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.
/ Gary Wollenhaupt is an experienced writer and editor, with a background as a daily newspaper reporter as well as corporate and agency public relations and marketing. He is constantly looking for affordable green upgrades to make to his home in eastern Kentucky.