Welcome to the year of customer experience, or CX.
This year has proved to be an interesting one for anyone working (living, and breathing) real estate and property management.
It was the year that saw the fall-and-fall of house prices and interest rates, followed by something of an unexpected recovery and renewed growth. We saw a drop in rental yields in Sydney and Melbourne in March, followed by a small market correction.
We also witnessed the rise and fall of industry disruptor Purple Bricks, and some first-pass experimentation with trust-less accounting systems. We saw the expansion of new revenue streams for property management businesses beyond partnerships with utilities and bond service companies.
And we saw an increasingly laser focus on CX across the board. This particular change can be seen as more mature property management businesses transition from bread and butter property management towards an asset and wealth management services offering for their clients.
But not everyone has had a good year.
But the year hasn’t been kind to everyone. In 2019, digital disruption ceased to be a buzzword and became an established reality for most agencies. Those who have been slow to adapt are now really feeling the pinch of procedural inefficiencies inside the office and increasing expectations from landlords outside the office.
What is becoming clear, overall, is that difficult market conditions, increasing owner demands, and inefficient processes are the stand-out factors that make growth a challenge for agencies of all sizes in 2019. And yet what is also clear is that technology and a CX strategy can do much to help these agencies overcome these difficulties.
If 2018 was the year of the customer, 2019 has been the year of CX. Here’s what else the property management sector learned this year.
Don’t wait for the market to change
As the property management industry transitions to an intensely CX-focused economy, agencies are looking for ways to provide better services for the same commissions.
When they figure out the formula, waiting out difficult market conditions will be impossible for other agencies. There’s still time for agencies to innovate and prepare for the future, but that innovation needs to start in earnest now.
Do an audit of your technology stack
Too many property managers and principals are feeling the sting of an expensive stack of systems and technology that were cobbled together ad hoc as the business grew. Many of those systems that were designed to create incremental property management efficiencies are becoming too complex and manual to integrate with each other. When a user has to create a work-around, it mitigates the benefit of having the technology in the first place.
To find operational and cost efficiencies, and to scale more effectively, agencies could be more strategic and analytical about the systems and software that will get them there. A lean but effective technology stack is the goal. Need help with this? Get in touch with us! We can show you how to effectively audit your systems.
Look for new sources of revenue—including charging owners more one-off fees
The time has come to re-imagine your business as a property services firm that sources revenue from more than just commissions. What else aren’t you charging for? Court fees? Admin fees? Let fees? Advertising fees? The time has come to start charging what you’re worth, and that includes passing on more costs.
Not an option? No problem. There are other ways to grow revenue in property management. From offering Airbnb services to taking on other property-management-adjacent services and partnerships (such as surveying and compliance), the sky really is the limit. Building out a network of these types of relationships with suppliers may take some time in the short run. But property management is a long game. So too then, should your revenue growth strategy.
In 2020, we predict that growing these strategic partnerships and service offerings will become the norm in the property management sector. Add these to your bottom line earlier rather than later, and you’ll be in a much better position to negotiate competitively on things like commissions.
Design a strong CX strategy
As the CX revolution gains momentum, so too will we see an explosion of new options and services that optimise the kind of experience your business can give to clients.
That’s why we predict that nailing CX in 2020 will drive growth and landlord retention. To get a handle on it now, we recommend mapping out a landlord and tenant’s typical journeys to becoming your clients/tenants, and what that experience is like once they're on your books.
Identify strengths and weaknesses in that journey. What do people complain about? What do people rave about? What can be fixed sooner rather than later? Then build out that experience to be as frictionless and emotionally satisfying for your customers as possible.
What does quality CX look like in property management, then?
We see stand-out strategies for success focusing on the following:
- how to overcome internal information silos
- creating a better onboarding journey
- speeding up response times
- creating new value-adding services
- creating better self-service options, and
- freeing up property managers so they have the capacity to meaningfully deliver outstanding customer service.
To do that, agencies may need to become radically more effective at managing information, and at reducing the time it takes to complete all key property management processes in the property management life cycle. That will mean a smarter investment in property management software, and it will also mean making that investment soon, if they haven’t already.
Pick people and tools with a vision for the future
All hail our early adopters and innovators! The pace of change is increasing with each passing day. Those with a vision for the future, as well as those who adapt easily to change are likely to become the most valuable people on your team in 2020. Perhaps the single most important personality trait of new hires now is a willingness to adapt to new technology and be innovative.
This doesn’t have to be a resignation of control or autonomy over our work to the robot overlords. In fact it shouldn’t be. This new age heralds unrivaled opportunities to be more creative, more thoughtful, and more visionary at every rung of the career ladder. The future of work lies in the open plan office more than it does in the boardroom. The future of work, in other words, is more in the hands and imaginations of employees than it has ever been in the history of work.
That’s not to say technology isn’t a critical piece of the puzzle. Technology sits at the intersection of customer experience and customer service, and as such its role will be to support both. As PMs learn how to use technology to ease their mental load and admin burden, so technology will play an increasingly important role in that property management ecosystem.
That’s why we predict that the businesses who truly take growth seriously in the next twelve months will be looking to invest (if they haven’t already) in technology with a clear vision and strategy for the future, rather than tech that promises to do the job adequately and cheaply, for now.
Do less. Make more. Grow more.
Ultimately, 2019 has shown that for those who are willing, technology offers people the chance to radically re-imagine how they do business. For agencies willing to make that shift, 2020 could be their year of doing less admin, making more money, and growing more as a result.
Wondering what to read next? Learn 6 new ways to deliver better CX in property management, or discover how workflows are revolutionising property management.