The Demand Solutions Blog

A headline about consumer preferences caught my eye recently. It was from the recent annual meeting of the Urban Land Institute (ULI) in Boston, and it read: "Walkability Now May Outweigh Transit Access in Valuing Location."  

As we head into the Labor Day weekend residents will be heading out of town to visit family, welcoming visitors into town, or heading out to picnics and “firing up the grill.” Can you believe it, the unofficial end of summer is here? Next week we’ll all be “back to the grind.”

An event coming a week later has some of us at D2 Demand excited (but not Donald…he’s a PC/Android guy). On September 12th, Apple will be hosting their annual event to announce their new iPhones, and Apple Watches, oh yeah, and one more thing. This got us thinking about how multifamily operators can use technology to make residents (and prospects) happier.

Over the past couple of years, our company has conducted unit amenity audits for many different operators. The good news is that the concept of identifying unique attributes of each unit and attempting to realize the value of those attributes through variable pricing is a well-established practice in multi-family housing.

The not-so-good news is that we rarely see examples of highly proficient amenity setups. So, at the risk of giving away a little of our secret sauce, here are several of the most common mistakes and/or missed opportunities we’ve seen:

Last week, I had the pleasure of attending the Apartment Internet Marketing (AIM) conference. Aside from the great location in Huntington Beach (I don’t normally pay much attention to conference locations, but I’ve really come to love that particular one), the content this year was spectacular. It’s sometimes an industry sport to complain about conference content, so Steve Lefkovits and Dennis Cogbill deserve a special shout out for curating a truly great conference.

The conference covered such a wide canvas of topics that I thought I’d replace my normal detailed review of 3-5 key themes from any conference for a quick tour of all the things that struck me. Here goes:

A week or so ago, I blogged on my daughter’s reaction to a study allegedly sharing insights into how you need market to millennials differently than everyone else. I got so many responses to the raw honesty and insight, I thought I’d go back to the D2 Demand Solutions Millennial Focus Group (again, really just my 23-year old daughter who is a renter) and ask her what she thought about the buzz around micro units and co-living concepts.

The good news is that, unprompted, she’s heard plenty about both of these. The not-so-good news? Just read her response:

Literally every millennial I have seen comment on them thinks they are glorified college dorms, and no one wants to live in them over a normal apartment. People just have to in places like San Fran because rent prices are ridiculous. There is a lot of grumbling about how baby boomers screwed over the housing market and now they think we want to live in dorms forever. Seriously, no one wants a communal bathroom and kitchen.

Today, customers want an experience, not just a transaction. In fact, they expect it. They get it in their interactions with many other companies, e.g., Amazon, Uber or Lyft, Nordstrom, etc., so they expect it from you. Design and innovation company, Fjord Accenture refers to this new world where customer’s drive expectations for one business based on what they experience with others as “liquid expectations.”

If you ask virtually any multifamily employee or executive, they’ll tell you they care about the customer, want to provide rewarding customer experience and value customer satisfaction. Despite the lip service paid to customer experience, in our interviews with associates and residents, we still see many missteps in how multifamily operators are pursuing these aims.

For years, this was not a significant business issue. As the real estate ethos states, if you paid attention to location, location and location, and added a focus on managing costs you’d be profitable. Besides, your competitors weren’t providing a much better experience, so it was easy to think it made little difference. Today the tide is shifting and if your company does not pay attention you will miss out. Here are the most common and vital mistakes we see operators make when focusing on the customer experience.

Open up any business publication and it’s a pretty good bet you’ll see something that talks about customer service or the customer experience. In the multifamily industry, the focus by nature is on our customer - the resident. 

However, one problem with much of what’s written on the topic is that customer service and customer experience is often used interchangeably. To drive the type of results you want from your initiatives, you must understand the difference between service and experience, and the continuum of customer experience.

Customer service is about process. It's a lot of the standards and internal processes. It's the basics that we have defined for our teams: the stand, smile and greet, the way that we engage with a customer when we meet them, when they come in the office, when we pick up the phone and so on.

Customer experience, on the other hand, is a journey that companies go on as they start to evolve from providing service, that’s focused on our processes, to truly focusing on the customer and crafting an experience designed for them: and equipping our teams with the necessary processes and products to deliver that experience purposefully.

Customer service is about standards, processes and techniques. Customer experience is how everything comes together to create an experience for the customer, and it’s how that experience feels to the customer.

As you design your intentional customer experience, it’s important to understand there are, in essence, four levels of experience:

Companies spend a lot of time, effort and energy introducing new initiatives into the organization (often referred to as a rollout), some with more frequency than others. Before starting a ‘rollout’ it’s very important to remember that what you’re doing is introducing a change. And, more importantly it’s important to realize that change is not easy to introduce (or sustain), and it certainly doesn’t happen on its own. 

Have you ever participated in a conversation with other leaders where the topic of conversation is focused on frustration about a new initiative that the teams are not embracing? Often the solution for that problem is a request for more training since the belief is that the teams didn’t ‘get it’ the first time. However, if you dig deeper you will probably discover that the root cause of the problem isn’t that the teams didn’t understand the training, the reality is that the initiative wasn’t introduced with an intentional change management approach. As a result, the teams (for one reason or another) are still doing things the old way. 

With all the attention on the recent series of airline service mishaps, we thought it would be a good idea to talk a bit about the difference between “customer service” and “customer experience.”

Harvard Business Review defines customer experience as “the sum of all interactions a customer has with a company.” This covers everything from when someone becomes initially aware of a company, through their purchase process, use of the product and re-purchase experience. The Disney Institute refers to “the critical moments—what we call touchpoints [their emphasis]—that create an organization’s overall customer experience.” It reminds me of Jan Carlzon’s seminal book Moments of Truth in which he defined his airline (SAS in the 1980s) not as a collection of airplanes, gates and routes, but rather as the sum of all of what he called “moments of truth” (hence the book title). These are the individual interactions between company associates and customers. In the digital age, we would add interactions through technology (for airlines, think of the online booking engine, airport check-in kiosks, auto-notification of delays and gates changes, etc.). As personal aside, this has always been a passion as I wrote my master’s thesis as a case study of the cultural change Carlzon led at SAS in the 1980s.