficult people. But in general we create these difficult customers, so getting your mind right is really an awesome thing and without having your mind right, you can’t move on.

Jason: Yes. It’s also important to think about the service journey. As soon as a customer signs a contract with you, that’s the highest level of emotional engagement they’re going to have with you. Think of it like getting married. The second a person gets engaged, they’re basically saying, “O.K., that’s it. I believe we should be together for the rest of our lives.” Well when you give the girl a ring your goal is to make sure that you provide an experience that’s just as good up to the point of her saying yes to the ring. You know the couple doesn’t need nine months to plan a wedding. They could do this thing in a couple of days, right? It’s a way to put them through purgatory to make sure they don’t do anything to fall short of expectations. It’s called an engagement, but it’s really a test! In the industry, on the day of signing that contract it’s like the engagement ring. You have to get to the move-in day, which is like the wedding day. The customer can easily take the ring off and cancel the wedding any time along the way if you don’t live up to the same promise you did in the dating-to-engagement time as the engagement-to-wedding time.

In gathering the examples you use in this book, did you guys get them from people in the field or did you create hypothetical situations?

Paul: It’s all real stories of actual builders and clients dealing with problems, and a lot of them were pretty interesting too. One particular story that we put in there was one that I affectionately call the “Lemon Man.” We had a customer who dumped 10,000 lemons in their own front yard and let them rot. They wanted to make a statement to the world to say, “Hey, this is a terrible builder and I’m very upset!”

Wow. That’s some serious conflict there.

Jason: Oh yeah. But I think one of the coolest concepts here, which is very provocative, is that a customer sometimes needs conflict in order to generate loyalty. Say a real estate professional takes a buyer out and the buyer is completely in control the entire day. Then buyer thinks they don’t need the help. They’re asking the real estate pro, “Why am I paying you so much money?” That’s why the agent must get into position of strength; they must be in charge. Now I’m not saying you want to actually cause problems, but you do have to create conflict. You have to set clear boundaries and sometimes that creates pushback from the customer. One of the things that we found in the research is that the more the customer is in control, the worse the service scores end up being. Along those same lines, proactively bringing up the conflict and extracting the concerns increases customer loyalty too. If a buyer calls and says, “I have a concern about such-and-such,” and the agent solves the problem then it’s one point to the customer. But let’s say the agent calls the client and says, “Hey I’m curious. Has there been anything that kept you up at night about this purchase you’re about to make?” And the buyer says, “Oh actually yeah…” Well if the agent then solves that problem, that’s one point to the real estate pro. It’s about you bringing it up. You bring it up, you solve it, and you get the credit. If they bring it up and you solve it, you will get no credit.

But that’s scary. I mean, it’s a big thing for an agent to make that phone call and ask if something’s wrong.

Paul: Sure. To be transparent and to own up to problems is a very big deal, because we have all been raised in a perfection mentality. But we are in a different world now, where authenticity matters more. So when things do get screwed up, do we bury them or run away from them? Or do we run at them? That is the key here is that you’re not going to have perfection, and brokers and agents need to embrace that that’s not going to happen.

You can view the original article at The Weekly Book Scan Blog