47 | Leads, Price Increases, and Delays

Show Notes:

Focus Discussion of the Week:

The pendulum has swung quickly from utter fear and uncertainty to we can’t build enough new homes quick enough. With record breaking low interest rates, suppressed inventory levels, and consumers who NEED change in the way they live their lives, homebuilders are well positioned. Maybe…Lots of recent conversations around price increases, delays, and too many leads, and how to handle them all is the topic of this week’s episode.

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Two thought leaders come together to explore all things sales and marketing from their unique perspectives. Each week, Mollie Elkman, Matt Riley, and others from Group Two dive into a focus discussion to talk about the latest trends, changes, and best practices.

[00:00:00] Mollie: All leads, as we know, are not created equal. So the more you can qualify up front, that’s going to help make sure that you’re not hurting the customer experience with the people who are actually going to be your customers. So when it feels like it’s too much and you can’t. You can’t juggle it all.

That’s when you end up really under servicing and that ends up becoming your future word of mouth marketing. So it’s not even just that you’re under servicing potentially a buyer right now in this moment. It’s what they’re going to say after the experience of working with you, that ends up becoming your legacy for years.

So that’s why this is. So important because that word of mouth marketing, it needs to be, it continued to be strong even during the busiest time.

[00:01:00] Matt: Hi, and welcome to building perspective with Matt Riley and Mollie Elkman

Mollie: we’re here to bring value to you and your team by exploring all things, sales and marketing related

Matt: all from different perspectives. All right. And welcome to another episode of building perspective. The sometimes weekly, sometimes every other weekly podcast brought to you.

now, so we welcome back Mollie, by the way, Mollie, you’ve been like on permanent vacation,

Mollie: in a cabin in the woods. And it’s, a perfect reflection of some of this stuff we’re going to talk about on his, episode.

[00:02:00] Matt: Absolutely. So guess obviously we are, you know, early on in the COVID pandemic, we were sometimes two or three times a week.

Right. And because there was a lot of information, we were trying to get disseminate that out to everyone. And now we’re in a different scenario, right? We’re in a scenario where most everyone is selling houses like crazy. You know, most everyone has incredibly low inventory and we want to make sure that when we bring a topic out about, and everybody’s super busy, right.

So, and, and including us, and we want to make sure that we. Come on, especially kind of during these times that we’re in, we’re bringing relevant messages. So that’s one of the reasons why we’ve actually really spaced out our podcast recordings, because we don’t want to just come in here and talk just for the sake of talking.

Because everyone’s time is valuable, especially right now. So one of the things that it’s coming up a lot and that we’ve been addressing over the past few weeks, [00:03:00] is what are our topic of today is which is leads, price increases, and delays and how we can tackle these and Mollie. You’re not going to kind of run through those three topics in hit.

We’re really between the three, five main. Bullet points of how we can tackle each one of these individual, I guess I’d call them problems. Did you call them a problem,

Mollie: challenges, opportunities

Matt: for sure. And these are all good problems, challenges, and opportunities. and we want to make sure that we’re out in front of it all and tackling it from a best practice.

Now, I do want to say upfront that. There is no, you can’t paint every market, every home building company, every sub market, every subdivision with this broad brush. So if you’re listening to this and. What you’re, what you’re hearing us say is not [00:04:00] exactly what you’re seeing on the ground, in your neighborhood and your communities.

It does not mean everything’s broken, right? That doesn’t mean it’s a failure, right? Because you, it’s not, if you build it, they will come. You still can’t go in a crappy area and overcharge, and still expect people to buy. Or if your product is not right, people still are going to buy it. Even though there is a shortage of homes on the market, right?

So there’s all that stuff that we have to take into consideration. So we’re taking, we’re tackling this from a kind of a bigger picture perspective of some of the things that we are seeing quite often. but if, again, if it’s, does it match your scenario? Exactly. Don’t freak out. Call us and we’ll chat about it.

all right. So with that, like big disclaimer, let’s dive into leads, price increases in delays. Oh, my

awesome. Okay. All right. [00:05:00] So, all right. Mollie leads, too many, right? That’s that’s what we’re tackling from a leads perspective is if you have too many. And so let’s define what Mollie define what is too many.

Mollie: Yeah. I think, I think what happens, like if you feel like you can’t manage, like it’s too much and you, aren’t able to.

Everyone or things like that, then too many feels like too many. It really does. Like, it doesn’t feel manageable than it, then that’s a problem. And what happens is your buyers can feel that as well.

Matt: Yeah, absolutely. So too many. There’s too many. And that’s like defining a word, a word with the word. but, but really, like you said, it is, you know, especially if you have an OSC and they are just not able to follow up with the lead volume that’s [00:06:00] coming in.

And so there’s a couple of things that are at play here and we’ll talk about. Some ways that we can, tackle these and maybe help alleviate and become a little bit more efficient. but a couple of the are two kind of bullets that we’re going to dive into here is when we have too many leads where a wasting marketing dollars and B we’re hurting our customer experience.

And any time we’re spending money that is hurting, the customer experience is wasting money. So, let’s, let’s talk about that for a minute. I was on, I was on a call yesterday and we were going through, like, we have a builder partner that, you know, their business plan is typically, you know, 250 to 300 homes a year, in a, in a good size market.

That’s just what they want to build. they are as of August the 18th, they were at 55 sales for the month. that’s. Double what they want to sell now, Hey, they’re going to shut off [00:07:00] some sales. and, and B, we had to kind of dive in and have one full time. I’m OSC. they’re going to bring in a part time person for help.

but that’s not the it’s going to take some time. That’s going to take, you know, let’s just say 60 days just to get that person even part time up to speed to where they can talk to buyers. And so how do we make it more efficient and how do we know waste dollars? so I’ll, I’ll tackle a couple of things real quick.

and one, one of the things that I said, I thought I would never say was, you know, we need to automate some things. since we don’t have the ability to have another human being on it yet we can automate some things. and then. If that is still the case where we’re still not able to get through them, then we have to look at dialing back, our actual ad spend in places like Google and Facebook.

and, and, and so, yeah, that’s where we’re, that’s where we’re starting. [00:08:00] How do we automate, how do we evaluate what we’re going to automate? So, first and foremost, we know that our website, if someone converts on our actual website, they are. The highest quality from a conversion to appointment lead that we’re going to get.

then, so we want our attention to be able to handle those. Lead inquiry specifically. and so then we look@whataresomeofthesesecondaryleadsourceslikezillowbdxrealtor.com. Those are just three, right? there are, there can be a multitude of other third party sources. those are the ones that are, may be converting a little lower.

And so we have to prioritize those and inside our CRM, We can automate some of these tasks, some of these followup tasks pulling out some of the things that are only can be done manually. Like. phone calls for instance, text messages. it could be a time where you do insert a bot to do some of this for [00:09:00] you from chat and texting platforms, but automation, at least from an email perspective, follow up.

And then the OSC gets triggered when, or tapped when the buyer responds to one of those automated messages. So that’s. That’s one thing. what are Mollie from your perspective? What are some other ways that we can. Help alleviate and be more efficient.

Mollie: Yeah. So all leads, as we know, are not created equal.

So the more you can qualify up front, obviously that’s going to help make sure that you’re not hurting the customer experience with the people who are actually going to be your customers. So when it feels like it’s too much and you can’t. You can’t juggle it all. That’s when you end up really under servicing and that ends up becoming your future word of mouth marketing.

So it’s not even just that you’re under servicing potentially a buyer right now in [00:10:00] this moment. It’s what they’re going to say after the experience of working with you, that ends up becoming your legacy for years. So that’s why this is. So important because that word of mouth marketing, it needs to be continued to be strong even during the busiest time.

Matt: For sure. yes. So another thing, right. So then we were talking about, okay. As we go deeper, you know, is, and this is another thing that I felt, I said, I thought, I’d never say you can scale back some of the calls to action on the web, on our website. If that’s still, if what we talked about still doesn’t get through.

So for instance, you could have, you know, normally on the home page or some like front end pages of the website, you’re going to have your float down with your phone number and your contact form and things like that. Disperse throughout there. You may look at turning that off on certain outside pages until you [00:11:00] get into some of the core pages of like community detail, page, floor plan, detail, page inventory, home detail page, right?

So is your going down the priority list of how to let like lighten the load of leads? If these other things aren’t working, that is something that you can do again.

Mollie: Yeah. So another thing that you could do is instead of, instead of turning them off on the, You know, where they’re not as deep in the site is maybe add some criteria.

Matt: Yeah, absolutely.

Mollie: Or questions so that when someone is registering, you’re not just getting someone who’s putting their name and email. You’re really getting someone who’s actually showing real interest and is willing to give you a little more information because. Those people should be prioritized. Zillow, you know, they said they were have been referring to this as the great reshuffling.

And what that means is people are looking who aren’t necessarily wanting to buy from you, but they [00:12:00] are. Clogging up your system because they are looking and they’re registering on different sites. And so how do we make sure that we are getting the quality leads directly to you without taking, your resources and your time and.

And your money. That’s the big challenge.

Matt: And, and one of the things we’ve always said in the past is we wanna make, it gets so easy on our website for people to submit it, submit their information to us. And I think that’s a great point, Mollie, like adding some criteria and additional one would be more of a dropdown from a timeframe of when are you, you know, are you actively in the market?

And then a timeline of when are you looking to buy? so at least you can sort those inquiries. As needed as they come in and almost assign them a little bit different followup process. And again, what we’re trying to do, lightened the load for the person or people who are handling that lead volume.

Obviously hurting the customer experience or [00:13:00] helping the customer experience are all ancillary effects of doing these things. Right. So leads to many, right? So we’ve got to become more efficient, but we just discuss some of the ways that we can become more efficient if efficiency. Adding adding additional criteria to your forms and even maybe turning off some of the forms on like your homepage or things like that.

So you’re not getting like vendor requests or warranty requests through there. aren’t working then that’s when we start looking at that going back ad spend on digital. So Facebook, Google, things like that, that are easy to turn back on, when the time comes. Alright, so. Those are some quick, just quick go to things you can be looking at and evaluating and do.

Alright, so the next category, we’re gonna try to move quickly. cause I have a call in 20 minutes. price increases. we’re getting them. We’re [00:14:00] getting hammered. Our margins are under attack. Right. And they are coming left and right. I’ve seen people on Facebook saying in our industry saying if I get.

One more phone call about, you know, a price increase or a out of stock on this granite or faucet or whatever. I’m going to lose my mind. We all know the big price increases that we’re taking lumber. I mean, I’ve, we’ve seen, I’ve seen reports as high as a hundred percent increase since like March, February, January.

I mean, it’s. Bananas. there’s all this trades trades on futures. so how do we, we’re going to hit a couple of things here. How do we effectively offset some of this stuff? and then the second part is it’s all about communication. I’m going to tackle how to offset some of this. Mollie’s going to tackle communication.

So. There’s a couple of things that we can do. I’ve seen some [00:15:00] builders ask questions about like, can we put something in our contract that says we can go up in price. If we take a price increase and you’re going to have to pay for the price increase mr. Buyer, I think that’s a bad idea. Then it gives zero urgency of why sign a contract.

and then, so just, I. With a broad brush, I would say that’s probably not a good idea. It’s going to kill any type of urgency. So how do we, how do we protect ourselves? Well, I think we can, one of the things we have to be as really diligent about, how we’re going to structure our price increases. So one of the, one of the easy ways is every certain number of sales.

Let’s just say for this purpose, every two sales, we’re going to go up a thousand dollars in price. Because it’s systematic. It’s not gigantic overnight. And we’re, we’re cooping our, you know, recouping what we’re seeing. Maybe it’s 1500, maybe it’s 2000, maybe it’s 2,500. I don’t know what it is for you. but setting smaller increments, [00:16:00] every couple of sales across the company, not just maybe, maybe it’s by neighborhood.

Maybe it’s across company. You have to look at that, but. But you’re also going to have to put something you’re going to have to communicate that, in to your prospects that are coming in the door that you’re talking to. Because again, you’re going to come back and hurt the customer experience and I’m crossing over into Mollie’s lane.

So Mollie, what do you have for communication?

Mollie: So. As I said earlier, I am literally in a cabin in the woods for our regular listeners. You guys know I was in the heart of center city. I was really, it was overwhelming. we are a perfect example of a family trying to get out of an urban environment. And so we got a second home literally in the woods and

Matt: what we

Mollie: really literally, the day got here, we wanted to order Adirondack chairs and.

Of course, right? You want to sit outside and enjoy being outside. And you’re finally out of the city and all this stuff going on. So we order [00:17:00] Adirondack chairs. We got one email saying your chairs are going to be delayed and they will be there by such and such date. Nothing else. We still have never received them.

There’s been no followup email. There’s been no call. it’s infuriating and the vendor we ordered from we are. So mad. So how do you, or how do we alleviate that? Cause the last thing we want is people to be mad at us and it’s happening across every single industry from Adam chairs to any product and service.

Every single industry has delayed. This is a consequence of what is going on in the world. So what would have made that? Okay. To me, a phone call would have made it okay. Really transparent. communication, such as. We have your order, your order is important to us. There, there is, a delay we’ll [00:18:00] continue to keep in touch with you a sense of empathy and just, you know, we under we’re frustrated too.

We are, you know, we’re experiencing the same thing. So I think, I think over communication is really important, but the tone of that communication is even more important.

Matt: I said also, I just want to say, cause we’re. And it’s okay, but we’re, we’re kind of crossing the price increases and delays part of it really touch each other and right.

And so communicating to your prospects what’s reality and why they need to buy now. and if it is a real sense of urgency and to communicate those aid, those price increases and be upfront delays that we’re going, that we are going to see. when, once we get into the actual build out.

Mollie: Yeah, I did merge them.

I totally did the delays then price increase. Totally go hand in hand. So [00:19:00] communication is, I don’t like to just say, we’re sorry for the inconvenience. We’re sorry for the delay. It’s just not very personal. I think the more empathy you can have, the more, direct contact you can have. that’s why it’s so important that you don’t.

Get consumed with all these leads coming in so that you have the ability to communicate what is going on with your actual buyers that are in your process of buying. So, you know, to me that is less email phone call, keeping the tone in for being informative. In a, in a friendly way that, they get it, your buyer, like, I, I get that the Adirondack chairs are not here.

I get that we are in a pandemic, so it’s not unreasonable that, there’s, you know, something going on there. It’s just, I would have liked to have known. So I’m not sitting here waiting for the delivery truck.

Matt: I had a very similar experience. We bought some [00:20:00] outdoor patio furniture as well from home Depot.

And, you know, it was like, I think it was supposed to have been delivered. It was like four weeks. And it’s supposed to have been delivered on July the seventh. And it was July the seventh came. I hadn’t received a single email about, Hey, your item is shipped. Here’s the tracking number. Here’s the, I mean, nothing.

I had to reach out to them. Dif, you know, and there, I mean, it was, it was a mess, right? Like it’s a 15 minute long conversation, but it was a mess. However, I was okay with the delay fully expecting the delay. Just communicate that to me. Don’t let me be the one to have to reach out to you to check on the status of my order.

And I think for me, like, for me, at least that is. Well, my recommendation when it comes to handling delays, communicate it, communicate it, communicate Kate. You may even want to add a temporary. A temporary [00:21:00] line item in your purchase agreement that talks about delays a spot where they actually have to initial.

And, you know, that says, we are trying to make sure we deliver this home on time, but there are things that are out and we already have most people already have some delayed verbiage in a contract already, but I think making it pause. Spelling out a little bit more in detail, even putting a spot for initials to be on that clause of, on that particular clause of the contract.

So you always have something to refer back to. All right, mr. R R Mollie. I just wanted to let you know, you know, things are moving along. And as when we talked about, when we initially did the agreement per section 12, there are. Extenuating circumstances during COVID with supply chain and there were some delays.

And I just wanted you to know that, you know, the flooring that you ordered is back [00:22:00] ordered, right? It’s two additional weeks. We have a couple of weeks, we have another option that you could come in and select, and we can get that in right away. Or we can obviously wait until your, but yeah. Neat.

Nonetheless, getting out in front of that with your customer.

Mollie: Yeah. And I think, you know, historically in our industry, this kind of delay conversation is like a little more hidden it’s later on in the process. The fact is the consumer is an educated consumer and everyone knows there are delays and, and things going on in every single industry.

So it’s not like I’m saying. Talk about it on the sales floor of like, you know, set your expectations low. We’re not really delivering on

Matt: before you go to contracts, right?

Mollie: That’s not what, what the solution is, but the solution is like a very human interaction of, you know, you are, you are their partner.

And if anything, this is an opportunity to build trust [00:23:00] by being that partner during this time.

Matt: And I think that just being transparent about it and owning it right. And not don’t make the customer feel like you’re just trying to shift the blame. Like you just said, they’re educated. They watch the news, they read articles, they understand they’re experiencing delays like you and I had just talked about on our own personal stuff.

Everybody’s experiencing some delay and I think everyone expects some delay. But I think when you start to get into the customer experience, it’s about the communication and being transparent and upfront, getting out in front of it is what’s going to make it all. Okay. Is there, I mean, is there anything else to add, to delays other than communicating an expectation setting from the very beginning and tackling it along the way?

[00:24:00] Mollie: Yeah, the only other thing I would add is just potentially like additional choices. making sure, like, especially if products, like if a backsplash is no longer going to be available, things like that, you want to make sure that what you’re putting in front of people is going to be available or even.

Get a second choice or just, you know, really talk about it. of course being in touch with your, with your vendors, because there’s nothing worse than picking out your, your dream kitchen. And then all of a sudden it’s like, Oh, that’s not available. That is like a total buzzkill right there. So how do we have, you know, products that are similar that are an additional option?

So that we have them ready to go in our back pocket.

Matt: I think this is also an opportunity. So I’m going to quickly lead into this. I I’m a firm believer that you need to be reaching post contract. You’d be reaching out to everybody in your backlog once a week, giving them [00:25:00] updates along the way. Now with we just talked about leads.

Too many leads that also probably means too many, too many sales. this is an opportunity if you don’t have someone like this already to create like a brand ambassador for your company and ambassador of customer experience or people that are going to take that workload off of the sales team, because the sales team is typically the ones making those calls along the way.

But if you need to pull that off, off the plate of your sales team, having. Some people that are dedicated to that communication and customer experience now is absolutely the time to branch out and test some stuff like that.

Mollie: I love that. I love that idea. I think that’s always a good idea. and yeah, my big concern is that we don’t want, we don’t want you to hurt your.

Reputation for down the road. So, you know, customer [00:26:00] experience, just because you’re busy that doesn’t not get thrown to the side. That is. Just as important as always, that is going to be what, you know, two years from now is, you know, going to determine how you’re doing down the road. So don’t take this time for granted.

don’t, you know, don’t just get lazy with lead management. It’s, it’s extremely important that. We’re setting ourselves up for future success.

Matt: Your buyers are already walking in concerned. They’re concerned about the delays. They’re also concerned about quality because they know that everyone’s sure we’re busy and we’re selling, you’re selling more houses.

It’s just, it’s, it’s crazy town. And so having someone that’s going to help assure them and through communication that things were being done the right way. You know, that can, that can re this is the time to elevate your brand for a long time [00:27:00] out. Right? This is where brand marketing can really come into play, and really give you some longterm, either positive or negative effects that can last the next three to five years.

All right. Anything else to add to that mall? No,

Mollie: I think these are the three hot topics right now. We’ll probably continue to talk about these because this is what’s on everyone’s mind. If anyone has, you know, things that you’re doing that you think are particularly successful, please reach out and share them with us.

We would love to share. And, that’s it. It’s, you know, we’ll, we’ll continue to update everyone.

Matt: That’s right. Awesome guys. Thanks for tuning in for another episode of building perspective and, we hope you have a great week and we’ll chat with you next time. Bye. [00:28:00]

We connect you with buyers.

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