Laying the Foundation for a Customer-Obsessed Home Builder

Three years ago we bought and moved into our gorgeous home, after years of weekend inspections, painful loan approvals and heart-breaking lost auctions.  But what many don’t know is we were one signature away from a knock-down re-build project that would have seen our dream home built in our dream location.  That’s right – we’d paid the deposit, chosen and customised our house design, even picked out every colour of brick, tile and floorboard.  But at the moment of final signing, we walked away – even though it meant losing a significant deposit.  Why?  We didn’t trust them any more!  A combination of a questionable sales rep, floor plans that differed from what we’d agreed, and a frustrating consultation process meant we’d lost all trust in the company we’d chosen and their ability to meet our expectations.

Which made me wonder – how many other residential home build contracts have been lost due to a poor customer experience during the buying process?

Home ownership has long been considered the quintessential Australian dream, providing financial and emotional security, and often representing the largest investment an individual will make.  It comes as no surprise that Australia’s economy boasts the longest recession-free run thanks largely to a record home-building boom, contributing $44 Billion, 43,630 businesses and 69,850 jobs to the national economy annually.

However, industry analysts are now predicting the house construction boom that peaked at just over 230,000 dwelling starts each year will decline to around 160,000 within three years, representing a 31% slump in residential construction demand.  This steep decline is a direct result of a record construction boom which wiped out housing undersupply nationally, leaving only pockets of shortages in Sydney and Melbourne.  The underlying demand for dwellings, based on population growth and level of household formation, is closer to 184,000 dwellings per annum, putting pressure on home builders to increase their competitiveness in the market if they want to continue to grow or maintain current level of demand.

Adding to the challenge is an aging Australian workforce that is unable to keep up with the physical demands of onsite jobs in the industry.  Mature tradies are in high demand, but with their age comes exhaustion and other health implications.  Fewer younger workers are interested in careers in the construction sector, creating pressure on the industry to find better ways to attract, train and up-skill workers.  And while technology has developed across all industries and sectors, the home construction industry continues to be reliant largely on manual labour, creating a critical need to efficiently and carefully manage workforce to meet the demands of the business.

This is further complicated by an increase in the frequency and severity of extreme weather events such as heatwaves and storms, particularly in tropical regions, causing significant delays to the construction industry.  Frequent weather events impacting productivity and absenteeism during the warmer months of the year can have detrimental impacts to work schedules and customer expectations.  While automation, robotics, employee monitoring and wearable technologies all have a role to play to ensure safety of workers, there is an increased focus on optimising work schedules to be responsive to changing weather events, and carefully managing communications and expectations of customers around these events.

People are more connected than ever before – as a result, customers expect your business to be just as smart, always-on, and as connected as they are.  Customers expect everyone in your business to know who they are, what they need, and deliver that service in a personalised way when it’s convenient to them.  In reality, most home builders lack the capabilities to deliver the personalised, connected experience that their customers want – from initial enquiry all the way through to contract, construction and warranty. 

Unlike the broader construction industry, residential construction is particularly sensitive to shifts in customer expectation – there is a critical need to establish trust early, and deliver on expectations throughout the entire home building process to generate more referrals.  For home builders looking to attract the next generation of buyers who are even more digitally savvy than those that came before them, the ability to communicate, engage and service via digital channels is a critical requirement to winning new business.  And yet:

  • Initial enquiries are still often treated as independent interactions with relatively unknown entities. Frustrations and lack of information at this stage of the process puts customers at risk of seeking alternative options like established homes or rental properties.
  • By the time an opportunity is qualified, customers have made enquiries elsewhere from people they now know and trust, increasing the level of difficulty in progressing and closing deals. If you haven’t established trust by the time a deal is qualified, expect more competitors and lower chance of success.
  • During contract phase, processes and teams are disconnected, creating increased levels of frustration for both customers and employees alike, delaying contract signing and putting a customer at risk of taking their business elsewhere.
  • Construction often happens independently of sales and service teams, with inefficient processes and minimal self-service increasing overall build costs and increasing likelihood of discrepancies between the final build and customer expectation.
  • Gartner predicts that by 2020 a customer will manage 85% of the relationship with an enterprise without interacting with a human, and yet most warranty periods are serviced using traditional, more costly service models delivering lower levels of customer satisfaction and greatly frustrating digital savvy buyers. In today’s world, customer satisfaction and propensity to refer future customers is related more to how you respond and communicate with claims than it is to the fault itself.

With this customer divide comes opportunity for any home builder willing to put the customer at the centre of their operations, and invest in the technology needed to streamline, optimise and personalise the customer journey.

Enquiry Stage –

Self-service communities hosted by Home Builders connect potential customers with the information they need to start their new home journey, providing the opportunity to capture more leads, and rapidly establish a relationship of trusted advisor, cost-effectively.  Customers are more informed and more confident to progress in their purchase cycle, and employees are more informed with a complete view of questions, concerns and interests for any particular customer as well as a knowledge base of commonly asked questions and proven successful responses.  The business ultimately benefits from developing a stronger pipeline in a variable market.

The ideal scenario is a customer getting all their questions answered- and concerns addressed- by the home builder and their community of customers and contractors in one interactive, collaborate community, preventing them from seriously considering or approaching other home builders for comparison.  At a minimum, setting the benchmark for customer engagement so high that competitors are unlikely to meet it.

Opportunity Stage –

Customer-obsessed home builders win more deals through consistent customer experience, being responsive to customer queries and collaborating across the entire buying process.  Leads naturally progress to opportunities along with a complete profile of the customer and their interactions to date – making it easier for sellers to know their customer, progress and close deals, and deliver a more seamless, personalised experience for the customer.  The business benefits from increased win rates and greater levels of customer satisfaction, and improved visibility into the state of the business.

Contract Stage –

Contract times are significantly reduced using automated workflows, approvals and streamlined business processes.  Employee collaboration is greatly enhanced as sellers, project managers, lawyers and contractors are digitally connected throughout the entire contract cycle.  Customers are kept updated on progress, providing greater levels of confidence and satisfaction during the contract stage, and greatly increasing the likelihood of contract signing.

Construction Stage –

Overall build costs are decreased through the use of partner communities that facilitate enhanced self-service for all parties involved in the construction phase, with automated business processes and approval workflows driving greater efficiencies in resource allocation, project progression and customer communications.  Improved visibility into project progression across the business makes it easier for management to make corrections and resource adjustments in time to maximise business outcomes.

Warranty Stage –

Customer communities provide a more cost-efficient channel to serve customer questions and handle complaints or warranty claims.  Self-service access to information, knowledge articles and the progress of open claims drives greater levels of customer satisfaction and increases the likelihood of future referrals.  Not only does it drive down the cost-to-serve, it frees up time for sellers, service agents and project managers to focus on revenue generating activities.

 

There is no doubt, recent shifts in customer expectation and technological advancements are creating unparalleled change for businesses.  At Salesforce, we’re working with construction companies around the world to successfully capture the next generation of tech savvy buyer and continue to succeed in an ever-changing market.  We’re helping companies put their customer at the centre of everything they do – building trusted relationships early in the sales cycle, personalising and providing consistency across engagements, capturing and nurturing leads through to completion, engaging employees and contractors to collaborate more efficiently and effectively, removing waste from operational processes and reducing cost-to-serve.

We’re helping home builders avoid situations like mine – where every potential buyer gets the information they need to support their decision, the trust they need to proceed, and the home of their dreams.