Warranty and Homeowner Management: Made Simple

The Ultimate Question and learning from homeowner experiences

The length and complexity of the new-home buying process means there will be several occasions where each home buyer's relationship with the builder will be stressed. New research into the most successful companies shows how soliciting direct feedback often and responding effectively creates authentic relationships with customers.

Identifying, managing and learning from Detractors is discussed in detail in the book The Ultimate Question by Fred Reichheld of Bain & Company.  This book describes how companies such as Enterprise Car Rental have grown into the largest car rental company in the world almost exclusively using referrals. They accomplished this using a simple question and feedback that focuses the company culture on the quality of their customer relationship. View the first chapter of the book.

The Ultimate Question in the context of the home building industry and this book is: “How likely is it that you would recommend your home builder or remodeler to family or friends?”  A home buyers’ response to this question is graded 9 to 0 and segmented: when strongly positive – as a Promoter; neutral - as Passive; and negative – as a Detractor.

Using this simple metric Reichheld describes how companies better manage customer relationships and improve processes that impact their level of satisfaction.  The Net Promoter Score (NPS) is the percentage of promoters minus the percentage of detractors.  He argues convincingly that this measurement may be the one of the best determinants for a company’s future performance.

To monitor the home buyer's experience builders may consider multiple mechanisms to facilitate feedback. Traditional satisfaction surveys alone can be a dissatisfier so Reichheld suggests simple survey methods that enable immediate responses, particularly when customers become Detractors.

For homebuilders this might mean creating more touch points to enable feedback at closing, during move-in, or in the warranty and post-warranty periods. This could be as simple as a "Tell us about your experience" button in an email or on a website that automatically initiate follow up and a rapid response from your customer service team to remedy any problems.

Some marketers claim that The Ultimate Question is oversold, oversimplified and sloppily researched.  However most experts agree that there is much to be gained by implementing the principles set forth in this book.

In today's difficult marketplace capitalizing on referral sales is crucial as the budget strings tighten.  Tracking and managing your Promoters can help you build and increase your referral sales base. But understanding the quality and quantity of Detractors is even more important. And NPS scores may help builders to determine that some housing projects should be terminated. Getting timely and actionable feedback about the home buying experience is crucial to ongoing success.

Spanish language homeowner guide - S & S Homes of the Central Coast

The California Central Valley has a high percentage of Spanish speaking homebuyers that would benefit from a Spanish Homeowner Guide.  But creating and maintaining two sets of homeowner guides for English and Spanish can significantly increase costs. 

But Leslie Rios, Customer Service Manager for S & S Homes of the Central Coast, says the additional cost can be justified by the savings in reduced service calls and improved goodwill among their homeowners and the larger community. 

Another reason a CD-ROM based homeowner guide works well for S & S Homes is that the maintenance and warranty documents also reside on a CD-based program so the cost of keeping inventory of printed manuals in each language can be avoided.  Homebuyers using the program simply choose their language preference and from that point forward they can view, read and print warranty and maintenance instructions in their language of choice.

Leslie ends by stating "I believe that builders should take this into consideration when weighing the language options....I think that offering a cost effective enhancement  could truly benefit for many of them."

E-mail Maintenance Reminders

Homebuilders can reinforce the homeowners maintenance responsibilities by sending scheduled e-mail reminders.  E-mail reminders can be sent based on close date or other triggers specified by the customer.  The subscribers can be the builders list or opt-in using a sign up form.

The newsletter service is enabled by using the builder's subscriber list or homeowners may sign up using the registration ID provided with each CD-ROM, which is linked to a customized or standard sign up page. 

Once a home owner has subscribed to the complimentary news service they will be able to use the newsletter to gain access to an Internet-based version of Home Care Manager.  For home builders and other housing professionals with existing homeowner lists we can subscribe their existing home owner's in bulk. 

Once subscribed home owners will be sent scheduled reminders which provides access to Home Care Manager's: Planning Guide, Maintenance Guide and Log, Preventative Maintenance Tips movies and more.  Newsletters can also be customized based on specific needs and requirements of housing professionals.

The Digital Age Comes Home

Homebuilders are looking for an easier way to give more support to their customers without adding additional costs and/or work for their customer service departments. 

The advantages offered by on-line programs for product warranty and owner maintenance programs are covered in "The Digital Age Comes Home."  This white paper offers insight to residential builders about the use of Internet-based tools to improve customer satisfaction.

A recent study by J.D. Powers highlighted that of the 10 factors driving overall satisfaction with homebuilders, the builder's warranty/customer service ranked highest. Providing buyers with useful home maintenance checklists and time-lines benefits the builder by enabling clear communication about warranty and maintenance. In The News....    Download White Paper......