Homebuilding and Buying: How Millennials are Different

by Paul Cardis

If you’re at a loss when it comes to marketing to millennials, you’re not alone. A quick Google search on the subject yields approximately 26 million results: articles with titles like “8 Modern Tips for Marketing to Millennials,” “How to Market to Millennials: 5 Brands Who Are Doing it Right,” and “The Psychology of Marketing to Millennials.”

Millennials — the roughly 75 million Americans born between 1981 and 1996 — are about to bypass baby boomers as the nation’s largest living adult population. That being said, it comes as no surprise that their buying preferences have significant impact on every industry they touch.

The beer industry is one that has been severely impacted by the purchase habits of millennials, who are creating a mounting crisis for beer industry giants like Coors Light, Budweiser, and Heineken. In fact, beer sales are slipping as millennials diverge from the preferences of preceding generations, choosing wine and spirits over beer. Some key players in the beer industry, to their credit, have started to adapt to millennial preferences, launching new products in an attempt to reverse declining sales.  

Another industry being shaken up by millennials? You guessed it — the home buying and homebuilding industry. Millennials are different buyers than the generations that came before them. A few key buying habits define them:

  1. They’re very cautious and they want to be informed. Millennials grew up during the great recession. Some saw their parents struggle to pay their mortgage, or even lose their home. On top of that, many millennials carry a ton of student debt. As a result, they won’t make homebuilding decisions lightly, and they’ll seek out as much information as possible prior to making a decision. Homebuilders that can provide comprehensive information and be readily accessible to answer questions will thrive in a millennial-dominated market.  

  2. They’re quick studies, thanks in part to technology, but they’re also uneasy buyers. Millennials have access to millions of online resources, and they may be more educated first-time home buyers than the generations who came before them. However, an abundance of resources doesn’t necessarily alleviate anxiety. Industry surveys have shown that a whopping 87% of millennial homebuyers still feel uneasy about the homebuying process. Again, homebuilders that are upfront and transparent, and can provide information and resources that will allay millennials’ nerves will come out on top.   

  3. They’re highly attuned to homebuilding trends around the world. Through the magic of the internet, millennials are in the know when it comes to the latest homebuilding trends, and will expect homebuilders to execute on their vision. Homebuilders that stay on top of industry trends and remain carefully attuned to their millennials clients’ needs will thrive.

Another important thing to keep in mind is tech-savvy millennials’ reliance on online reviews. Buyers — especially cautious, information-seekers like millennials — want to know how the homebuilders are reviewed and rated by other buyers. Honest, peer recommendations are of the utmost importance.

So, as millennials become an increasingly important part of the homebuilding industry, I encourage you to take a proactive approach to meeting their needs — needs which are different than those of the first-time homebuyers who have come before them. Your business will be better off because of it.  And as I always say, millennials won’t buy a pizza without a star rating – why would they make the most important purchase of their life – buying a home – without a star rating.

Transparency: What Clients & Customers are Looking For

by Paul Cardis

Giving customers what they want is the name of the game when it comes to running a business, no matter what type of product or service you provide. And one thing we can be certain customers want is transparency. According to Label Insight, 94% of consumers are likely to be loyal to a brand that offers complete transparency. In other words, if your company’s policies and products come off as anything approaching opaque, you’re fighting a losing battle. Without easy access to the information they crave, homebuyers will look elsewhere.  

So, the question remains: how can you differentiate your brand by offering a level of transparency that sets you apart? For starters, homeowners want more detailed information regarding the makeup of their home. They want to know:

  1. Where the materials originated
  2. How the materials were made
  3. Whether the materials are environmentally friendly

Most importantly, however, buyers want to know how the homebuilders are reviewed and rated by other buyers. Companies spend a significant amount of money on advertising but often underestimate the power of online reviews. Pretty pictures and virtual home tours can only go so far — eventually, customers want honest peer recommendations.

So, in the spirit of transparency, I encourage you to be proactive and share with homebuyers both the good and the bad, giving them a full representation of your company. You’ll be surprised by the effect transparency has on your business.

Not convinced? We can all learn a lesson from Facebook’s biggest PR crisis to date, when a number of shady, opaque policies led to the manipulation of pre-election public opinion. In the aftermath, Facebook has promised to start taking transparency seriously. More on that here.

The Skilled Worker Shortage

Out of the many homebuilders our team works with, the vast majority call worker shortage their top problem when it comes to delivering projects on budget and on time. As we see the market recover, the greatest problem we face is the trade shortage. Simply put, those who worked in the market prior to the downturn have not come back. Furthermore, millennials are not stepping in to take jobs in trade industries, such as construction, which is adding to the shortage.

The experts at MarketWatch put together a very informative article that highlights this problem and provides a national focus on the issue along with ways we can fix the labor shortage going forward. In the end, nobody really knows what we are going to do as we have over 150 million young kids entering the housing market with a shortage of housing for them sure to follow. Builders may be able to fill the void, but not if we don’t have the trade base to execute the work.

We are grateful to MarketWatch for including Avid Ratings in the story. Read the full article here.

Happy reading,

Paul

 

Millennials Continue to Expect More Virtual Experiences

by Paul Cardis

It’s a common misconception that millennials have little interest in homeownership when quite the opposite is true. In fact, according to new data, 80% of millennials would like to buy their own homes but are barred by economic factors that delay the buying process. However, as more millennials saturate the market, they are also expecting to leverage the most advanced technology when making purchasing decisions.  This includes ease of access technology such as virtual reality (VR) for touring homes.

VR technology has been positively trending for the last few years as it becomes less expensive and more available to those not in tech industries. The housing industry is a good example of this. Homebuilders have already begun to embrace VR technology as a way to enhance the customer experience and jump start the buying process.  With almost 95% of homebuyers using the Internet to look for homes and 51% purchasing homes they have found using the Internet, it makes sense that VR technology, a highly digital medium, is incorporated as well.

Millennials are eager and accustomed to immersive and interactive marketing. What are you doing to keep up with one of the fastest growing real estate constituencies?

Read more about VR technology and the housing industry here.

Facebook, Google and LinkedIn: Their Impact on the Housing Industry

As social media becomes more prevalent and accessible in our everyday communication, it’s inevitable that social media giants like Google, Facebook and LinkedIn start to seep into a variety of different industries, including housing. The question is whether this will have a positive or negative impact on the market and how we can combat their impact to make sure our clients remain successful for years to come.

Recently, Business Insider published a feature highlighting Google’s plans to build a 3.6 million-square foot, 3-neighborhood development in Mountain View, California, a small tech-focused community near San Francisco. They hope to help alleviate the affordable housing crisis in that area, as 20% of the homes will be priced below market rate. 

On the same note, Facebook has announced plans to begin construction of a village that would feature not only housing, but retail, grocery, a hotel and more.  The social media giant purchased 59 acres of land in Menlo Park, California in 2015, and it was recently confirmed that this location is where the new community will be built. Once complete, the community will accommodate approximately 35,000 people.

Another social media giant, LinkedIn, has also begun dabbling in the housing market. In December, they gave $10 million to a program that works toward building affordable housing in the Silicon Valley. The project allows housing developers to access short-term loans that help them complete housing projects faster and more efficiently.

While we don’t know how large their reach in the housing industry will expand or if there will be a direct impact for our clients, it’s important to keep an eye on the housing projects being funded by these social media giants. To read more about the communities and projects, read the full Business Insider article.

All the best,
Paul

 

Homebuyer Expectations in the Digital Landscape

Paul Cardis - Avid Ratings

More of our client’s customers rely on finding data, reviews, research and products in the digital space. As homebuyers continue to spend more time on their mobile devices, many companies in our industry are marketing their homes in the same traditional way. Avid understands the need for builders to provide customers with interactive experiences in the constantly evolving digital landscape, and we work hard to do just that with the products and services we offer.

Our team recently attended the 2017 TecHome Builder Summit where we were invited to demonstrate the need for builders to provide their customers with a digital experience. The reality is that customers just aren’t buying homes the same way that they used to. Buyers want to be able to purchase homes the same way they purchase everything else: in the digital world.

Learn more about how we’re trying to help our clients embrace the digital age in this great feature article from TecHome Builder. Read the article here.

 All the best,

 Paul

What the Latest News on TripAdvisor Means For Our Industry

Paul Cardis - Avid Ratings

Ask yourself how often a customer review or product star rating has influenced your purchasing decision. Many of us have come to trust and rely on customer online reviews as it offers peace of mind – especially when it’s something that we haven’t purchased before.  If a business removes negative reviews or falsifies the information shared by a consumer, the impact can be far greater than simply a loss of business or a wavered purchasing decision.  In an article published about TripAdvisor, a popular online travel resource, we’ve learned that reviews posted by travelers on the site were removed by the company, and the reviews could have kept travelers out of harm’s way.

The TripAdvisor news is a wake-up call for all companies who are not aware of the Consumer Review Fairness Act. The federal law protects consumers’ ability to share their honest opinions about a business’s products or services and prohibits companies from suppressing negative consumer reviews. For many, this seems obvious but TripAdvisor was regularly allowing clients to suppress negative feedback from consumers on the TripAdvisor website, jeopardizing the safety of travelers to certain areas in Mexico. This is wrong on many fronts and TripAdvisor should be held accountable for allowing this to happen.

In this case, the lesson for the homebuilding industry is that review washing is illegal. The Consumer Review Fairness Act is a federal law being prosecuted by the Federal Trade Commission (FTC). Furthermore, if you are using a survey system that simply makes it “easy” for you to suppress your negative reviews from appearing online, you need to stop engaging in that practice and likely switch providers. Your current survey company could be the next TripAdvisor and with it your surveys could cease to show up at all online.  We know consumers depend upon verified customer reviews, and without them, your company could suffer significant damage.  Worse yet, you could become the poster child for the FTC on review washing and that would be bad for the entire industry.

There is no easy quick fix to bad reviews and if someone is selling you that option, buyer beware. There are safe and legal options to manage your reviews that are fully compliant with federal laws. Seek a provider who understands this and can keep you in safe harbor.

 All the best,

 Paul

Voting Is Now Open for the Industry Choice – Best Digital Home Tour

GoTour Industry Choice - Best Digital Home Tour

Avid Friends,

In September we announced that Avid is once again a premier sponsor for The Nationals Sales and Marketing Awards at the 2018 International Builders’ Show in Orlando, Florida. Our goal with The Nationals is to help the homebuilding industry recognize leading technologies that deliver amazing customer experiences for homebuyers.

Voting is now open for the Industry Choice – Best Digital Home Tour. From now through November 15th navigate to www.votewithavid.com to vote for your favorite digital home tour. Digital home tour submissions will be judged on overall integration of user experience, aesthetics, and design of the home, as well as the level of metadata available.

The winner will be announced and presented with their award at The Nationals 2018 on January 9th in Orlando, Florida.

Good luck to all participants!

We invite you to vote for your favorite digital home tour at votewithavid.com.

All the best,
Paul

It’s Avid Awards Time

Each year at Avid, we take time to recognize the homebuilders who are creating the very best customer experiences across North America, and we are excited to announce that the 2017 Avid Awards presentation will be aired via web broadcast on July 17.

This year the program includes a few changes. In addition to Production and Small Volume, there is now a Custom Builder category to acknowledge those specializing in higher-end custom homes. Also, the Avid Service Awards will be hosted separately in January 2018 during the International Builders’ Show in Orlando. This is a prime opportunity for Avid to celebrate outstanding employees throughout the industry and we are really looking forward to it.

In addition to the awards themselves, we are also focusing more intently on best practices this year, as will be seen in the roundtable discussions and client interviews during the broadcast. The show came together great, as our marketing team The Digital Ring and Backflip did a bang-up job creating an awesome Avid Awards desk as part of the set… here are some pictures…

 

The Trade Shortage Dilemma

In this installment of Avid Today, we focus on the trade shortage dilemma facing the entire industry. Rather than bemoan a difficult reality, we are sharing innovative and inspirational stories to show how homebuilding can become more efficient without sacrificing quality and customer satisfaction.
First we hear from Mark Hodges, who oversaw one of the most ambitious projects in our industry, building an entire production home in just 6 days!!! We were very fortunate to observe this project and are grateful to have Mark himself sharing the story… enjoy.
We also have a video of one of the first bricklaying robots developed for the homebuilding industry. This is without question a glimpse into our future and frankly, these advancements are happening much faster than most of us realize. This video is a must see.

See SAM in action:

Interview with Scott Peters, President & Co-Fonuder, Construction Robotics:

All the best,
Paul