“NEVER GIVE UP, NEVER SURRENDER” – A NECESSARY CREDO FOR NEW HOME SALES

I stopped by Walgreens with my wife this morning on our way home from breakfast as she needed hairspray. Upon entering the store I noticed a sign for cartons of Coke which advertised a sale @ 3 for $12.00 + a $5.00 coupon for my next purchase. But when I took my items to the register the clerk rang the coke up at $13.00. When I mentioned that there was an error in the pricing, the clerk’s response was “No, the price is $13.00.”

Having a low tolerance for both rudeness and stupidity, I walked over to the coke display, removed the sign which clearly stated that the price was $12.00 and handed it to the clerk. Instead of apologizing for her error she responded, “Why did you bring me the sign?” I then lost my patience and launched a monologue about both courtesy and the proper response to a customer explaining that her initial response should have been, “I am sorry but my register indicated the price was $13.00. If you would direct me to the sign I would be happy to check that for you and correct the overcharge.”

I am certain that my diatribe had little effect but nevertheless I will continue to try and educate the world on the correct way to deal with a customer. And that brings us to the topic of today’s blog.

It is tough out there today in the homebuilding business and especially tough in new home sales. With the tax credit now ended and new job formation proceeding at a snail’s pace, it is likely to remain tough for some time to come. We have to fight for every sale and that means that we can “never give up, never surrender”. We must intelligently, professionally and creatively work every visitor to create a prospect and then work every prospect to become a purchaser, continuing our efforts until that prospect “buys or dies”.

To achieve that goal we need to have trained salespeople who are experts in our community, our location, our homes and our company and the USP that we provide. Our sales staffs need to be trained in proper sales methodology and technique, how to create personal relationships with prospects and assist in creating purchaser motivation. And homebuilders and developers need to provide the supportive environments that will assist their sales staffs in those efforts.

Ross Robbins wrote an excellent article earlier this year for Sales and Marketing Ideas, the bi-monthly magazine of the National Sales and Marketing Council, in which he suggested that in the past it was the responsibility of each sales professional to invest his or her own time and money to improve sales skills, specifically the investment necessary to earn the CSP, MCSP, CMP and IRM designations. During the boom years that our industry recently enjoyed, many homebuilders and developers typically paid for this education but now that the markets have softened and builder profits are scarce, Ross suggested that the sales people should once again make the commitment to invest in themselves.

I do not disagree with Ross but I also believe that it is to the benefit of every builder and developer to make every sale possible and to do that we need to have the best trained sales staffs possible. With our sales people currently suffering the same economic challenges facing the builders and developers, I would offer for consideration the premise that perhaps it makes good business sense to have a partnership between the builders and developers and their sales people where they all invest in and contribute toward the common goal of increasing professionalism to sell more homes. But regardless of who pays for the sales training, one absolute responsibility of every homebuilder and residential developer is to provide the supportive working environment that will nurture the sales people and help to stimulate their maximum performance.

Eighteen months ago I was retained to evaluate a community that had been open for one year; fifty-seven homes were up or under construction and not one single sale had been made. In addition to fundamental errors in sales and marketing, my analysis indicated that this community had the wrong product and was priced incorrectly. My recommendations for necessary corrections were apparently painful to the builder’s ego and were implemented only after the lender issued an ultimatum. But even in this seriously challenged new home marketplace, with realistic pricing, a properly trained sales team and correct marketing, twenty-seven sales were made in the next year. Actually, thirty-two sales were made but the appraisals did not support the sales prices and the homebuilder refused to further adjust pricing or negotiate.

Apparently the builder’s ego combined with other personal issues made it impossible to face reality altogether. After the first five sales were made, during which the builder constantly berated the sales manager for failing to convince the market of the “true” value of the homes and community, the builder attempted to increase prices. Instead, as the housing market continued to deteriorate, the next five sales were at slightly lower prices than the first five and were accepted by the lender over the builder’s objections and after further abuse of the sales team by the builder. In fact, every one of the twenty-seven sales occurred only because the lender demanded that they be accepted and the builder demeaned and abused the sales staff every time.

I was retained as a consultant to this community by the lender for an initial one year term. Primarily due to the builder’s attitude and inability to function intelligently and professionally, I declined the offered renewal of my contract. The sales staff resigned three days after I departed and the builder replaced them with a “friend”. I happened to be in that market a few weeks ago and checked to see what was happening with this community and discovered that zero sales had been made in the last six months and the builder was now “vacationing” in a substance abuse program.

The title quote comes from Galaxy Quest, a 1999 comedy science fiction film starring Tim Allen, Sigourney Weaver, Alan Rickman and Tony Shalhoub, The movie is a parody inspired by the television series Star Trek and is quite enjoyable; it won the 2000 Hugo Award for Best Dramatic Presentation. Perhaps it was karma, poetic justice or just coincidence that the other notable quote from this movie, “By Grabthar’s hammer, by the Sons of Warvan, you shall be avenged”, appears to have been appropriate for this situation but that’s just my opinion.

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6 thoughts on ““NEVER GIVE UP, NEVER SURRENDER” – A NECESSARY CREDO FOR NEW HOME SALES

  1. Dan – I save most blogs I read until late in the evening or early in the morning; yours I read as soon as I see them.

    Obviously, egos can be expensive to maintain. It seems, though, that salespeople must have egos, too. Otherwise, more would be responding to the advice that you and Ross have given to edify themselves with more, current sales training. Sure, it would be great if every builder understood the benefit of having a well-trained sales force capable of producing in tough markets. However, as a salesperson myself, I understand that whatever I might have to sacrifice to invest in my own learning will pay the highest of dividends.

    Here’s to the salespeople that take the initiative to learn, change and grow. They will soon be the leaders in our industry.

  2. Knowing Dan as I do, I can actually picture the exact exchange between the clerk and him regarding the Coke price, and as I see the picture in my mind’s eye, I get a fine chuckle.

    I, too, often notice the lack of training in customer service as I travel or conduct routine business in my home town. And I certainly notice the lack of training within the new home sales offices where the sales teams have little or no good responses to the baggage and beliefs with which their prospects arrive. This brings me to my specific point.

    I absolutely agree with Dan that it is in the best interest of EVERY home builder to invest in training their sales team. I believe the builder pays less for training than on the price concessions on every sale by an untrained team. My article was never intended to suggest otherwise. It was my attempt to articulate why it is worth it for one who intends to be a professional sales person in this industry to invest in themselves when their builder will not. Since many builders today have almost no margin in the homes they build unless they have been able to write down their land cost, perhaps they can work with the sales person to reimburse part of the cost of training as their margins grow from the improved sales skills their team acquires. Either way, training tends to be most critical when sales are scarce and money is tight. That is when a pro digs deep to get the edge on the ones who wait for someone else to pay for training.

    The bottom line is still this: If you think training is expensive, you should see the true cost of ignorance.

    Thanks for another great read, Dan.

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  4. Excellent post Dan. Results come from a combination of:
    (1) People (with skills & training),
    (2) Process (effective follow up & nurturing), and (3) Technology (that supports # 1 and 2).

    And yes — a healthy dose of reality.

    Best regards, Dave.

  5. Excellent blog, Daniel
    I am a firm believer in training and every chance I get to take a class I take it. I pay for my training because I want to learn everything that I can about home building, new home sales, answering objectives, the critical sales path, etc. so I can be prepared to handle whatever situation I am faced with while I am working.
    New Home Sales people that are not trained on a regular basis are missing out on the growth and success that training provides.
    I agree with you, Daniel that we should “never give up and never surrender”, but learn, learn , learn every chance we get so we are prepared for success at all times.
    Thank you for your knowledge and expertise.
    It’s a pleasure to know you.
    Regards,
    Del Barbray

  6. The client is not always right but the client is always the client… It is about how you handle a situation and here the employer certainly failed.
    The employers have to spend time training, coaching and checking on how their staff performs, it only takes one bad interaction to ruin an experience.

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