Surprising Pathways

Shea Homes selects Ownership Guide to boost customer satisfaction

Constellation BuildSERV’s Home Ownership Guide, the 2009 Innovative Housing Technology Award Winner, is used by Shea Homes to enhance home builder-to-home owner communications using content management services, online messaging and warranty management software solutions throughout all phases of the new home construction process to keep new home buyers informed and engaged both during and after construction.

“In essence, instead of delivering the Home Owner’s Manual as a paper 3-ring binder that gets shelved, BuildSERV delivers twelve copies of their Manual electronically during their first two years in their home using BuildSERV’s milestone messaging and web-based Home Ownership Guide”, according to Chip Pennington, Corporate Director of Customer Service, Shea Homes.

“The next generation of home buyers are expecting more information online, and BuildSERV delivers the effective communication tools they’re looking for with a comprehensive, web-based Home Owner Manual, providing quick and easy access to regular updates about their home and enhanced information services to create better home buying experiences,” quoted by Robb Pigg, Corporate VP of Operations, Shea Homes.

View Press Release

New Breed of Builder

  I am looking for an author to post to a new blog describing the “New Breed of Builder”. Bonnie Waude an influential local builder described this phenomena as an important trend that everyone wants to know more about.  As may be aware, one seed for this growth are financial instututions with troubled properties that partner with entrepreneurial people to salvage assets.  This trend is giving rise of new businesses with different orientations in residential construction.  There are probably local and national trends that could be highlighted.

 

    I am the chair of the marketing committee for Career Connections, the educational arm of the King and Snohomish Counties, WA, Master Builder Association(MBA).  We are trying to promote educational programs and career opportunities in residential construction.

 

    Last year the MBA launched a website called: 

http://www.constructionmatch.org/ and we would like to find an author to post an article about this topic there.   This is an important effort for me and our local MBA as we launch some new educational programs.

 

  As you may know, just a few years about we were dealing with major problems finding qualified young workers in the construction trades.  Lack of qualified workers will re-emerge as a big problem in our industry and it has the potential to negatively impact suppliers, particularly those who require skilled workers.

 

  The second question is how do we build traffic to this networking site….and is it possible that we could do a series of articles that could do this in a way that would also cross promote software related businesses.  Are you aware of other websites in regional MBA’s that could benefit from educational programs and networking about this topic?

Warranty activity at an all-time high! Leading indicator for homebuilding recovery?

I keep up with Eric Arnum's well-researched newsletter, Warranty Week, and their recent findings suggest that warranty claims are at an all time high for home building suppiers such as HVAC, appliances, fixtures and building materials.   Not only are claims at their highest rates but the manufacturers are also anticipating higher costs as most manufacturers in his survey increased their accrual rates.  

Eric Arnum observes "But building activity, or at least the repairs and warranty work that results from building activity, is by our measurement at an all-time high. Chalk it up to labor rate increases, commodity inflation, Chinese drywall problems, currency exchange rate chaos, product quality declines, sunspots, hurricanes, or stimulus spending, if you must. But the fact remains that this select group of warranty providers paid out more in claims this spring than they ever have before."

In late September Warranty Week completed a survey of new home builders that will also be of interest as it was here they "suggested that an upturn in the amount of warranty claims paid by new home builders could signal that a bottom had at long last been reached in that sector".

 

Leading edge customer communications services enhance Shea Homes leadership.

Exciting news regarding the J.D. Power – "Overall Customer Satisfaction Report for 2009".  

BuildServ’s Ownership Guide client – Shea Homes competes in 5 of the 24 markets surveyed in the report.   Shea Homes was ranked highest for Overall Customer Satisfaction in 3 of these 5 markets (Phoenix; Denver and San Francisco) and second highest in the other two markets(Inland Empire, Orange County and San Diego).  

Furthermore, Shea Homes accomplished these ratings 3 of the 5 most competitive U.S. homebuilding markets where BuildServ’s leading edge customer communication services have enhanced their leadership position.

 

"Overall customer satisfaction improves for a second consecutive year, averaging 811 on a 1,000-point scale in 2009, and up 32 points from 779 in 2008. Markets with the highest levels of overall satisfaction in 2009 include Orange/San Diego, Calif.; Sacramento, Calif.; Phoenix, Ariz.; Inland Empire, Calif.; and Tampa, Fla.. In addition, overall satisfaction has increased in 22 of the 23 individual markets that were also surveyed in 2008."

 

Please find the details of the report in the link below.  It also appears that there are other Constellation success stories here too.  These successes include Brookfield Homes, Ashton Woods, John Wieland Homes, Town & Country, Classic Homes, Meritage Homes, and others.  Here is information from the press release.

http://www.jdpower.com/corporate/news/releases/pdf/2009172-natl.pdf  

Invest Now or Languish!

"Customer acquisition is an investment, but customer retention (loyalty) delivers profitability".  According to Guy Master, in a recent article in CRM Buyer.   For homebuilders this translates into lower marketing and selling costs, higher sales conversion ratios, and lower warranty costs. With the economy in its current state, it's more important than ever to invest in technology that helps improve the home-buyer's experience. 

However we are seeing just the opposite response.  Home builders are reducing technology investments and budgets in keeping with reductions in home sales. Although this appears to be a rational response it is the wrong time to cut and the right time to increase investment in customer loyalty technologies.  Here is why this may be happening.

A new and dramatically different type of consumer and new home buyer is emerging.  This home buyer will be much more connected through their social networks and mobile devices.  They will expect homebuilders to be able to deliver information and resources through these networks and devices. 

In the days of fast paced home building sales, most builders were already behind in terms of their investment in customer loyalty technology and services.  Those builders that have invested will have a significant competitive advantage over those who have not invested.  Especially given combined a dramatically different new set of home buyer expectations that will demand better customer service solutions.

Here are some crucial steps from the NAHB Research Centerthat every builder can take to build customer loyalty and strengthen their referral base.   The 10 best practices highlighted below come from the NAHB National Housing Quality Award winners.  New communications technologies will play a crucial role in the successful implementation of these time tested practices.

NAHB Recommendation	Enabling Communication Technology
Educating buyers about the home construction process and inviting them to be involved in the building of their home.	Well designed web-based plans and option viewing programs.  Construction process education videos and web notifications.
Floor plan layouts that demonstrate insight into making the home an inviting place to live.	Provide computer modeling and 3D renderings of floor plans.
Thoughtful human factor designs that anticipate needs such as placement of light switches, electrical outlets, and hose bibs.
Keeping buyers informed of construction schedules and progress without being asked first.	Send updates to note important milestones with relevant educational information.
Having the home ready for closing BEFORE the scheduled closing date.	Communicate punch list items to project team immediately in real-time.
Pre-final punch-outs so complete that the customer finds zero defects at final inspection – but you find a few minor items.	Track and manage reporting data to benchmark performance at final inspection.
All final punch list items are completed before closing.	Send certificate of occupancy to buyers electronically with status report.
A week after move-in, call to schedule visit to take care of any problems found.	Send and receive appointment and scheduling confirmations.
Two weeks after move-in the company President calls to see if there is anything that can be done.	Automatically notify division president(s) when to make contact with new homebuyers along with contact profile.
Willingness to accept warranty responsibilities without being confrontational.	Send homebuyers details about their warranty responsibilities several times prior to closing.
Fast response to callbacks.	Provide online appointment scheduling
Pro-active warranty inspections at six and 11 months that find things that the customer did not see.	Send notification and set-expectation for warranty walk meetings.
A home maintenance inspection/review two or more years after closing.	Send notification of warranty accomplishments and provide opportunity to schedule post-warranty walks.

For more information about potential solutions please visit http://www.constellationhb.com/buildserv-chs.php

Going Green and Insurance Discounts

Insurance companies are finding that green products are associated with lower risk, and are offering significant discounts.  So wouldn’t shouldn’t this be also true for the homebuilding industry? 

This WSJ article highlights an angle that the homebuilding industry could pursue with insurers, particularly with the capabilities of software products that manages and tracks information about “green” profile of a finished home. 

Of course we could call this "sustainable" building practices instead of "green".  From my perspective the value proposition to the insurance industry is more obvious.  The word "green" without the associated certification I am afraid might create confusion and possibly suspicion.

Why blog and share your ideas?

In response to a friends question, why blog or share information with others via the Internet? 

I believe that the iterative power of the Internet can help us shape, evolve and improve our knowledge and capacity to learn.  As a result, traditional methods of logging/journaling your thoughts and sharing them on paper(or by email) are quickly dying.  Social networks make it easier to share and collaborate about important experiences and ideas using words, pictures, links and comments.

Most importantly, in these times of great financial uncertainty, trusting in your business partners becomes extremely important.  One of the first resources prospects will use to evaluate an individual such as a real estate agent or a homebuilder will be an Internet search.  Those whowill be chosen first will be those that have the most professional associations, recommendations, connections,  interesting content, blogs entries, quality lists of associates and "friends".

Here is why I believe it is so important to push yourself to participate now:  Our children are in the middle of the next media revolution that could sweep right past the Baby Boomers, Gen Xs and Ys.  Knowing there is much more on the line for our kids makes it a priority that we utilize this window of opportunity to engage and help them build their networks.  Embracing this change and keeping up with the pack is a much better option versus being relegated to the information dinosaur pile, isolated from rapidly growing networks that are learning and evolving.

The pundits say that the best way to build your social network is to start (for us newbies) with your family connections (as automatic "friends") and then expand to non-family friends.  Eventually this investment in time will yield dividends through experimentation which helps all of us.  Also keep in mind that as you get beyond the initial set-up your learning curve moves up rapidly.  I propose that you try one of the new media like Facebook, Linked-In, or building a blog site sometime in the next several months.

One fear that temporarily held me back was privacy and my fear of who might view my entries on Facebook, Twitter, my blogs and LinkedIn.  This concern surfaced in the last few weeks with proposed changes to Facebook's privacy policy.  However almost all social media sites provide settings that allow users to set preferences to limit which content your "friends" or the "public" can view, which I believe adequately addresses the privacy issue.

For my personal blog I chose to have a paid subscription so that there is no advertising but you can also blog for no cost if you are willing to put up with the advertising.  For professional blogs I would definitely recommend a paid subscription or WordPress which is free program that you download and host. 

Generally the content you contribute is yours, not the host site's.  You may share your ideas and you may withdraw them from view.  However in the Internet world once you share your content publicly you lose a large degree of control.  Always keep this in mind and be very selective as to what information you choose to place in public view.

Here are a few ideas on how to get started (and many of you may already know about these resources):

1. Facebook is a place to exchange and share information with others in a fairly secure space....in that only "friends" can see your pages.  Maybe you already do this.  Sue has really enjoyed it with her friends over the last 6 months.
2. Linked-In is a fabulous place to share your profile with other professionals and join like-minded groups and communities.  The fast growing membership of LinkedIn could be an excellent resource should you be in the job search market. One great feature is giving and recieving professional recommendations from associates in the LinkedIn network.
3. Typepad, Blogger, and others are paid or free blogging services... I am using Typepad for this blog entry and it costs me $45/year.  It takes an hour or two to initially set up and figure out the basics.
4. If you have work e-mail but no personal e-mail address consider Google, Yahoo, Hotmail or AOL.  These services are easy to use and access. Also Google apps give you many other great new applications such as online documents, spreadsheets, photos and much more.  These are all "free" services but they are supported with advertising. 
5. Twitter is a great micro-blogging site that allows you to communicate with others very efficiently.  The reason I like Twitter is that messages cannot be longer than 140 characters so they are easy to read.  Once you have a community of friends it is an excellent way to stay connected in either your profession or personal communications.
6. Delicious, Digg, Newsvine, Technocrati and others are great social bookmarking and commenting site for sharing links and other information you find on the web.  These sites would be more appropriate for advanced users.

I look forward to your comments.

FTC issues new Opinion Letter that helps warrantors using electronic documentation

The Federal Trade Commission in a February 17, 2009 opinion letter provides additional grounding for use of electronic copies of manufacturer's warranties in certain circumstances in lieu of paper copies for disclosure purposes.  This is an important opinion it that it has the potential to save vendors the significant costs associated with providing the many printed versions of warranties stipulated by the Maguson-Moss warranty act.

Here is the conclusion of the opinion letter that summarizes the how and where electronic copies may be used:

"Based on the broad language used in the Pre-Sale Availability Rule, FTC staff’s opinion is that an electronic version of a consumer product warranty would constitute a “copy” of the written warranty for purposes of compliance with the Warranty Act and Rules.

Moreover, it is staff’s opinion that a written consumer product warranty that is included on a CD, DVD, or on the internal drive of the warranted product would qualify as being “provided with” or as “accompanying” the product. In passing the Act, Congress’s intent was to ensure that consumers receive clear and complete information about warranty coverage pre-sale, and that consumers be able to retain a copy of the warranty post-sale for reference in case of product failure.

In the opinion of FTC staff, those purposes are sufficiently accomplished by providing, in electronic form, a copy of a written consumer product warranty that otherwise complies with the requirements and prohibitions of the Warranty Act and Rules – provided the warranted consumer products include clear, conspicuous, and easy-to-follow instructions on how to access the warranty information provided on the consumer product’s internal drive or on an accompanying CD or DVD and that a consumer can print out a paper copy of the warranty if needed.

Further, consumers who receive your client’s warranties electronically may end up dependent on the copy of the warranty available on your client’s website if product failure occurs, because they may not be able to access the internal drive or portable media. Therefore, if your client changes its warranty, it should keep on its website a posting of printable earlier warranties and the dates they were in effect."

Magnuson-Moss Warranty Act and class-action suit against Trex Company

A recent class action claim by consumers and the legal community is targeting a manufacturer and suppliers.  The issue in this case is the inadequate disclosure of the manufacturer's warranty.  The federal trade commission requires that consumer receive copies of manufacturers warranties during the pre-sale and after-sale with the delivery of the home and products.

The recent class action complaint against the Trex Company alledges the failure to properly communicate the manufacturers' limited warranty to the consumer at the point-of-sale.  One aspect of the complaint filed on 1/13/09 against Trex cites "Trex's failure to assure that written warranties be made readily available for examination by prospective buyers violates Magnuson-Moss Warranty Act - 16 C.F.R 702.3.  The Trex Company Inc. has responded to the complaint by acknowledging isolated quality issues but has rejected the basis of the complaint.

This case highlights the importance of taking additional steps to protect your business from warranty disclosure claims.  For example several production oriented builders organize all their manufacturer's warranties and provide to consumer on a CD-ROM. This is provided in the pre-sale process or at their Design Center prior to contract signing.

Smaller and custom home builders may have more difficulty protecting themselves against warranty disclosure claims since they rely on heavily on vendors to deliver the manufacturers' warranty at pre-sale.  Builders should take a careful look at this process to make sure their buyers receive copies of the manufacturer's warranty in the pre-sale and post-sale process.  

Also see a new post to this blog regarding a new interpretation by the FTC regarding the acceptability of electronic formats of warranties in lieu of paper copies.

Home Care Tips for a Sustainable Future

Strenghtening Customer Relationships

Homebuilders, designers and developers are much more focused today on sustainable products.  In addition to the products themselves consumers are demanding sustainable practices for the maintenance of products, materials and systems in their home. 

A private label newsletter service provider such as the Ownership Guide helps you communicate information to build loyalty and strengthen relationships.  Consumers learn how save money and feel better using sustainable water management, disposal, recycling practices, along with minimizing their output of gases thought to cause climate change. 

http://www.buildserv.com/resources_e-newsletter.asp