Millennials Are Rising, Home Builders Need to Follow
The millennial generation, also known as echo boomers and Generation Y, has an estimated 75 to 85 million members and is bound to have as big an impact on the marketplace as their baby boomer parents.
But the millennials have entirely different philosophies, expectations, practices, perceptions and procedures on life in general and, as it relates to the home building business, on purchasing, than any of their predecessors.
Who Are They and What Do They Want?
They are perhaps best identified by their increased use and familiarity with communications, media and digital technologies — e-mail, texting, instant messaging and social media outlets such as YouTube, Facebook, MySpace and Twitter.
But they are far more than just technologically proficient, as noted in studies and documentaries, including the 2000 book by William Strauss and Neil Howe, “Millennials Rising: The Next Great Generation,” and the 2007 television special, “The Millennials Are Coming,” which detailed the significant changes that would be needed in the workplace to accommodate this new generation.
But one study that I find particularly interesting, “Millennial Behaviors & Demographics” by Richard Sweeney of the New Jersey Institute of Technology, while conducted primarily to address this generation’s attitudes and behaviors as they impact education, comes to several conclusions that can have a far-reaching impact on the home building industry.
For instance, Sweeny suggests that:
Millennials have far more choices and are far more selective than previous generations. They expect a much greater variety and array of products and services, yet they are far less brand-sensitive.
They are experiential and exploratory learners. They prefer to learn by doing and seldom read directions.
They expect flexibility and convenience. They want what they want — when and where they are ready.
They expect as much personalization and customization as possible.
They are intolerant of delays and expect their services instantly.
They are the ultimate multi-taskers.
They embrace a “nomadic” style of communication. They communicate more frequently using instant messaging, texting and cell phones from wherever they happen to be at the time.
As a group, they are more direct, confident, outgoing, adaptive, mature and adventuresome than their predecessors. They're also more self-doubting, more open to change and more self-disciplined.
A recent Pew Research Center study on millennials suggests that they are confident, self-expressive, liberal, upbeat and open to change.
Millennials are the most ethnically and racially diverse generation in the nation's history — 18.5% are Hispanic, 14.2% are black, 4.3% are Asian, 3.2% are mixed race or other and 59.8% are white, a record low.
They are the most politically progressive age group in modern history. This generation voted two-to-one for Barack Obama for President while adults ages 30 and over split their votes almost evenly between Obama and Republican candidate John McCain.
They regard activities such as tweeting, texting, social networking and the free, online encyclopedia that anyone can edit, Wikipedia
, as common and integral elements of their lives.
They are the least religiously observant young group since Pew began surveying religious behavior.
To see how cognizant you are of the millennials' attitudes and lifestyle, take Pew’s quick, simple 14-question quiz, “How Millennial Are You?” by clicking here.
I thought that I was fairly “in tune” with millennials, but I only scored 46 out of the potential 100 — probably, in part, because I don’t text.
Our Industry Has Little in Common With These Potential Customers
The fact is many of us in the home building industry — especially principals, department heads, consultants and service professionals — are far older than the millennials and many of us have been slow to embrace the new technologies they so readily use and rely upon.
What’s more, we interpret their texting and multi-tasking as not paying attention. We also are far more conservative and much less ethnically diverse than this generation.
So, unless and until we understand and appreciate who these new buyers are, how they live and, most importantly, how they purchase, we will fail to maximize our sales opportunities and market share.
Builders Can Reach Them by Using Internet-Based Technologies Effectively
From a technology standpoint, builders must start now if they are to tap into the millennial market:
Since millennial purchasers buy individual communities as opposed to a corporate brand, builders need to provide Facebook and Twitter pages for each of their communities and their salespeople need to blog regularly about their community.
Since instant communication is second nature to the millennials, builders should provide Web concierge services in their communities.
Since millennials are online more and more likely to respond to online advertising, builders should continually update their Web sites’ search engine optimization, tracking and visitor analysis so they can optimize the cost and placement of click-throughs, banner ads and other online advertising that they purchase.
Most other Internet-based industries already use these types of services. Since many prospects, not just millennials, visit builder and community Web sites as part of their decision-making process, home building is now an Internet-based industry. So, if we are to reach out and effectively sell to millennials and our other target markets, we need to use these services as well.
But, on an even more basic level, we have to make significant operational changes to better accommodate the millennial market:
Our sales personnel should be ethnically and culturally diverse as well as bi- or multilingual.
We should adjust our sales processes, procedures and presentations to better reflect how the millennials learn about our product and make buying decisions.
We should adjust our sales office hours to accommodate their lifestyle.
Since choices, personalization and customization are important to millennials, we should offer designs and standard and available features that reflect their expectations, even at affordable price points.
We should incorporate valid production processes and schedules — with a timely information flow to these customers — so that all target dates are achieved.
Millennials are expected to buy upwards of 40 million homes in the next several years. Let’s make sure that we do everything possible to sell to this market.
Daniel Levitan, Fellow, MIRM, CMP, CSP, CAASH, RAM, is president of Levitan & Associates, a strategic marketing and development consulting firm based in Ft. Lauderdale, Fla., that serves builders, developers and lender clients throughout the U.S. He is a charter member, past president and Fellow of the Institute of Residential Marketing and past chair of the National Sales & Marketing Council. For more information, e-mail Levitan, visit his Web site at www.levitanassociates.net or visit his blog on residential marketing at www.residentialmarketingblog.com.
‘Social Media for Home Builders’ Available at BuilderBooks.com
“Social Media for Home Builders: It’s Easier Than You Think,” available at BuilderBooks.com, demonstrates the power of social media through case studies and online outlets created specifically for the home building industry.
Learn how to use social media sites to build your brand, engage new and existing consumers, manage your online reputation and sell more homes.
To view or purchase this publication online, click here, or call 800-223-2665.
In Today’s Market, 'Think Sold!' With Help From BuilderBooks
“Think Sold! Creating Home Sales in Any Market,” available at BuilderBooks.com, is a practical, how-to guide for developing the self-awareness, knowledge and skills needed to succeed in the competitive field of new home sales.
The book covers everything from the home buying process and new home financing to strategies for making better sales presentations and sizing up the competition. It teaches readers how to overcome customers’ concerns and provides specific examples of how to explain the benefits of new home features in customer-friendly language.
“Think Sold” provides insights on how to approach sales and life from a position of optimism that will create successful outcomes; how to improve upon potential customer prospecting and follow-up skills; and how to communicate effectively with various types of buyers and learn how to adjust communication strategies to increase rapport and alignment with buyers’ motives.
To view or purchase this publication online, click here, or call 800-223-2665.