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Customer Satisfaction Surveys Make Good Business Sense

Currently, 25% of the nation’s home builders regularly survey their buyers. These builders have lower sales and marketing costs and fewer warranty callbacks. They get more referrals, too.

Measuring customer satisfaction while juggling everyday tasks can seem daunting, but it is business as usual if you’re focused on constant improvement. “I was hesitant to survey my home buyers at first,” said Rocky Rhodes, president of Acuff-Rhodes Construction in Overland Park, KS. “I figured asking about their satisfaction would bring ‘nitpickers’ out of the woodwork. I’ve learned quite the contrary. It’s given me priceless feedback that is useful in my own improvement.”

Ask the Right Questions

To get the most useful customer feedback, you’ll want to tailor your survey to suit your company and its products and services. Here is some basic information to gather from home owners and prospects:

• Demographic info. If you don’t already have this information in your client records, ask survey participants to supply their age, gender, household makeup, profession, income level, etc.
  
  

• Why did (or didn’t) you buy from our company?

• What do you value most in you new home?

• What can our company do better to improve the home buying and building experience?

• Will you refer our company to others? Why or why not?

Understanding this information is only the first step toward greater profitability. Changing the way you do business is the big step.

Act on the Feedback

If a survey reveals that the only reason why a customer wouldn’t recommend your company to their friends is because the home or project wasn’t finished on time, you can set different expectation levels or create an incentive plan for superintendents and trade contractors to stay on schedule.

Likewise, if you discover your buyers gradually are seeking age-specific features and are moving from a specific area, you can revise your product line, target your marketing and even refine your land acquisition strategy.

Here are some more feedback-driven case scenarios and strategies to fine-tune your business:

• If survey responses show that a portion of your buyers want two master suites instead of one — you could refine your product mix to include a plan that appeals to this market segment. This also will differentiate your company as a leader in customer responsiveness. If you’re building homes in the $300,000 range, just three more contracts a year means nearly $1 million in additional revenue.
  
  
• If you determine that your sales team is spending time on prospects less likely to buy — you could re-direct your marketing campaign to a more appropriate buyer profile. If you saved $25,000 in printing and mailing costs alone you could increase your annual profitability by 3%-4%. That’s money right to your “bottom line.”
  
  
• If your survey reveals that 90% of your respondents were pleased with their building experience and would recommend you to their friends — figure that qualified referrals cost you about $500 apiece in marketing expense and you received 30 leads in a year as a result of your survey. You saved $15,000 in direct expenses. Now let’s assume 20%, or six of those 30 referrals, built a home with you. At $300,000 per home, you just boosted your annual revenue by $1.8 million.

Still not convinced that home owner surveys are worth the investment? Last year your company probably incurred 0.5% in expenses due to human error, jobsite theft, late payment penalties or various otherwise avoidable wastes. If your annual revenues are $5-$7 million, you’re needlessly expending more than $25,000. You could survey your home owners for a fraction of that amount and gain information that could give your business a “shot in the arm.”

Paul Clem is national sales director for Enlight Research, Inc., an Overland, KS-based full-service market research company specializing in Web-based customer satisfaction surveys. For information, e-mail Clem or call him at 913-469-0070 x14.

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