What I found especially noteworthy and useful as both a sales tool and a strategic marketing element were the following facts:
Although the average price per square foot of new homes has risen from just over $20.00/s.f. in 1974 to a little over $115.00/s.f. as of the end of last year, in inflation adjusted dollars the current cost per square foot is actually less than it was 40 years ago;
The average new home size increased from just over 1,600 square feet in 1974 to slightly over 2,700 square feet at the end of 2014, a gain of more than two-thirds. But as the average household size has declined from just under 3 person in 1974 to approximately 2.5 person in 2014, the average home size on a “per occupant” basis person has increased by 92%;
As new homes have become increasing larger, even at the same effective cost (on a square foot basis), housing affordability has decreased by 50% as incomes have not kept pace with the actual rising prices.
A major challenge for the housing industry if it wishes to continue to grow and prosper is the need to overcome the gap in affordability, especially for the first time buyers. That will necessitate targeting a broader market segment than is currently being served; a market with price sensitivity issues necessitating more cost-effective construction practices combined with smaller home sizes that still provide the essential design, functionality, utility and special features and benefits that today’s knowledgeable and sophisticated home buyers desire. And that would, to a great extent, take us back to where our industry was in the 1960s and 1970s.
I am sure that you have all heard that memorable phrase in one form or another. Although often and sometimes inappropriately utilized, to me it is artistically coined, perfectly succinct, and the embodiment of colloquial Southwest American slang, suggesting the benefits of age and experience. It is far more palatable to me than many others that attempt to convey the same message, such as “don’t teach your grandmother how to suck eggs” which was originally put into print several centuries ago.
Experience is generally agreed to be a good thing as one can usually recognize something that did not work in the past and, hopefully, avoid repeating that same error. In the homebuilding industry, however, it appears to me that often times experience is lacking or, if not the actual experience, then at least the inability to have garnered any knowledge from that experience. Times have changed and we need to change with those times, putting to work what we have learned from our experience. Continue reading →
I had a few spare minutes yesterday before I had to run to catch a plane (on my way home, thankfully) and wanted to jot down something that has been on my mind lately: Why does it appear that some companies have lately forgotten that customers are their most important assets?
As I travel constantly I have developed relationships with frequently used (if not “favorite”) airlines, hotel chains and car rental companies and over the past several years I have probably given each of them tens of thousands of dollars in business. Yet within the past year, and even more visibly within the past few months, I have found that instead of their demonstrating that I am a valued customer they have acted in ways that appear to me to demonstrate a complete lack interest in my business. They have all reduced their benefits yet not reflected those reductions in their pricing, be it something as minor as discontinuing delivery of the morning paper to my hotel room or as major as substantially increasing the number of miles that I need to redeem for a free flight. And in not one instance have I ever received a simple “thank you for my business” unless it was less than sincere “canned” introduction that came as a lead-in within an email or mailing as part of an attempt to sell me their affinity credit card (offers which I seem to receive daily).
The reality is that in all three cases I am a loyal customer and it appears to me that this loyalty is totally unappreciated. Perhaps I am being unfair and these airlines, hotel chains and car rental companies actually realize that the customer is the sole source of their income and should be therefore be nurtured and cherished. But that is not the impression that I, as a customer, have received.
I have read hundreds of sales columns over the years from various authors and sources and one that I remember clearly was titled “8 Times When You Should Thank Your Customers” (my apologies to the author whose name I do not recall). The article suggested that not only should you thank your customers at the obvious times when they do business with you, when they complement you or when they recommend you, but also when they offer suggestions, when they help you to serve them better, and, the one that stood out most in my mind, when they complain to you as they have then given you the opportunity to improve and continue to do business with them.Continue reading →