Referral Marketing.. Who knew?

Well, it's been some time since my last post; more than a year, in fact. It's been a busy year.

Life as I knew it was turned upside down when I made the switch from a SaaS provider in the residential development industry to a niche-marketing agency that specialized in referral & loyalty marketing solutions. Developing domain expertise takes time, so moving to a completely new sector was an overwhelming thought at the time I made the switch. I had spent the better part of four years in the development industry; I knew every company and key influencer across Canada, and most of them knew me. I valued my time there immensely and truthfully, part of me didn't want to leave it. But sometimes you have to make hard decisions largely based on your instincts, and one year in I'm more confident than ever I made the right choice.

Referrals and recommendations; these are words that every business understands. Every company in the world depend on referrals, testimonials and personal recommendations for credibility and to establish brand value. Because of this importance, company's started to create structured initiatives to track and reward these important behaviors, very similar to the way loyalty programs are structured. Enter RewardStream.

RewardStream started out as a loyalty software provider in 1999, creating one of the most powerful loyalty solutions in the world that was used by companies like Sisco and Nestle. In 2003, RewardStream designed their first referral marketing software for AT&T; the rest as they say, is history. RewardStream's proprietary software and agency services are now used by some of the worlds largest brands including Royal Bank, AT&T, Sprint, Virgin Mobile, Nestle and WWE (yes, that WWE, formally the WWF). Referral marketing initiatives are taking off in almost every conceivable sector, as brands insensitive their existing customer base to grow the business.

Over the past year I've worked with Nestle, RBC and countless others developing referral marketing strategies and watching the initiatives launch and grow into new, sustainable and high-growth customer acquisition channels. The gratification I feel in my role as Senior Director of Sales & Marketing is like nothing else I've felt in my professional life. I am humbled to play a role in this play.

So, there it is. This update has been a year in the making, and although I doubt anyone was waiting for it, I feel a sense of relief writing it. I suspect this blog and website will play a much larger role moving forward, so check in once and a while and don't hesitate to reach out and say hello.

What Makes For a Great Builder?

Purchasing a new home is likely the largest investment many of us will ever make, with long-lasting implications. The building process is a balancing act – coordinating dozens of trades, suppliers and the installation of hundreds of individual components all working together to form the ecosystem that makes up a new home. Choosing the right builder is not something that should be taken lightly, as who builds your home will have a material impact on your ownership experience.

If you’re lucky, you have a family member or trusted friend who has had a positive experience with a builder who also happens to be building in the area you wish you to live. If not, conducting your own research will have to suffice - but what should you be looking for? 

Bob Finnigan, COO of Housing at Heathwood Homes suggests the different between an average builder and a great builder comes down to attitude and the way they view their customers. “A great builder realizes that a happy customer is your absolute best sales tool. Regardless of the type of home they purchase, you must strive to meet or exceed the homeowner’s expectations.”  For example, Heathwood Homes does an inspection of the home prior to the homeowner walkthrough. “We ensure every possible effort has been made for the home to be as close to perfect as we can reasonably achieve, before the homeowner even sees it.”

That is great advice, but how does one research attitude? Start with the visible attributes that reflect attitude. A referral program indicates the builder relies on word of mouth as part of their sales process, which is generally the most important aspect of their business. A strong social media presence indicates a forward-thinking company that thrives on interacting with their customers in a public forum. Industry awards, particularly those that measure customer satisfaction are a strong sign of an organization that prioritizes their homeowner’s buying experience. Lastly, a builder who highlights their customer service standards is holding themselves to a higher benchmark than those who don’t. All of these initiatives are customer-focused and can paint a clear picture of how an organization treat their customers.

 “It’s a simple premise, but if you design your sales, marketing, construction and service programs around keeping the homeowner informed and educated, you set a clear expectation that you must execute to satisfy the homeowner,” says Finnigan. “In the end, it comes down to transparency.”

New Homes Need TLC Too

With brand-new products installed in the home and a good warranty to protect you, owning a new home is as close to hassle free living as you can get. But generally lost in the buzz of buying new construction is the thought of keeping it in “like new” condition. Understanding how to operate, maintain and service your home and the components within is critical in ensuring you don’t violate the terms of your new home warranty, retain your home’s resale value, and keep the cost of ownership low.

Ontario law requires builders and developers to provide a new home warranty through TARION Warranty Corporation. This warranty is designed to ensure your home was built to code and protects you within a defined period of time from any issues that may arise. The warranty is, however, conditional on an owner operating and maintaining the home as instructed by the builder and product manufacturers. Because understanding how and when to do the work is essential to successful homeownership, by law you will receive a maintenance guide from your builder. Additionally, your builder’s homeowner manual should contain all of the installed products manufacturer’s documents for your home. It is a good idea to request a sample homeowner manual from your potential builder prior to purchasing and get it in writing that it will be provided.

Like selling a car, the condition and service history of your home has a material impact on the asking price, and unlike factors such as market conditions or interest rates, you have complete control over this. Take advantage of the new technology tools that have been introduced in recent years that help you track the upkeep of your home. Many new homes now come standard with a web-based portal that stores all of your home’s product information and care instructions, while tracking your ongoing maintenance. Never lost or misplaced, this digital home resource is fully transferable if you decide to sell. 

When you own your home, it is impossible not to incur costs over time. However, extending the life of big ticket items such as appliances, flooring and countertops can save you money and delay the need for large scale renovations. Smaller maintenance tasks like replacing the caulking around windows and doors will keep your energy costs low. It is important to remember that most components in your home have the ability to affect other products or even the building structure if they malfunction, making even the smallest maintenance task important.

The experience you have when buying new construction depends on your understanding of the process; from your contract to purchase and all the way through the first ten years of ownership. Expecting to put as much “TLC” into your new home as needed will ensure you get the most out of your buying experience.

Use a Specialized Realtor When Buying New Construction

Buying new construction is very different from buying resale, and it’s easy to get caught up in the excitement when visiting the Presentation Centre of a new development. To save time, energy and most importantly, money, use the services of a realtor specializing in new construction. You have nothing to lose, and a whole lot to gain.

Like choosing a builder, choosing a realtor is not something that should be taken lightly. Expertise and some good advice will save you a lot of headaches and potentially a few costly surprises down the road. Start with recommendations from friends and family who have had experience with buying new construction, as they likely would have dealt with a realtor in the process. If you don’t have any personal referrals, try using free internet resources such as SundayBell (www.sundaybell.com) which allows you to search for agents who have specific areas of expertise and ask questions anonymously. This comparison will allow you to choose the best agent for your needs in a “no pressure” environment.

After you have selected a qualified realtor, narrow down your desired location and the various communities or projects being built. Your realtor will have insight into any new projects being planned for that area. “If you’re looking for condos, keep in mind that developers must sell a percentage of the units before they can get financed to start construction,” says Andrew La Fleur, a Toronto based Realtor. “This can mean early purchase pricing and other incentives prior to the official launch.”

The single biggest disadvantage you will likely experience when buying new construction is buying a contract as opposed to a complete structure. “Pre-construction contracts can be tricky, and you need to ensure everything discussed with the sales people is written into your contract prior to signing,” says La Fleur. “Things like actual ceiling height and finishes detailed  in your contract versus what is in the show suite are common points of contention, but those are relatively minor compared to undefined closing costs and restrictions on future assignment rights.” Having clarity in regards to your contract will have a direct impact on your buying experience.  An experienced realtor will negotiate for you and ensure there are no surprises when it is time to take possession of your new home. 

Just like buying a resale home, the realtor’s commission is paid by the seller, so there is literally nothing to lose from having a realtor work on your behalf. Keep in mind that the staff you speak with in the Presentation Center are paid by and represent the builder, so having a realtor working for you ensures your best interests are being looked after.

New Vs. Used Real Estate - What side are you On?

This article first appeared in the Toronto Sun - Homes Extra on June 8, 2012.

With talk of housing starts, particularly condominiums, dominating in the media lately, it seems as if new home construction is getting a lot more attention than it once did – and not always positive. If you are in the market for a home, the choice will soon be upon you; new or used? Don’t let the hysteria that surrounds the real estate industry cloud your judgement; consider all the factors before making a decision. There is no right or wrong answer, only what is right or wrong for you.  

Few, if any, purchases in life have a greater emotional and financial impact than buying real estate. You can reduce the emotional distractions by forcing yourself to write out a list of what you feel are the most important features.   Ask yourself, “What matters the most?” Is a third bedroom more important than an updated kitchen and bathrooms? Is the peace of mind that comes with a warranty more important than an older home with a lower price tag but more maintenance? What is your long term plan for the property? If it is destined to be an income property, perhaps an older home with dated finishes and a lower price tag would produce a higher ROI. If possible, try to align your current needs with your 5 and 10 year plans. That may be difficult, but it is well worth it.

A new home is more than just updated features; it comes with the peace of mind of a warranty, strict building code standards, lower operating costs and a certain level of customization in terms of upgrades and color schemes. However, unlike a resale home you may not have the instant gratification of an immediate possession date. Depending on whether you’re buying a condo, town home or single family dwelling, you could be waiting anywhere from a few weeks to a few years to take possession. Consider construction timelines very carefully, as they can be impacted by a variety of factors such as market conditions, permits and licensing, and even the weather.

Two people of similar backgrounds and demographic can look at the same property in completely different ways.  Let me give you an example.   I prefer sleek & modern, and I knew from the moment I started saving for the down payment that I would be buying new. I’m your typical “Gen Y” buyer; I want the latest and greatest, I want it done for me, and I want it now. A very good friend of mine who purchased a home at the same time had a different perspective. He put a premium on space, and gladly sacrificed the latest design and decor in exchange for the higher square footage that a 25 year old home afforded. In the end, we both obtained exactly what we wanted. 

There are many things to consider when buying a home, and chances are the top two on that list will be location and price. Beyond that, factors that will impact your decision are abundant. Resale value, rental income potential, ongoing maintenance costs, design preferences, peace of mind - I could go on but I think you get the point.  Which option will result in the best combination of what you want now, and in the future? Once you have the answer to that question, you will know what side of the fence you are on.

Real Estate Bubble? Here’s Why I’m not Concerned

This article first appeared in the Toronto Sun Homes-Extra section, issue May 18-20.

Search “Canadian Housing Market” on the internet and you will surely encounter dozens of articles from all kinds of industry experts giving their opinion on this fiercely contested subject. You will find, as I have, that there is a commonality in these articles; they are consistently inconsistent. 

You will find the heads of major banks, economists and politicians all making conflicting points about current market conditions. You will read that we are in the midst of a real estate “bubble”, or that the market is stable, and everything in between. You will read immigration statistics, unemployment figures, interest rate trends & predictions, and of course, the dreaded debt-to-income ratio. The same statistics will be used to make completely different points and after a while, you may come to the same conclusion I have: it is all irrelevant.

As a homeowner, all of this information is applicable to me and is concerning.  It is concerning now, just as it was 24 months ago when I purchased a pre-construction condo.  And, the same concerns were there for my parents 15 years ago when they purchased their first home. But like my parents before me, I did not get caught up in the hype and hysteria that is often associated with the subject of real estate. It was difficult, mind you, especially when buying a home within a building that hadn’t even started construction. Worrying about market conditions as they stand today is difficult enough, worrying about what they may be like in two years is enough to drive you crazy. But the experience taught me an important lesson; understand the market conditions, but worry about the things I can control.

Here is what I knew then: I will always need a place to live, real estate prices fluctuate, interest rates go up and down and the sun will rise tomorrow (probably). These are indisputable facts, the “rules” of the game if you will. They gave me the context needed to make a buying decision that was right for me.

Here is what I could control: I knew I wanted to buy new, which meant pre-construction. That afforded me the luxury of being able to select a builder, so I settled on a great local developer with a proven track record of successful projects and a reputation for customer care. I couldn’t know for sure if house prices would go up and down in the two years it would take for my condo to complete, but I did know that the purchase price was well within what I could afford. Interest rates were the biggest variable, so I made sure I could afford my mortgage at the 25-year average rate (about 6.25%). With confidence in both my job stability & potential career growth, I was ready to buy.

Two years after buying, I couldn’t be happier with my decision. My developer of choice lived up to my expectations, my interest rate is considerably lower than what I budgeted for and most importantly, I am ready for the market fluctuations that may or may not be in our immediate future. Of course with any investment, there will always be risk. Understanding that risk allows you to make a smart investment, which will help insulate you from the market conditions that you cannot control.

“Social Media” Should be Considered A Swear Word

ou’re probably thinking, “What an odd title coming from a company that is in the business of social media.” But how many times a day do you hear the term, “social media?” I’m guessing a couple dozen, if not more. For us, who work in the online marketing space, it is easily 200+. The repetition of the phrase is not the problem. It’s the hype, stigma and emotional response evoked when hearing the term that we have a problem with.

From Facebook’s IPO, to every brand in the world wanting to connect with you via Twitter, Blog, Pinterest, Facebook or Instragram (the list is considerably longer), you can’t get away from the far reaching social media monster. Lost in this hype, we’ve found, is the fundamental reason why almost 1 billion people are on Facebook; to connect.

At some point, connecting meant a $ sign. There are actually statistics out there which calculate how much each Facebook user is worth in advertising dollars, based on variables such as age, sex and location (I’m worth about $9 annually, so forgive me for my bitterness). I remember back in 2006 when I first signed up for Facebook and there were no ads, very few brands; it was generally “clean.” I can’t say the same anymore.

This convoluted mess has become mainstream and businesses have jumped on board. They know traditional marketing & advertising has become far less effective, there is simply too much of it. Social Media allows for them to expose their brand to us within our inner circles, where we spend unguarded time and open ourselves up to sharing. Sneaky eh?

That’s why I say, no more “social media.” Your online strategy should be focused on connecting, communicating and at the risk of sounding lame, being a good friend. Offering advice, giving and listening should be your only purpose when operating on social forums.

As online marketing becomes the norm, eventually we will start tuning it out much like we do billboards, TV commercials and newspaper ads. I would argue most of us already do, making the subtle but significant switch even more important. If you own a brand, connect with your customers & target market the way they connect with their friends; honestly.