What’s your brand backstory?

The accelerating nature of technology and media convergence will have a resultant entropic effect relating to the perception of “brand” within and outside an organization. This premise will underpin several forthcoming blog posts. This blog post will discuss how this entropic effect affects brand storytelling.

Craft your backstory

For easily a decade 1000Watt Consulting and Matthew Ferrara & Company have been challenging real estate organizations to define and embrace their unique stories. From executive tier discussions centering on core values and culture, previous and present technology choices, to operational issues, they have helped elevate their clients and the real estate industry at large in immeasurable ways. A decade of listening to these auteurs—accompanied at times with the privilege of sharing a dais here and there with them—has been particularly instructive around the concept of “brand.”

However, it was not until recently listening to Marc Davison (of 1000Watt) and Matthew Ferrara on two separate occasions that I fully realized some of the foundational constructs underlying a “brand,” particularly its “story.” Both occassions (at the Wothshop 5 and Leading Real Estate Companies of the World conferences) focused on the core elements of storytelling and brand narratives. In particular, Davison elucidated the power of the backstory of a brand in his unveiling of the new Harry Norman Realtors web and mobile presence (soon to launch publicly). What I took away from his presentation is that the backstory of a brand functions as an anchoring element and values-driven catalyst to all facets of a brand’s expression—internally (privately) and externally (publicly). It’s the backstory of a brand that is one of the most critical components of ensuring brand consistency across the new media convergent universe.

Media convergence theory posits that:

[C]hanges in communications and information technologies reshape and change everyday life, altering patterns of creation, consumption, learning, and interpersonal interaction. New technology redefines media content and alters human interaction with social institutions such as government, education, and commerce. citation

Implicit within this definition is the concept of entropy. And as the impacts of media convergence continue to manifest (e.g., more time spent on media and devices than there is in a 24-hour day ) the potential for attenuated, particlized, and repulsive effects on brand messaging increases. Without some tethering or unifying aether, brand continuity will decrease, brand consistency will atrophy, and consumer trust of your brand will wither.

So what is this unifying aether? The backstory of your brand.

A useful definition of backstory is:

[A] history or background created for a fictional character in a motion picture or television program…similar background information about a real person or thing that promotes fuller understanding of it. citation

The latter half of this definition is the salient element for branding considerations. This element was poignantly made clear by Davison as he discussed the brand-level archetypes and triptych-like features of the new Harry Norman branding with the audience at the 2016 Leading Real Estate Companies of the World conference. While touring a branch office, he noticed a portrait of Emmaline Norman, who founded the company in 1939. Inspired, Davison began digging into the historical record and story of the company, unearthing several core values and cultural facets (artifacts?) that implicitly grounded the company from its inception. From these facets, 1000Watt created linguistic and visual narratives that described and framed the company in a new light. This revitalized linguistic and visual symmetry, interacting holistically, created the backstory for a new expression of the Harry Norman brand.

So how does this backstory ameliorate the potential negative or complicating impacts of media convergence? In its purest, elemental nature this backstory is device, medium, and platform agnostic. And this is the crux of the argument. In this elemental form, the backstory remains unaltered and unaffected by accelerating changes in media and technology. The brand backstory operates as a sustainable catalyst for consistency and continuity around your brand.

Photo credit: Very Quiet

Zero Moment of Trust

Ask almost any real estate professional what compels a client to work with them or personally refer them, and that professional will probably say something like “They trust me.” This is also backed up by research from the National Association of Realtors (see Exhibits 4-17 and 7-8, 2013 NAR Profile of Home Buyers and Sellers). But more often than not, this “trust” is predicated upon in-real-life, face-to-face interactions. The challenge, however, for modern real estate practitioners is how to imbue a sense of trust via a mobile or web presence. What is the Zero Moment of Trust for a prospective client to make the decision to contact or divulge personal information to a real estate brand or agent via a mobile or web interface? How does a professional break through the scrim of the screen to convey this sense of trust?

Zero Moment of Trust
Zero Moment of Trust

The Zero Moment of Trust concept builds upon Google’s concepts around Zero Moment of Truth (“ZMOT”). ZMOT describes how a set of search-related activities, from whatever device, informs a consumer at the point of decision regarding a product purchase. In previous years before mobile commerce was so prevalent, this search-influenced and aided decision making timeline could extend to hours and even days. However, within a mobile commerce environment–enhanced and influenced by mobile-enabled search–a consumer’s purchase decision making timeline is near instantaneous.

For example, a decade ago a consumer, sitting in front of a home computer, likely would have browsed through several websites, over several hours, as part of her decision making process. Whereas today that same consumer could be sitting in a cafe enjoying a cortado and decide to purchase a pair of shoes, use Google to conduct a search, sift through relevant search results, find a nearby boutique as well as sift through Zappos results, compare both retail outlets via their online presence and ratings, and decide to purchase via Zappos…all within the time it takes for her to finish her cortado. This latter scenario effectively captures the core concepts embodied in Google’s ZMOT argument. And similar to shopping for shoes, consumers use search to find properties for sale or rent as well as find agents with whom they may want to represent them. But it is at this point that ZMOT breaks down in real estate. For ZMOT is a great construct for how consumers make product purchasing decisions, but it is a weak construct for how clients decide to work with a professional. And it is at this moment that Zero Moment of Trust comes into play.

The client-professional relationship is centered around trust. Thus, there is a second layer of trust-based decision making activities a consumer undertakes in evaluating a professional. Further, much of this evaluation occurs within mobile and web related contexts. And for the real estate professional, whose first interaction with a client is more often than not nowadays bound to these contexts, how trustworthy he or she appears within these contexts often determines whether a prospective client will contact them. Thus, the question becomes how can a real estate professional immediately convey a sense of trust within these contexts? How can a real estate professional leverage Zero Moment of Trust? The answer to this question resides within the realms of user experience (“UX”) and user interface (“UI”) design and how to leverage mobile and web trust indicators.

According to these research reports, How do users evaluate the credibility of websites (.pdf), An overview of online trust: concepts, elements, and implications, and What instills trust? A qualitative study of phishing there are three primary mobile-web trust indicators: performance, design, and information. Performance trust indicators center around platform speed, page load times, and overall functionality. Design trust indicators center around balanced UI, ease of navigation, continuity, consistency of UX across devices, and intuitiveness. Information trust indicators center around simplicity of message, forthrightness (i.e., no trickery), usefulness, and client ratings and testimonials. These trust indicators must all sync as an integrated whole to immediately convey a sense of trust to a prospective client, which will prompt this client to do something (for example, request a showing, contact an agent for a CMA, etc). To help illustrate these concepts, following are visual examples as to how some brands outside of and within real estate are using trust indicators to impute trust to viewers:

airbnb

airbnb

Take-away: Balanced design and ratings directly on the booking page imply trust.

Michael Saunders & Company

Michael Saunders & Company

Take-away: The nexus between elegant design and the nuance of language (e.g., use of “Serene beaches” rather than the location of these beaches to enable a visitor to search these locations).

These brands explicitly or implicitly leverage Zero Moment of Trust principles. I encourage you to browse through the two websites mentioned above (via your desktop/laptop, tablet, and mobile phone), paying particular attention to how they use design and language to convey a sense of trust. These two brands have leveraged several trust indicators to gain and maintain marketshare and win consumer mindshare.

Consumer experiences with retail set consumer expectations in real estate

Before a consumer decides to purchase a home (whether first time buyer, move up buyer, etc) how many times has he or she purchased products via Amazon, Zappos, iTunes, or visited Target or an Apple Store? Hundreds of times. Thousands of times. And in some cases likely tens of thousands of times. Think of the experience these entities deliver, the baseline expectations their consumers bring to the door when they begin their real estate experience.

What are these core baseline expectations? First, consumers expect integration between mobile, web, and social channels. Second, consumers expect stellar and insightful customer service. Third, consumers expect seamless integration between one and two above.

The ability to manage one’s own experience with the brands mentioned above–whether searching for products, skimming product reviews, downloading products, using an immersive mobile shopping experience within a store environment–is a key driver of their ability to consistently delight their customers. Additionally, if a customer service issue arises, these brands’ customers expect insight and knowledge about their interactions with these brands. For example, if I as a consumer reach out to the customer service department of one of these brands I understand I will have to provide some baseline validation as to my identity and explain my customer service issue, but I also do not want to explain my entire history with these brands. The customer service representative has my history at his or her fingertips which gives that representative an opportunity to engage me at a higher level, more efficient level, and more satisfying level. The brands mentioned above consistently deliver on these expectations, which is seen in their stock prices, their loyal customer bases, and general goodwill.

Real estate brands should study how these brands deliver on customer expectations. Additionally, real estate brands should strive to create support structures, systems, and training programs that give their sales associates the best opportunities to delight their clients, the best opportunities to deliver an exceedingly excellent experience. In essence, deliver an Amazon-like, Zappos-like, Target-like, and Apple-like experience. It’s this service delivery differential that drives personal referrals, client loyalty, and goodwill.

Photo credit: Patricia Turo

Responsive web design or native mobile app?

Responsive web design or native app? With limited development budgets, the vagaries and proclivities and peculiarities of iOS and Android development platforms, it’s a valid question. I believe you need both.

Responsive web is your catch-all, your mobile safety net. You can absolutely create a responsive web mobile experience that’s elegant and delivers a great user experience that helps drive consumer engagement. But if you’re concerned about developing loyalty with your customers, you need to consider developing a native mobile app that works synchronously with your responsive web mobile platform.

If a consumer takes the time to download and install a brand’s app, when they can otherwise get a similar experience via that brand’s responsive web environment, that behavior is an early indication that they’re inclined to be a more loyal customer over time. The key in this scenario is to reward these types of customers with a better experience than they would otherwise get via your responsive web platform.

For example, I recently received this GoPro message inviting me to download an app that allows me to wirelessly control my GoPro HD HERO2 (something I cannot do via GoPro.com):

This app gives me a better experience with my HERO2, but also gives GoPro potential opportunities to interact with me at higher levels such as messaging me directly (if I accept to interact in this manner), sending me more targeted offers, inviting me to special events, etc; essentially incenting me to engage with them as a brand. It also gives GoPro a base of loyal consumers that GoPro can leverage to form strategic alliances. For example, GoPro could form an alliance with EpicMix so when I ski at Vail Resorts I receive special co-branded offers from both brands, GoPro sponsored VIP parties at Vail Resorts, etc, thereby increasing my trust and love of both brands. Finally, the GoPro app could keep track of my usage history and send a record of such to GoPro.com so when I login there I feel I am further tied to and invested in the overall GoPro experience.

Photo credit: Howard Dickins

 

Personalized agent recommender systems in real estate

Personalization in product recommender systems in industries outside of real estate will soon impact how consumers choose—or will want to choose—real estate professionals on brokerage sites. The basic concept: How would Amazon.com recommend a real estate professional? To answer this there are two basic sides to consider: customer behavior within a system (and increasingly outside of the system; see what RETargeter is doing) and attributes and behavior of the real estate professional.

At a very basic level, recommender systems track and log consumer behavior and then match appropriate products and services based on this behavior. The key is that these products and services have particular attributes that “match” the behavior of the consumer. For example, assume Consumer A purchased five historical novels over the past five months, a recommender system likely would recommend another historical novel as a next purchase. So how could this impact real estate professionals?

First, assume a brokerage has a system that logs consumer behavior (login times, locations searched, favorite properties, map searches generated, etc). Second, assume a brokerage has segmented its agent base by basic factors (such as top neighborhoods serviced by the agents, top 10 zip codes serviced by the agents, lifestyle attributes, designation, luxury expert, waterfront expert, client service satisfaction ratings, MLS performance, etc). Next, the real estate professional recommender system could work similarly as to how a book recommender system works. And I know that some listing aggregators already offer this type of service, but these services on generally pay-to-play. What I am suggesting is that brokerages need to do something similar with their system and offer it free-of-charge to their agents.

For example, lets assume Consumer B registers and saves a luxury property overlooking a lake, the system could automatically “recommend” agents who work the zip code of luxury property AND are luxury agents AND are waterfront specialists. Next, let’s assume Consumer B clicks the profiles of each of the recommended agents, he or she will then see overall performance ratings, specific testimonials, and specific customer satisfaction ratings. The benefit to the consumer is that they’re presented with the “best” professional based on their interest, which supports customers-for-life marketing best practices. The benefit to the real estate professional is that they’re in front of the consumer faster and in context to the search process. This type of a process promotes a personalized experience which is key factor in capturing consumer mindshare. And, indeed, there is research that supports this proposition.

Social CRM eLoyalty Context-Aware CRM

Below are three excellent research articles on social CRM and related topics.

This research paper (out of Australia) delves into the nexus between mobile consumerism and eLoyalty programs. A key finding is that companies can increase consumer loyalty by leveraging mobile devices (via apps, I posit) to highly personalize a consumer’s brand experience while facilitating a highly responsive and insightful customer service environment to answer questions, resolve complaints, etc.

Here’s a great nuts-and-bolts presentation by Gartner on fundamental CRM concepts. The presentation includes a vendor analysis and recommendations on implementation. But the feature I liked the best is the discussion on context-aware CRM.

This report is an excellent analysis of social CRM concepts, including an informative discussion of the risks associated with undertaking a corporate-wide social CRM initiative.

 

 

Value based CRM aligning marketing IT and finance functions

This article discusses values-based CRM concepts in regards to aligning marketing, IT, and financial functions. An interesting point made by the authors

[F]ocusing just on the ability of IT to support strategy and processes bears the risk of not utilizing the full potential of innovative technologies[.]

It’s clear there is a critical interdependence between both marketing and IT departments. As marketing seeks to “engage,” “relate with,” and “delight” customers in the continuous battle for share-of-mind and share-of-heart, relegating IT to the sidelines as bench support is not a good strategy. Rather, incorporating IT vision is a critical component in setting strategy. The complexity of consumer interactions with a firm’s brand, demands increasingly sophisticated infrastructure and data management tools to ensure that a firm can meet the needs of these consumers.

Similarly, firms ought to align financial management goals within this marketing-IT milieu. Financial concerns, in this context, center around setting proper marketing metrics to measure ROI and lifetime value of a customer. The paper points out that

[A] number of financial concepts (e.g. capital asset pricing model, portfolio theory, and real option approaches) have recently been transferred to customer portfolios…Such “marketing metrics”, based on these approaches and thus taking a future-oriented, long-term, cashflow oriented, and risk adjusted perspective, allow for an identification and measurement of the economic value contribution and the ROI of marketing[.]

To enable such penetrative insights, firms need to leverage data mining tools to create timely (i.e., near real-time) metrics to be shared across business to ensure uniform adherence to meeting clients’ expectations.

eLoyalty and customer relationship management and customer care management principles

This e-loyalty research paper helps clarify the roll of online customer service in creating customer loyalty (“e-loyalty”). The paper focuses on the Austrian mobile industry but the findings are applicable to many industries, including real estate.

Two broad categories frame customer loyalty: customers who become your repeat purchasers and customers who become promoters of your brand. Superior customer service across the pre-purchase, acquisition, and post-purchase stages of a typical transaction is the differentiator for brands.

The Internet consumer, more and more, is demanding personalized and targeted customer service. Data acquisition strategies, such as registration forms, tying information to a user’s social graph, etc, enable companies to perform this customization and targeting while supporting broader electronic Customer Relationship Management (eCRM) and electronic Customer Care Management (eCCM) strategies.

The researchers conducted a variety of online surveys, crunched the numbers and found that timely and personalized responses to customer complaints was a key influencer on whether a customer would switch mobile carriers. Extrapolating this to other industries one can posit that brands which leverage unified technology solutions to enable quicker and more informed customer service will undoubtably have a competitive advantage.

User participation in a QR quirky world

This video, The World Park Campaign, illustrates an excellent use of QR to not only drive a marketing result but reward users’ participation with something delightful. The focus of the campaign was an immersive marketing experience to drive wider participation and learning within a NYC park.

Similarly, read about what Bjork is doing to take participation with music to new levels. What Bjork has done is create a way to interact with her music via an app; for example:

Bjork fans with iPads or iPhones (there’s no Android version yet) can download a main app for Biophilia that’s free. You tap on it and open up to a black background with white, glowing starlike objects. Using your fingers to swipe and tap, the universe expands and turns, and bits of music and songs emerge.

Each song has its own star. You tap on it, and you can buy its app for $1.99 from the iTunes Store. Each one has essays about music and science, and each interacts with its song in a different way. Take “Thunderbolt,” whose arpeggiated bass line you can change by tapping on a lightning icon.

“You change the speed of the arpeggio, or the range,” Bjork says. “Basically, you’re like this crazy lightning bass player.

It’s the participation economy. Participatory media is the message (visit here for reference point).

Demographic shift, Google stealth social network, rich media

Three blog posts that recently piqued my interest:

Wake up, the demographic shift is flattening us. Although targeted at catalog marketing executives, what Kevin Hillstrom has to say is relevant to the marketer in us all. Here’s the essential take-away:

Right now, “The Big Shift” is steamrolling us.  We are essentially addressing the 55+ audience, and wondering why our businesses are eroding?  We must begin investing in the 18-44 year old audience, if we want to remain relevant in 2020, while optimizing profitability from catalog mailings to the 55+ audience.

Very poignant observation, and very applicable concepts to the real estate industry.

Is Google building a stealth social network? Well-reasoned argument that Google is doing this, and that Google’s +1 initiative is part of a series of tactics Google has recently deployed to continue playing its ground game in the social sphere.

Rich media + display ads + social = advertising perfect CTR-engagement metric storm? “Rich media” (aka multimedia) has been around for some time. Similarly, rich media has had periodic bursts of hype and utilization for over a decade (anyone who was in the email marketing space around 1998/1999 will recall the covey of rich media vendors present at the variety of “internet conferences” that occurred during the same time period). Well, it seems rich media is back again (like a poltergeist?) and advertisers seem excited (according to the article). What’s interesting to me is whether there’s an opportunity for enhanced engagement via a rich media ad conduit that will support social CRM initiatives.

 

Micro-targeting and organizational communication theories fueling word of mouth marketing

Below are two fascinating studies on communication theory and practice. The commonality between both is the nexus between effective use of social media and word-of-mouth marketing.

The first study Social Media Marketing vs. Prevalent Marketing Practices: A Study of Marketing Approaches for Micro firms in Sweden (.pdf download) focuses on micro firms leveraging social media to promote higher customer loyalty. The author sought to answer the following questions:

  1. Which of the two types of marketing is more effective in terms of targeted segment coverage and expenditures?
  2. Which marketing approach enables micro firms to maintain better relationships with customers?
  3. Whether or not it is the right time for micro firms in Sweden to adopt social media marketing practices?

The heart of the study is Section 4.2.3.

The second study, Structured Viral Communication: The Political Economy and Social Organization of Digital Disintermediation (.pdf), is the best analysis I’ve read of how Obama used structured communication plans to spread his message and increase loyalty.

Photo credit ssoosay

The importance of users versus consumers in building a community

The book Democratizing Innovation by MIT Professor Eric Von Hippel (available via free .pdf download) makes an interesting observation about the term “consumer”. Throughout his book, Von Hippel employs the term “user” as opposed to consumer:

Users, as the term will be used in this book, are firms or individual consumers that expect to benefit from using a product or a service. In contrast, manufacturers expect to benefit from selling a product or a service.

This is a powerful–albeit simple–point of distinction within the context of the social web, with implications for social commerce too (which I have recently written about here). Focus primarily on the benefits of the user, not solely on your needs as a “manufacturer”. What value are you bringing a user of your content, service, advice, etc? By constantly evaluating the needs of your user-clients and delivering benefits based on these needs, you’re increasing the odds that your user-clients will become a passionate community centered around this value as opposed to simply a crowd that wanders by.

Gartner hype cycle and emerging media curve balls, change-ups, fastballs and Steve Harney’s 5Cs

The Gartner Hype Cycle is a useful graph for analyzing technology hype. Looking at the Gartner graph, I’ll posit we’re somewhere near the “Slope of Enlightenment” and the “Plateau of Productivity” with respect to social media. Over the past couple of years, business leaders have stepped up to the plate and faced some serious pitches while trying to figure out a sound business strategy that leverages social/emerging media. Indeed figuring out how to intelligently deploy emerging media can be like facing pitcher Stephen Strasburg.

Are augmented reality concepts a curve ball to your mobile strategy? Are emerging legal issues surrounding privacy, intellectual property ownership, open source and cloud computing licensing, etc, a change-up to your business game plan? Is the iPad a fastball?

It’s clear the pace of emerging media will continue unabated. Business leaders will continue to face a tsunami of innovation. Thus, it’s great to have a working archetype, or mantra to fall back on when analyzing whether to adopt an emerging media in your business plan. To this regard, Steve Harney has some excellent tips.

During a recent interview I had with Steve, he articulated a process he calls the “5C’s”. Harney’s list of 5C’s is a useful checklist to run through when you’re thinking about how to leverage emerging media—particularly social media—to achieve a business objective. Steve’s successful blog, Facebook page, and KCM Quick Report represent a choreographed social presence that he’s used to build a community that supports his business objectives.

Steve Harney’s 5C’s:

  1. Concept: Understand the concept of what you’re trying to do. What is your brand? What do you want to be seen as? What are your core values?
  2. Conviction: Have conviction to your brand. Once you have established your concept, how much conviction do you have to that brand concept? Ensure that your brand concept is translated into everything you do. The allure of emerging media—particularly social media—is that it’s omnipresent and relatively easy to deploy…and easy to get side-tracked. For example, when Steve launched his Facebook page, he decided that he did not want to dabble in Farmville, Mafia Wars, etc, because those social media activities—although fun, engaging, and playful—were not aligned with the core concepts of his brand.
  3. Consistency: Let your community know that you’re there for them on a consistent basis. For Steve’s brand it’s important to blog every day and update Facebook every day. His community has come to expect this. He therefore must maintain consistency to meet this expectation.
  4. Content: Focus on getting and supplying great content. Ensure that your content is strong and relevant to the community you’ve developed. Act like a curator.
  5. Collaboration: Allow your community to come up with the answers. Provide an environment that promotes sharing of ideas. Bringing minds together so they can learn from themselves is the key driver to getting the community passionate about you and your brand. Actively facilitate discussions that align with the Concept of your brand.

Photo credit: david.nikonvscanon

Collaborative CRM strategies and concepts

Collaborative CRM strategies offer firms unparalleled opportunities for establishing more meaningful relationships with their customers and clients.  Mobile CRM is closely aligned to collaborative CRM concepts. This research paper characterizes collaborative CRM as:

The notion of collaborative CRM is still in discussion and has two interpretations that are often mixed…The first is closely connected with communicative CRM and focuses on interaction channels (e.g. phone, fax, e-mail, self service portals) between a company and its direct customers. The second extends the CRM concept on the level of value chains and business networks. This approach consolidates concepts of networked organizations and marketing to enable the creation of customer relations and value at a network level by sharing or pooling of network resources and capabilities…It enables producers, distributors and service providers to extend their customer acquisition, retention and development beyond their company borders and even to involve the customer directly.

Fundamental concepts of Web 2.0 and the social web such as transparency, authenticity, trust, engagement, and listening underpin collaborative CRM concepts. Similarly, customers’ demands for immediacy and relevancy in communications further support collaborative CRM. And mobile technologies have the potential to be the catalyst to firms’ implementation of collaborative CRM practices. But as pointed out in the research paper mobile technologies are not a panacea for collaborative CRM. The researchers point out that to facilitate collaborative CRM goals, existing business processes must be redesigned so as to take advantage of the unique characteristics of mobile technologies while delivering additional value to customers. Many companies are simply using mobile technologies to deliver information in a one-dimensional manner (i.e., a messaging service) as opposed to a multi-dimensional manner.

The authors conclude with several recommendations to consider when setting up a collaborative CRM strategy:

  1. Set up appropriate customer segments, which allows firms to deliver individualized services
  2. The CRM system must integrate mobile data (mobile sales, mobile content usage, location based services, etc)
  3. Ensure customers understand that a firm’s mobile services offer enhanced value so they will make use of these services
  4. Firms should consider specialized mobile CRM data analytics platforms that integrate with core CRM systems because current core CRM platforms lack sufficient sophistication to account for mobile CRM data needs

Photo credit: The Lightworks

1) Set up appropriate customer segments, which allows firms to deliver individualized services
2) The CRM system must integrate mobile data (mobile sales, mobile content usage, location based services, etc)
3) Ensure customers understand that a firm’s mobile services of enhanced value so they will make use of these services
4) Firms should consider specialized mobile CRM data analytics platforms that integrate with core CRM systems because current core CRM platforms lack sufficient sophistication to account for mobile CRM data needs
Photo credit: The Lightworkshttp://www.flickr.com/photos/leonardlow/1142365603/

Satisfied customers are more loyal than delighted customers

This research paper focusing on the hotel industry indicates that although delighted customers have generally positively views of brands, a satisfied customer will more likely take action supportive of loyalty marketing constructs (i.e., actually book a return trip) because they have an emotional connection to the brand. Thus, the researchers suggest that marketers focus on loyalty programs that seek to instill positive emotional experiences with the brand. Such mechanics go beyond baseline experiences like prompt response times, meaningful communications, knowing where a customer is in the life-cycle of a transaction, and extend to activities that prompt a positive emotional response (like receiving a handwritten thank you card).

Customer loyalty CRM and customer satisfaction

This research paper on CRM strategies used by RBC Royal Bank of Canada (Bahamas), analyzes whether the bank successfully applied the four P’s of CRM (planning, people, process, and platform). It’s well established that financial success is tied to a well executed CRM strategy which drives customer loyalty and customer satisfaction. What this research paper found was that although the bank lists CRM as a strategic initiative and policy, it has not integrated the CRM process at each customer touch point. The methodology used to correct the problem was instituting a wide-ranging customer satisfaction survey initiative to ascertain–from the customers’ viewpoints–where the service breakdowns and gaps actually occurred and to make changes accordingly at those points.

Using text analytics to increase customer engagement and loyalty

I love it when research/theory manifests in application/practicality. In 2007, I wrote about research being conducted on semantic analysis related to social media and blogs, and now there are companies using products stemming from this type of research.

Information Week covered text analytics, describing how JetBlue uses text analytics to understand customer sentiment from email messages, which informed the airline how to draft its customer bill of rights. And KMWorld discusses how the burgeoning field of “customer experience analysis” uses text analytics to increase customer engagement and loyalty.

Customers today aren’t just customers–they’re influencers and social networkers. Across the Web at any hour, they’re sharing observations about your company’s products and services, and those of your competitors…These new modes of customer behavior make it essential for companies to move beyond traditional ways of gathering, analyzing, and acting on customer information – Information Week

For a long time, text analytics was a technology in search of a business need. Now, thanks to social media, the need is there; the question is whether the technology can ramp up fast enough to be commercial – KMWorld

Where social media in real estate sometimes has the floor manners of a dog’s breakfast, it’ll become increasingly important for real estate firms to engage in text-sentiment analysis as part of their overall CRM and customer experience efforts. Here’s a list of companies that offer text-sentiment analysis services:

Photo credit: mnapoleon

Customer strategy departments driving customer loyalty

This Harvard Business Review article (subscription necessary) makes a strong case for companies to create customer strategy departments and positions. One section of the article focuses on “Customer-facing functions” and makes some great recommendations:

  • Customer Relationship Management (CRM) responsibility should migrate away from corporate IT and into the customer strategy department since CRM helps companies assess customers needs and wants and that’s the role of customer strategists
  • Market research should break-out of the marketing department silo and extend to all departments and focus bilaterally on the aggregate and the individual (for example, creating customer profiles as espoused in the book, The New Rules of Marketing & PR) with a singular focus on customer for life (CLV) and customer equity metrics to measure success (here’s a sample lifetime value of a customer analysis from the Database Marketing Institute that will help you begin thinking about CLV metrics
  • Customer strategists should drive the product development process rather than the engineers; the article notes that NOKIA launched NOKIA Beta Labs in Asia and enjoys 60% market share there because, in part, this developer community helps drive the product development process, whereas in the U.S. Nokia pursued a different strategy that has far less consumer input and has suffered

Voice of the customer is not a new concept in product design and development. It’s sure refreshing to see HBR tackle this issue. What’s your view of creating a customer strategist role in a company?

Photo: ishrona

Innovation and cross-functional team differentiation for competitive advantage

What factors influence effective cross-functional team environments that spur the greatest innovations and competitive advantage? The authors of this study (.pdf) (focusing on manufacturing) determined that baldly implementing a cross-functional team approach is not a universal good. Notably, the authors found that cross-functional teamwork involving marketing may have a negative effect (the authors noted too, however, that this finding contradicts earlier studies). The authors conclude that companies should focus cross-functional teams on product design, development, and engineering so as to yield the highest gains in terms of innovation. I’ll posit that this finding can be applied to firms outside the manufacturing industry that are focused on software development and related product development activities.

Interestingly, this study (.pdf) concludes that many marketing departments exert positive influence on a firm’s overall market innovation in the following areas: advertising, relationship management, segmentation, targeting, and positioning. Marketing departments can influence product innovations through their overarching customer knowledge and insight into trends. Thus, a way to effectively involve marketing in cross-functional teams focused on software-related product development activities is to have the marketing team drive a voice of the customer ethos throughout the ideation and development process.

Customer loyalty and corporate reputation

To what extent does corporate reputation affect customer loyalty? This study (.pdf, begin reading at page 28) found that corporate social responsibility (CSR) is the second most important factor influencing corporate reputation (with overall competency being first). In fact, CSR was found to have a higher impact on corporate reputation than product price. The authors posit that CSR impacts customer loyalty because such corporate behavior elicits customers’ positive emotions. Left unresolved is whether a company can over-leverage such CSR activities in its push to drive customer loyalty. In other words, where is a marketing line crossed in customers’ eyes where a negative emotion is associated with a company’s overt efforts to leverage its CSR activities; is there diminishing returns on such “cause marketing” activities.

Related post: Positive Authority and Digital Reputation

Customer loyalty and online community development

What factors keep an online community happy, involved, and engaged? The authors of this study (.pdf) found four primary things influence these three factors:

  • Purpose: Clearly define the purpose and values of the community space with a well-articulated and succinct statement so people who join the community know what to expect, while internally defining your (i.e., corporate) goal of the community
  • Monitor: Before you can know how a community vibe ebbs and flows, you must monitor the community’s interactions, and “embrace” community leaders perhaps by elevating their status within the community
  • Feedback: Implement meaningful rating systems (the authors site a rating system that reflects users’ behavior as an example of a meaningful rating system, as opposed to a simple “top ten” type system)
  • Organization: Clearly guide new community members about where to go, what to do, how to get acquainted, etc, while cuing or gently nudging existing users with meaningful suggestions and topics on how the community can grow and evolve

Related post: Community crowdsourcing and innovation

Customer loyalty and employee engagement

To what extent does employee loyalty and commitment to a brand drive overall customer loyalty? This research paper (.pdf) tackles that question and concludes that employee attitudes toward their company have a high degree of impact on customer loyalty. What the authors essentially argue is that fostering a corporate environment that espouses a unique and positive corporate culture grounded in clearly defined values goes a long way to inspire employees to be more engaged with their company and brand.  Once this baseline is met, the authors propose that brands create internal employee engagement indexes to monitor employee sentiments toward the brand (similar in concept to consumer engagement metrics) to ensure they remain committed to the brand and ultimately the customer. Thus, the company can ensure that it’s employees are working towards increasing customer loyalty. A perfect example of this is Zappos.

Related posts:  Creating a culture of creativity and innovation and Creativity Integrity and Brand Differentiation

Customer loyalty and customer trust

Trust is a major driver of customer loyalty. How does a corporate brand secure this trust following a breakdown in service delivery? The authors of this study (.pdf) ponder this question and proffer some intriguing insights. The authors argue that negative emotions experienced by a customer following a negative service experience do not necessarily change his or her attitude towards the service provider; rather, the customer simply leaves the service provider. Although losing a customer is never good, this finding is somewhat good news because it seems that customers are unlikely to carry a negative emotion for long with respect to the brand following a service break-down, thus minimizing the chance of an emotive outburst via social media that negatively affects the brand. On the flip side, a brand can enhance the trust and loyalty of its customer base if it honestly admits a mistake and vigorously works to correct such.

Related post: Trust indicators in social network marketing

Leveraging user-generated content

Razorfish points out keen ways to leverage user-generated content (UGC). In the midst of all this social media mania marketers can leverage UGC to gain insight and develop relationships. A poignant take-away from the Razorfish blog post: UGC is  not problematic in it’s own right, rather it’s filtering UGC to gain actionable intelligence that will make for meaningful engagement with customers and clients to build long-term relationships with them. Best quotes from the article:

The problem isn’t with UGC, it is with the filtering, sorting and prioritization and that’s where the technology, the semantic web and also the ability to filter through the lens of a social graph is going to make a big difference.

Leveraging user-generated content are the same ones that marketers and sales people have been preaching for decades: 1) build relationships, and 2) provide value that fills consumers’ needs/wants.

Companies (and individuals) have long espoused transparency, of course, but the economic and viral advantages of tapping and responding to user-generated content are nudging us into arenas of more authentic rather than staged transparency.

The future of UGC global rights management will lie in solutions that strike a perfect balance between the goals of the copyright holder and that of the user.

Photo credit: jelene

Niche marketing and passionate brand ambassadors

Deux Gros Nez, an eclectic, wonderful restaurant in Reno, Nevada, closed its doors a couple of years ago. It’s where I, as a dedicated employee of Tim Healion and Jon Jesse (then owners of Deux Gros Nez), learned about community, service, and the power of passionate brand ambassadors:

Flickr tribute

YouTube interview

A person’s thoughts on its closing

Deux Gros Nez opened its doors June 18, 1985 and began serving espresso, scones, focaccia, and frappes in a gambling town. It was open 24 hours a day, but where 99 cent breakfasts and watered down coffee were king, the Duex Gros Nez cuisine appealed not to the masses. Nevertheless, Deux Gros Nez cultivated a tribal following. This was my first lesson in niche marketing: don’t worry about the masses, worry about perfecting your niche brand and appealing to a niche audience.

This niche audience from the very beginning included lawyers, punks, doctors, architects, professional athletes, artists, etc. Each person had their own reason for frequenting Deux Gros Nez but the common unifying thread was the passion of the owners for delivering “honest” food and a dining experience that was outside the norm of a gambling town (frequent patrons were often met with a friendly greeting along with their type of coffee–brewed, espresso, cappuccino–waiting for them before they walked in because the owners knew what time they’d arrive and remembered what they liked). This was my second lesson in niche marketing: be passionate about what you do, focus on honesty, be passionate and concerned about your customers’ needs.

Part of my job was to train new hires to aspire to a high degree of customer service. The challenge was to inspire part-time employees–many of which were college students, snowboarders, and the like–to engage each customer on a one-to-one level. This was a tall order considering that only two or three employees on any one five-hour shift would have to take the orders, prepare the food, serve the food, bus the tables, ring-up orders, keep inventory, re-stock, and wear a bolo tie (purchased or homemade, the best homemade one being a hollowed-out egg run-through with a string). Sometimes we failed in our quest for customer service excellence. But many times we succeeded. And this success was embodied in creating “wow” events for Deux Gros Nez guests. For example, I would inspire our team to recognize the sound of a dropped utensil when it hit the floor. If you listen carefully, each utensil has a different tonality. This was useful when, on a crowded Friday night, a guest would invariably drop a spoon and the team member working the floor would replace the spoon before the customer asked. This created a great customer service “wow” event, marked the Deux Gros Nez brand in the mind of the guest, and created an incentive to come back. This was my third lesson in niche marketing, especially as it relates to a service industry: training and a appreciation for ensuring that your customers have the best experience goes a long way towards inspiring those customers to be your brand ambassadors.

This is not to say that Deux Gros Nez (which means “two big noses”) did not have a reputation with some people as being somewhat snobby, and that every person who dined there became a brand ambassador, but the restaurant cultivated passionate brand ambassadors worldwide, as evidenced by the fact that people flew-in from all over the world to be at the farewell party (see the Flickr tribute above). The Deux Gros Nez community continues on Facebook via The Fort group page. This was/is my fourth lesson in niche marketing: passion combined with a willingness to pursue excellence and honestly engage your customers inspires your customers to keep your brand flame alive, even when you’re gone.

Tim Healion (known as “The Chief” to all who frequented Duex Gros Nez), currently, has transferred his passion, honesty, and pursuit of excellence to one of this nation’s top professional cycling events, the Tour de Nez. Chief, thank you and keep it going.

List of social Web resources 07-02-2009

Chris Brogan interview
Excellent interview with Chris Brogan on how he’d run an airline and implement some social web karma; great insights, well worth the 9:58 investment of your time. The interviewer, Shashank Nigam, CEO, SimpliFlying, asks some really good questions. My comment after listening to the interview: That was seriously cool.

Semantic Web
This post re-confirms to me that the semantic web (i.e., Web 3.0) is still a ways out from being widely deployed, yet absolutely filled with so much promise and visionary thinking.

Dunkin’ Donuts
Insightful post on how Dunkin’ Donuts uses the social web to extend its brand engagement. Dunkin’ Donuts’ recently released Dunkin’ Run app is a nice, simple deployment of a social app that has a built-in ROI component: buying doughnuts.

Vyoom
Interesting TechCrunch profile of Vyoom, which is a social networking site that gives you redeemable points for your participation. The more points you accumulate, the more stuff you can buy. Not sure whether this will work as a stand-alone application/concept, but could certainly see this applied in a rewards program under a major brand (e.g., Southwest’s Rapid Rewards program).

Twitter
Interesting ideas on why Gen Y may not “get” Twitter.

Consumer centric disruption

Thank you to Nic Brisbourne and his The Equity Kicker blog for (a) highlighting an intriguing video of UK journalists debating the veracity and viability of blogs and (b) pointing out an excellent presentation on the Customer Development Model. Both offer some tasty take-aways.

I find the debate curious. Universal McCann’s 2008 Wave 3 study points out (page 22) that 17.8 million people in the UK have read blogs; this 17.8 million represents 32.1% of the total 16-54 population (in comparison 60.3 million people in the US–33.2% of the total 16-54 population–have read blogs). It seems to me–based on the anecdotal comments of the UK journalists in the video–that UK traditional news media has metaphorically walled itself up and studies blog culture with a telescope, as opposed to latching on to the interesting facets of blogs that attract readers and then combining these facets with traditional journalistic norms and ethos (during the debate some very sound and rational points were made about the role “traditional” journalism has in terms of checks and balances, fact checking, etc). Nevertheless, some very powerful apps and news platforms could result by embracing social web norms. For example, why not take an EveryBlock approach (see Russian Hill) and combine that with traditional beat reporting on the more nuanced and interesting stories cited in the raw data feed. Indeed, one could use EveryBlock data to track patterns which could form the basis for an investigative reporting series.

A visit to slide number 27 of the Customer Development Model presentation offers a succinct and cogent illustration of a consumer-centric product/service development process. The key elements of the slide: Build, Measure, Learn integrated in the overall development life cycle. If I were able to question the UK journalist panel, I’d ask a couple of questions: Do you know of any UK news company to have empaneled a group of consumers that routinely gather their news from blog sites so as to find out why these consumers like these blogs and how they use the blog information in their daily lives? Do you know of any UK news company that has analyzed what apps or smart phone devices their consumers use on a daily basis and how they would like to have news integrated in similar ways on their devices? The answers to these questions begin the consumer-centric design journey.

Finally, this article makes a compelling case as to how certain facets of the Customer Development Model can be a disruptive factor in the real estate industry.

Responsiveness Drives Differentiation

Are your prospective clients having to act like abalone divers to interact with you? Abalone divers furbish themselves with an abalone iron to pry off abalones from submerged rocks. These divers are committed to their task, as abalone is considered a divine delicacy to some. But if prospective clients have to work like an abalone diver to communicate with and engage you, chances are they’ll dive elsewhere.

Concierge service is not a new topic, it still resonates. Let’s assume you have a robust lead acquisition strategy that runs the gamut from SEO, SEM, social media, targeted print ads, etc. Let’s assume too that this strategy yields a healthy inbound inquiry pipeline. Let’s also assume that–if you’re a brokerage–you have a decent eCommerce, relocation, and/or Internet lead management team that responds in a timely manner to these inquiries whether they’ve come in by email, telephone, or live chat. Finally, let’s assume that as an agent you get lead inquiries directly (from your blog, website, broker, etc) and/or leads are routed to you via a relocation or lead management team. What’s the average response time to these direct-to-agent or eCommerce-to-agent leads? If it’s over 15 minutes, I posit that is too long (for eCommerce-to-agent leads, I say response time should be under 5 minutes).

According to the 2008 NAR Profile of Home Buyers and Sellers:

  • 21% of home buyers say reputation is an important factor when choosing an agent, which is the second most important factor out of eight factors polled, the number one factor (at 29%) is agent honesty and trustworthiness
  • 93% of home buyers rate responsiveness as “very important” when considering agent skills
  • 84% of home buyers rate communication skills as “very important” when considering agents skills
  • 67% of all buyers interview only one agent in their search process

Do prospective clients visit the following types of sites more often than real estate websites: BassPro.com, Cabelas.com, Zappos.com, Craigslist.com, Geico.com? I’ll posit that your prospective clients are visiting these types of sites more often than any one real estate site. Thus, their customer service–their concierge service–expectations are being set by these entities. Where does your service level measure up related to these companies?

Put yourself in the shoes of a consumer who goes to BassPro.com and contacts their customer support staff and gets a response within one minute or less (especially if he/she used live chat). Would you say this consumer has a higher likelihood of being satisfied and that BassPro likely created a good vibe for its brand in the mind of that consumer? I’d say yes. Now what would happen if that consumer had to wait for 48 or 72 hours for a response to his/her question that common sense tells him/her should take only a couple of minutes? I’d say a bad vibe is created. Granted, if the customer is committed enough, he/she may try to pry a response out of BassPro by recontacting them. But the more he/she has to try and pry the customer service abalone shell off the rock, the less likely this customer will remain with BassPro. And if prospective clients have to pry a response out of you, the less likely they are to engage with you.

Prospective clients expect responsiveness. And their expectation for this responsiveness is being set OUTSIDE the real estate industry. Thus, it’s incumbent upon real estate professionals to step up to the client concierge service plate and respond as quickly as possible to inbound lead inquiries.

Where do you want your trustworthiness and reputation factors to be slotted in a prospective client’s mind: as uncaring and lazy because you don’t typically respond in a timely manner, or that you’re concerned about prospective clients’ needs and desires? Thus, meet 93% of home buyers’ expectations and set a standard to respond to inquiries in a timely manner. If 84% of home buyers consider communication skills as very important, how are you demonstrating your communication skills–as ignoring a prospective client’s requests, or by addressing him/her with alacrity and professionalism?

Don’t make prospective clients pry a response out of you. Remember that 67% of prospective clients contact and interview only one agent during their search process. Increase your odds of gaining a client’s trust and business by quickly responding to their inquiries.

Photo attribution: Abalone divers, Queue

Creativity Integrity and Brand Differentiation

Chris Brogan’s recent post challenges marketers to begin thinking of ways to use the social web to leverage traditional marketing expertise:

Marketers, are you paying attention to who’s spending how much and where when you read magazines, watch TV, or see billboards? Are you extrapolating out what it means to you, your business, etc?…If you’re in media, the stories are all around you. The model’s broken. Yep. The numbers are smaller. Yep. People aren’t as into paper. Yep. Ads online don’t make as much money as on paper. Sad, but yep.

Consider too this statement from Brian Solis:

While numbers indicate that Social Media Marketing may, for now, be recession proof, it is not idiot proof. Engaging in transparent conversations in social networks to build brand-centric communities is meaningless without intelligence, sincerity and a real world business acumen that can tie participation to important business metrics.

Assume a day in the not too distant future where 90% of your competitors have viable and cogent strategies for utilizing Facebook, Twitter, blogs, video, social CRM applications, etc. In this environment, where’s your edge? Where’s your competitive points of differentiation? How will your messages cut through the noise and fragmented media channels? I say it nets down to two main buckets: Creativity and Integrity.

Creativity

Calders 1968 Nenuphar In The Lincoln Gallery
Calder's 1968 Nenuphar In The Lincoln Gallery

@doverbey (aka Derek Overbey) is a creative person, a talented marketer and prolific–and effective–user of social media. This year he attended SXSW for the first time and knew he could meet people like @scobleizer, @gapingvoid, @guykawasaki (for those who’ve never attended a SXSW, that’s one of the hallmarks of the conference and its appeal…you can actually speak freely with many experts in a variety of disciplines…if you can get on their radar). @doverbey turned “could” into “did” by thinking creatively. Knowing that people like @guykawasaki would be hit from all sides and at any time of day for a chat-up, drinks, meeting requests, whatever, he knew that if he had any chance at wrangling a substantive and informative conversation from “stars” like @guykawasaki he’d have to have a “hook” and “angle”; in short, a creative and compelling reason to get these people to spend some time with him. His brainchild: “100interviews“. His methodology: a wordpress blog, some t-shirts, a flip video camera, and a targeted Twitter promotion prior to and during SXSW. His outcome? Visit his site. Here’s what Derek has to say about the experience:

When @morganb (Morgan Brown) and I decided to conduct some interviews at SXSW, I knew we had to have a hook. The thought on trying to do 100 interviews in 4 days had a nice ring to it and provided us with a platform to stand on as we went out and started to secure interview subjects. But I think the aspect that really pushed us over the top was using Twitter to promote and secure the interviewees. Once we secured a couple of bigger names like @guykawasaki, @chrisbrogan and @garyvee and started to tweet that info out, we had people literally coming to us asking if they could get involved. We leveraged the social aspect to do the work for us. Then when we were at the event, people felt like they were missing something if they were not involved because all their social media friends were participating. In closing, I would say this experience showed me the “true power” of social media outside of just connecting. It can really be leveraged as a additional marketing arm but must still have the good idea behind it.

Derek walked into a situation where many of the attendees were just as prolific users of social media as he is, and where many of these individuals perhaps had similar goals to his, but out of literally thousands of attendees he got substantive face-time with these thought-leaders, and captured telling interviews by using his marketing prowess and creative thinking to come-up with a compelling “hook” that was just different enough to make these thought-leaders stop, take notice, and contribute. And in the process he’s branded himself as a social media leader too.

The take-away: You can do the same with your brand by looking at what’s not been done in your vertical in terms of a promotional strategy and use social media to leverage this uniqueness. In a sea of banality what’s your concept that’s simple to execute, but has a “nice ring to it” that will create a buzz tsunami?

Integrity

Integrity
Integrity

Trent Reznor of NIN is a great artist. Whether you like or dislike his music, it’s unlikely you’d disagree that he’s been uncompromising in his art as well as his business acumen. Take 40 minutes out of your day and listen to this interview where Reznor’s answers to the DIGG community questions deliver keen insights into how he’s blended art and business into a strategy that not only propels his brands, but also keeps his core constituency front-and-center and conversant with these brands. What’s clear from the interview is that he’s confident in his own vision, and has been from the start. There’s a point in the interview where he describes how he strategically broke into the music business in the late 1980s by sitting back and really understanding what his unique value was to the music industry, aligning himself with the right label, and using then ground-breaking distribution models (e.g., MTV) to get his art heard. In essence, he looked at his core strengths and passions and leveraged such in the “alternative music” niche that existed at that time. Reznor focused on perfecting his art, stayed true to his vision, and created a truly unique sound which differentiated himself from the crowd of other bands. And once his audience “found” his music, he engaged this audience with ever-increasing diversity coupled with new technologies and distribution methods to increase this engagement (see his recently released iPhone app under his NIN brand for the most recent example of this.

The take-away: Understand your core values and define how you’ll make a difference and then have confidence in your brand, your vision. Keep an uncompromising adherence to these values as you deploy new services and utilize new technologies to spread your vision. And when a constituency embraces your brand, engage this constituency and demonstrate that you understand its core goals, wants, and needs by developing products and services that align with these core values while adhering to yours.

Photo credits: Creativity photo, Takomabibelot; Integrity photo, Jahat

Clients are not cows

Real estate marketing professionals interested in farming, cultivating, or harvesting customers should consider something new. Livestock management perhaps? How about genetic engineering of new hybrid corn? Better yet how about driving a combine or cultivator? It’s time to shed these agri-centric terms that are so often used in conjunction with traditional Customer (Client) Relationship Management (CRM) theories.

Potential and existing clients are neither livestock, corn, nor wheat. Clients are people who have families, passions, wants, desires, and needs. And they likely would not want to be managed, cultivated, harvested, or farmed. Instead they’d likely want a meaningful interaction with your brand where you treat them like a human rather than like an uninformed data element.

As a first step to embracing clients and potential clients as living and breathing HUMANS, rather than disembodied data nodes, firms ought to shed certain traditional labels of CRM as well as agri-centric terms in favor of human-centric labels. Use “client” rather than customer; clients seek professional advice, customers purchase products. As a real estate professional who’s positioning yourself as a trusted adviser and subject matter expert, aren’t you more interesting in engaging clients as opposed to just pushing products?  Similarly, use “engagement” and “conversation” rather than cultivate or nurture; engagement implies a recognition that your client has a role in the CRM process and conversation recognizes that you’re goal is to enlist the client in a dialogue, rather than having them passively remain rooted in your system like a seed and plant in a field until they’re harvested at maturation.

Words matter. And labels inform your conduct. If your CRM system focuses on the human touch, the people element, then your CRM operations become more focused and in tune with promoting engagement and brand partnership. Consumers want to trust your brand. Give them a reason to do so by acting like you trust them.

Photo credit zieak

New Facebook Home Page Useful for Real Estate Pros

Here’s an excellent article on the PR 2.0 blog about the new homepage design features Facebook will soon release. The article gives a reasoned analysis of the new Facebook feature-set as well as possible implications for brands, individuals, and services like Twitter and Friendfeed.

What could be considered the Wall 2.0 or quite simply, a personal or branded activity stream or timeline for people, public figures, and brands, the company is placing your in-network and external network activity at the front-and-center of your public profile for friends, associates, and followers to not only stay up to date with you[sic] aggregated Web activity, but also participate in the stream.

New Facebook Home Page
New Facebook Home Page

The new Facebook home page likely will have positive implications for real estate professionals. First, the new filter feature presumably allows you to separate your contacts into separate channels, monitor those channels, and more easily converse within those channels. This allows you to use Facebook as more of a social media multichannel marketing tool (i.e., by monitoring separate channels you can prioritize those channels and, thus, respond appropriately and in a timely manner as needed). Second, the real-time “stream” feature will give you an accurate pulse of your sphere’s goings on, which is useful in choosing which contact to engage immediately or at a later time (this feeds into the multichannel marketing nature of the filter feature). Finally, the “publisher” aspect of the new Facebook home page seems to give you a more useful–and engaging– way to update your sphere.

Web 2.0 Multichannel Marketing Considerations

Digital Trends is a big topic and this post really goes through a substantive analysis of Edleman’s recent predictions.

The digital train is tearing down the tracks and has no signs of slowing. Every industry is being reshaped by the expectation that everything should be digitized. Add digital hungry consumers with web devices, NetPCs, Kindles and smart gaming consoles and you’ve got a multichannel marketing and distribution train wreck.

Multichannel marketing considerations will certainly be primary this year as fragmented consumer relations with brands accelerate. Thus, firms like SAP have begun tracking social media interactions. Despite the inherent trackability problem presented by fragmented brand interactions with consumers, firms are either “in” or “out” of the social media space. And it seems evident to me that firms should be “in”, as this report on how telecoms use social media demonstrates; given this, here is a list of great tips list for creating content that spreads.

Twitter Please Believe the Hype

Here’s an interview about Twitter with a friend of mine who owns a manufacturing plant in Northwest Chicago. Of course, I was evangelizing the incredible value, benefits, and just awesome coolness of Twitter, but he was a little skeptical…

I think Tom has good advice. It’s easy to get caught up in a Gartner hype cycle, becoming fascinated and enthralled with a technology and thinking it’s value resides simply in its sheer technical coolness. This said, I’m still convinced Twitter is one of the best applications a real estate firm and agent can use to build their personal brand as well as eventually drive transactions. UPDATE: Check out this NYTimes article on the power of Twitter.

In a similar vein I’m having much more meaningful conversations and interactions over Twitter than via telephone and email. I think it’s because Twitter forces you to think crisply and communicate with brevity, mirroring “live” conversations in a way. And in thinking again about ‘ol Notorious’ recent post, it’s this aspect of Twitter–and other social media applications in general–that make it (them) such huge brand-building tools.

Top down branding campaigns are typically forced on consumers like geese trapped in a foie gras factory, delivered in 15 second to 30 second snippets that really don’t change that much. Whereas social media relies on relationships that naturally evolve over time. And it’s this aspect of social media–its repartee–that allows a brand to develop a “personality” that a consumer can choose to befriend. Assuming a consumer remains engaged and interacting with a brand under these circumstances, it stands to reason that consumer affinity and loyalty with/to a brand would be higher than with/though traditional media campaigns.

Theatre of Cruelty in a Carnival of Real Estate

What’s the value of a real estate firm’s or agent’s service? What actions justify a firm’s or agent’s fees? I’m contemplating these questions as I re-read “The Theatre and Its Double” written by Antonin Artaud, and some of what he says in his writing has a certain philosophical resonance with respect to the current state of affairs in the real estate industry.

Artaud was an early 20th century French playwright. He challenged existing theatrical norms of his day to strip away historical groundings with respect to performance (which he generally thought were overproduced parodies of themselves) and show a more honest–transparent–personification of character, thought, or theme, where the actor is the ultimate provocateur of an honest dialogue with her audience, whilst producers and directors contentedly cling to the status quo. In Chapter 6, “No More Masterpieces”, Artaud states:

Far from blaming the public, we ought to blame the formal screen we interpose between ourselves and the public[.]

He continues at a more sublime level:

Enough of personal poems, benefitting those who create them much more than those who read them.

Theatre changed for the better after Artaud’s call to action. Similarly, it seems to me, the real estate industry is due for an Artaud-like challenge to existing norms with respect to representation, compensation, and professionalism. The run-up to 2009 was indeed a real spectacle, but the tent has fallen, the elephants have flattened the performance space, and the audience seems to have run away. Indeed, many have written about the current state of affairs.

But here are perhaps two of the the clearest calls to action to change the status quo–two honest evaluations of the state of affairs with respect to the relationship between real estate professional and consumer. Neither author engages in finger pointing, tries to push off responsibility, nor cringes from the challenge to ask hard questions and honestly answer these questions.

Rather, there is a recognition that the forum has changed, that same old lines fall on increasingly calloused consumer ears. Indeed, the authors’ challenges to the “old rules” of relationship and dialogue between real estate professional and consumer especially resonate when one of these authors had a consumer click through to his blog from the search “buyer’s real estate commission myth“. Clearly this consumer was seeking a different type of relationship with a real estate professional. And, with respect to the norm, this author’s blog post presented an honest–and transparent–alternative conversation. 

Thus begins a few hammer blows to the status quo.

Real estate website technology and engagement

This post on real estate brokerage future and this one on hyper-local targeting are two excellent discussions about the strategic decisions real estate brokers will face over the next few years, especially with the technology side of the equation. I will focus on two salient points from these posts: (1) the ascendancy of broker power relative to agents and agent teams; and (2) the “Human Touch”.

In the first post, the author essentially argues that “Big Brokerage” along with a constellation of boutique firms will emerge dominate over the next few years. Not only is this argument valid in my opinion, but follows the power law principle, which has been proven in many other social, scientific, and natural systems. Interestingly, the author also skims the surface on some historical trends too. Having just finished reading the Rise and Fall of Great Powers, I’m seeing a correlation in the real estate industry to what existed in the late 1600s through early 1800s in Europe, which saw “old” powers atrophy and “new” powers emerge. Many national firms are under distress and, thus, weakened competitively when confronted by attempts at marketshare gains made by rivals (i.e., analogous to the Hapsburg’s loss of power). What may emerge in the near term is a balkanized set of real estate brokerage fiefdoms (all following the power law principle within their own market) but no one true national “winner”. Over time these fiefdoms (or principalities) will begin competing along their borders too, where the brokerages that strategically deploy technology gain advantage (just like the principalities and states that adopted new forms of weaponry won their military campaigns during the afore-mentioned time period).

Which brings me to my second issue the, “Human Touch“. I’ve always argued that real estate is a participation sport. And technology should serve one principal service: get an arms-length positioned consumer in front of an agent as quickly as possible…but it’s the manner by which this occurs that separates effectiveness from mere happenstance.

Many agents despise Internet leads, and sometimes with good reason. Too many “leads” an agent receives are really a waste of time from the agent’s perspective (too many questions, too many meetings, too many emails, not enough transaction); this tends to breed resentment, bitterness, and non-effectiveness. Thus, smart brokerages employ a lead qualification layer operating under a managed care rubric that works with potential clients prior to handing them off to an agent (in my opinion agents by and large are “closers” not “nurture-ers” and their talents are not deployed optimally when called upon to nurture consumers). And it’s in the managed care environment where firms can make the most gains.

Let’s assume an ideal state of technology circumstances for a brokerage principality that wants to gain consumer mindshare (and, thus, marketshare). This brokerage’s website would consist of the following primary entry points for potential (and existing) clients (all very consumer-facing, focusing on consumers’ needs and points-of-view):

  • Tag clouds that demonstrate inventory density demarcated along neighborhood, price, zip code, lifestyle, and home-type attributes
  • Search clouds that demonstrate what consumers have been most interested in within the site
  • Lifestyle-oriented search (which I’ve written about previously)
  • Targeted site elements driven by a Site +1 engine (I have not seen this product work, but will give the company the benefit of the doubt and assume that it works as advertised) that presents relevant imagery, content, property type suggestions, and calls to action that meet the potential client’s assumed demographic/psychographic profile in a predictive sense
  • Map display that presents data in compelling ways (like search cloud data overlaid on a Google map)

Deploying such site elements not only meets consumers expectations at a high level by presenting them with features they are “familiar” with by virtue of visiting other types of websites more frequently than a real estate website, namely sites like Amazon and blogs (my previous post references a Universal McCann study stating that blogs have just as much reach as traditional media). But more importantly a Utopian site like the one I’ve described is geared towards four primary things: not wasting the consumer’s time, presenting them with multiple ways to access information, speaking relevantly to them immediately, and incenting them to contact a “human” as quickly and efficiently as possible.

This type of a site uses engagement-oriented features that compellingly reward a consumer’s time spent on the site by giving them information in a manner that mirrors a “human touch” while actually cross-promoting a “human touch”, rather than penalizing or irritating them with worn, tired, slow, and stale elements. Thus, consumers establish emotional and brand-centric bonds with the brokerage via its website. And when a consumer decides to “reach out” and contact the company, this consumer does so in a more informed and qualified manner, which allows the managed care department to not only engage this consumer at a higher level but transfer a more informed and content consumer to the agent. What’s happened is that “technology” has allowed the consumer–at her leisure–to satiate her information gathering needs in a highly effective and efficient manner, making the site more relevant and trustworthy with respect to her quest, allowed the managed care department to spend less time educating her, and focuses agents’ core competencies on “closing” and transaction management issues; which in the end reinforces the power law principle and propels the marketshare gains the firm seeks.

Adding blog functionality to real estate websites

This Universal McCann study states that

  • Blogs are a mainstream media world-wide and as a collective rival any traditional media
  • The blogsphere is becoming increasingly participatory, now 184m bloggers world-wide

 

And as recently referred to in my previous post on the long tail, the New York Times discusses the power of blogs for real estate firms.

So why are many real estate brokerage web sites so un-blog-like? It seems to me that if consumers are familiar with blogs, frequently read and interact with blogs, brokerage sites ought to adopt “blog-like” functionality on their web sites so as to give consumers modes of “familiarity” when they visit (it’s probably safe to say that consumers interact with non-real estate sites on a much more frequent basis and, thus, their expectations for best-in-class web site experiences are set by these non-real estate sites).

For example, brokerages could create a popular search cloud. Similarly, firms could create a listings type cloud based on property type, location, lifestyle, time-on-market, foreclosure, and price. As demonstrated by Amazon’s “Customers Who Bought This Item Also Bought” product recommendation success, consumers want to know what other consumers are doing and thinking. Thus, a search cloud lets consumers take a pulse of the market by quickly perusing the cloud. Second, a listings cloud quickly lets consumers see what type and how much inventory exists without having to perform a search to get this information.

One click into either cloud quickly sifts the database and returns a results set to the consumer, and from there he/she could further refine a search; thus, reinforcing that the firm’s website is functional, speedily returns results, and respects consumers’ time. Further, these two features would go a long way towards giving consumers something “familiar” while enhancing real estate website functionality and data accessibility. All of the above combines to increase marketing penetration and consumer loyalty.

Gender bias in e-Loyalty programs

An e-Marketer recent report shows that moms are a major power on the Internet.

eMarketer

Notice how FrontDoor.com leverages this fact. And this research article points out that women adopt e-Service loyalty programs at a higher rate if their enjoyment and perceived social presence of the site is high. Notably, the researchers point out that

In particular, online vendors that cater to females may experience more pronounced and positive impacts of conveying a sense of warmth and sociability on their websites.

Notice that on the FrontDoor.com site that “warmth” and “community” is high. Thus, I’d not be surprised if they have a high loyalty rate.

Swarm business / swarm creativity in real estate

Create value for the swarm. That is the overarching goal of a swarm business mindset. Swarm creativity embodies the passion that drives this goal, along with coolhunting as an adjunct exercise. Real estate, as an industry, seems well-poised to take advantage of swarm creativity.

Nicholas G. Carr, of the Economist.com explains the basics of swarm business:

To achieve this status, a swarm-business aspirant must follow three principles. First it must “gain power by giving it away”. For instance the MySpace social-networking site works by granting its users the ability to determine its rules and content. Second, the company must be seen to “share with the swarm”—IBM, for example, has backed Linux’s open-source software with cash and code. Finally, firms must “concentrate on the swarm, not on making money”.

HBS Working Knowledge elaborates on swarm creativity:

There are five essential elements to collaborative innovation networks: learning networks, sound ethical principles, trust and self-organization, making knowledge accessible to everyone, and internal honesty and transparency.

Following Carr’s lead, a real estate firm must first abandon its possessive brand centrality and opt for a more decentralized brand presence. This means consumers, employees, real estate agents, vendors, and management equally “own” the brand. This means, at the core, a firm must open itself up to transparency and honest consumer review; which really means consumer ratings of its website, agents, customer service and then using these ratings as forums–conduits–to engage these consumers as collaborative partners to create a better value proposition. Internally, a firm could create a collaborative swarm between agents, IT, marketing, and management to build on the collaborative concepts derived from the consumer-based swarm insights.

For ROI-minded owners and managers, a swarm exercise is likely a hard pill to swallow, let alone ever digest. This is because swarm creativity lends itself to indirect monetization strategies (as does most social media). This could also be related to the fact that real estate as an industry, at first glance, is not really engaged in new product development processes (swarm creativity naturally lends itself to new product development ideation).

What is the real estate product? A house. What is the service? Representing a buyer or seller while giving advice.

This description is a bit facetious, but the point is that real estate professionals should begin looking at their entire web presence–and service value proposition–as an ongoing product that constantly requires new strategies and ideas that evolves in line with consumer expectations. If 10 swarm exercises yield one new service enhancement strategy that increases customer loyalty and retention, arguably the swarm exercise is worth it; especially if this strategy enhances a full-service agent’s consumer value proposition. In this example, ROI would be indirectly realized: as consumer satisfication increases, referals increase, and competitors suffer a corresponding competitive disadvantage (assuming they are late adopters). By implementing a consumer swarm idea, a firm has rewarded the swarm: first by listening and second by acting on its advice. This, in turn, promotes further honesty and integrity within the swarm and, hopefully, within the firm itself; eventually driving higher ROI over the long-term as internal strategies become integrally aligned with near real-time consumer driven initiatives.

Real estate technology adoption principles

In 2004, Inman News profiled e-mortgage processes. In the ensuing years, paperless mortgage processes have improved but have yet to achieve wide agent adoption rates, as do many other real estate technology initiatives (e.g., real estate ecommerce centers). Could this be a classic example of the Technology Acceptance Model theories at work? ( Wiki definition 1, Wiki definition 2, research paper).

Many real estate firms have invested thousands, if not hundreds of thousands of dollars, in improving their technology offerings for their agents, only to see these technology investments gather dust as seasoned agents largely ignore–or at least fail to take full advantage of–such offerings in favor of their offline processes. The TAM predicts that a user’s perceived value of a technology resource affects this user’s adoption of this technology.

Assume that a brokerage wants to increase Internet ecommerce center participation and satisfaction rate amongst its agent base. This strategy makes good sense, as most real estate consumers begin their searches online, prefer the Internet experience, and eventually work with a real estate agent.

At its base level, a real estate ecommerce center answers mundane questions, finds out where a consumer is in the buying process, helps the consumer sift through much of the generic real estate information, helps the consumer refine search criteria, and then refers this consumer to a real estate agent. At this point, many brokerages would assume it’s the agent’s business to lose. But is it?

Many agents understand this basic qualification service. And this is where these types of services generally stop…basic. In other words, agents still are doing much of the work with an Internet client, in terms of driving towards a conversion, after this consumer is “handed off” to them. Yet from a brokerage’s perspective it’s doing a great service to its real estate agents by funding, staffing, and managing such a service. As such, there is a mutual perceived lack of usefulness on both parties (the agent thinking it’s less useful than it is, the brokerage thinking it’s more useful than it is).

From the standpoint of the agent, perceived usefulness would likely increase if the brokerage did more qualitative analysis prior to a hand off. For example, at varying points in the qualification process, call center personnel can round-out a client’s profile by either entering in data as they converse with a client, or refer clients to online tools that allow them to provide additional profile information. This data would extend beyond such basics as purchase time-line, preferred home type, newsletter selections, etc, and delve into lifestyle, preferred community attributes, etc.

Additionally, a brokerage could append basic demographic data to its pre-transaction consumer file by either using a reverse append service (Experian and Acxiom offer reverse append services that can attach a postal address to a valid email address) or by keying off the postal address the consumer registered with; regardless as to how a postal address is sourced, a brokerage would then be able to overlay zip code-derived lifestyle / life-stage and other demographic data. This would then allow consumers to choose home-types based on lifestyle (the brokerage’s listings database having been similarly overlaid with lifestyle / life-stage data, which enables this type of matching to occur).

These types of fundamental direct marketing techniques drive towards one goal: to hand the real estate agent a consumer who is well-informed and ready to act. Since the brokerage has tracked all phases of the communication leading up to a hand-off, the brokerage can deliver a profile-based client dossier to the agent who can then take this information and better perform his/her roll as a real estate trusted advisor (i.e., the agent can initially engage the consumer with a knowledge and insight gained as if he/she had actually interviewed the client in depth). Thus, the real estate agent focuses on his/her core competency, which in turn reinforces the usefulness of the brokerage’s ecommerce initiatives and further lowers barriers to adoption.

Profiling hedonic data in social networks

Continuing the discussion from the McKinsey interview of Cammie Dunaway, she states

[Yahoo!] is using behavioral data–really mining the wealth of transactional data we have about how people are spending their time online and trying to marry that data with attitudinal data…that’s where the most powerful insights can really come from.

Insights into what? It could be many things. Two of the most studied motivational data elements are utilitarian motivations and hedonic motivations. Utilitarian motivations center around goal-oriented behavior (e.g., I logged in to check my email, I checked my email, I logged out). Hedonic motivations are more social in nature (e.g,. I logged in to explore, to analyze, to decide, to eventually take action).

In real estate search, companies have typically focused on rewarding utilitarian behavior, often in a very reactionary manner. Consumer searches site > Consumer registers > Consumer selects home > Consumer is “passed off” to a real estate agent. Of course, the ultimate goal is to consummate a sale. And improving the “experience” of looking for a home on a real estate firm’s website could actually lead to more loyalty, referrals, and sales.

Nevertheless, overly focusing on “experience” at the expense of a goal can scuttle both consumer loyalty and ROI. Thus, balance lies in properly testing and deploying Web 2.0 assets that fulfill consumer goals while logically jibing with the product subject matter.

So how does mining attitudinal data fit this balanced approach or paradigm? Incenting consumers to add profile information that logically fits a goal is one idea. For example, if a real estate firm’s goal was to create a social network on their site targeted at tapping a suburban soccer mom demographic looking to buy a home, logical profile information may be zip code (current residence and desired residence), schools, sports, design preferences, and home type.

Zip code is important because the firm could relate this consumer to an agent who serves that zip code, where the agent serves as the social network ombudsman(woman) to answer questions and otherwise kick-start the group. Secondly, once a firm understands home type preferences and desired location, the firm can relate specific home information, community information and statistics, and other moms in the network to this person. The additional profile information constitutes community building information (e.g., relating moms who have children in similar sports). These steps help build a community and take the burden off the real estate firm to be all things to all consumers (if a mom has questions about how her child can join a traveling baseball team, she could ask the real estate agent, but more likely she’d ask the community). This way the firm’s “social asset” reinforces the firm’s local expertise, which allows for an eventual monetization of this consumer as she “graduates” through the process into ultimately looking at home types and eventually purchasing a home.

Through the tracking of profile data combined with the interaction of the consumer with the group (communications, postings, etc) combined with accessing utilities (e.g., widget downloads pertaining to design elements, video home tours, community data, statistics, etc), a firm could create an “engagement” index to validate whether their site is properly satiating consumers’ needs (Circuit City does this). The experience of this for the consumer is not so much having real estate listings and drip marketing pushed her way, but related data presented in a way that allows her to more deeply engage in the process and begin building a community before actually living in a community. Finally, in terms life-time value, this type of a social network could operate as a forum for a firm–and its real estate agents–to cultivate a valid and meaningful long-term relationship with consumers after they have actually bought a home (thus, closing the circle by adding transactional data with previously compiled attitudinal data).

ROI Conversations at Inman Connect

Notes from my presentation on ROI at the recent Inman Real Estate Connect conference:

Issue: What are the first steps real estate firms should take to get a handle on their data to enhance near-term and long-term ROI on this data?

  1. Since 80%+ of all originating real estate transactions begin on the Internet, firms should consider utilizing proven Internet analytics engines;
  2. Firms should create an existing consumer data warehouse that accepts data from whatever format and whatever source, normalizes this data, hygiene this data, to net down to a single record per consumer data set;
  3. Firms then should segment this data, overlay this data (e.g., with demographic or lifestage data), score and profile this data, and then model this data; this gives firms insight into their existing consumer data;
  4. This data warehouse then is used to drive marketing decisions pertaining to existing and emerging or new consumers.

VisiStat is a program to understand broad as well as locally-specific Internet use traffic that real estate firms can employ to make more informed decisions about how to manage their Internet resources, agent base, franchise locations, etc. The same can be said for Google Analytics, HitWise, etc.

But if we’re really focused on ROI, the key is consumer-specific data and the analysis of such. Accordingly, if one only looks at Internet based, or Internet derived traffic, it’s largely like looking at the top crust of an apple pie…the filling is where the substance is. And in the case of ROI that substance is a carefully constructed marketing database and marketing data warehouse where each consumer data record has been individually segmented, scored, and overlaid with demographic, psychographic, and lifestage data.