Bottom Line: Relationship management on the lines of service industry can give much-needed facelift to Indian real estate.
â€śWhen I entered the office of this developer I was surprised to note there were no bodyguards and security guards surrounding the office. It was just a pale security guard at the gate which looked quite contrary to the way most of the developers operate nowadays. It has been all the more surprising since this developer operates in slum redevelopment where the use of muscle power is a common reality. And yet the developer operates like any other corporate sector and not a builder. On being probed I found out that the trick lies in his relationship managers who manage the clients in such a professional manner that there is no major confrontation between the builder and the buyer,â€ť Pranay Vakil, Chairman of Praron Consultancy shares his experience.
Investing in relationship management to earn the trust & goodwill of the homebuyers is something that the Indian real estate has not adopted as an industry practice. CRM or Customer Relationship Management is something that every developer today boasts of, but this relationship hardly goes beyond attending phone calls of aggrieved buyers and online registration of grievances.
Whereas the kind of relationship experience that Vakil is sharing is more on the lines of KYC (Know Your Customers) where the relationship managers have all the info about the homebuyers, his grievances, if any, and they are constantly met to update them on the developments with the housing project. This builds a level of trust and good will.
Divya Gehlot, a homebuyer agrees that relationship management of the developer not only breaks the ice but also goes a long way to understand each othersâ€™ point of view, thereby less acrimony. She had a similar experience where after booking the apartment the relationship manager did not forget even wishing her on the birthdays and anniversaries in addition to keep updating on the developments of the project. The dedicated manager was always there when she wished to visit the site.
â€śI was even invited by the relationship manager to show me many options for the tiles of the floor that they are going to use. I had the liberty of choice and since everything was done in a transparent manner I am not complaining now even though the delivery of the project is some eight months delayed. They have explained me the reasons of delay and I feel the reasons are beyond their control,â€ť says Divya.
The question is how many developers are maintaining that kind of relationship management with the homebuyers. Are they even bothered to talk to the customers once the booking is done? As an industry practice today, the only interaction from the developersâ€™ side is when they send the demand note for further payment. In some cases they keep updating over emails but one-on-one relationship management is a critical missing link in Indian real estate.
This raises a fundamental question as to unlike other matured industries why Indian real estate has failed to focus on relationship management with buyers and prospective buyers.
Rattan Hawelia, Chairman of Hawelia Group tries to explain method in the madness when he says that other matured industries which are focusing on relationship management are usually more service oriented whereas real estate has always been addressed as a product based industry. As per the traditional mindset, most of the developers consider that a homebuyer is a one-time consumer because of which they have always failed to explore the benefit of relationship management. Consumer connect is by and large a missing link with direct interface with homebuyers.
â€śI must admit here that the real estate sector has gone overboard on brand campaigns and publicity rather than identifying the gains by connecting with the customer. Exploring this medium by gaining trust and satisfaction of one customer for lifetime will surely open threshold for many satisfied referred clientele and direct boost in sales can be accounted. So far marketing communication has been majorly based on the perception and exposure at the basic level of the first generation business families in Indian realty sector despite the fact that relationship management is a key and effective component to connect with the customers,â€ť says Hawelia.
How far is the perception that the nature of business does not support to have dedicated relationship managers a deterrent? Analysts maintain that due to the demand and supply gap the developers did not took a conscious call to defeat this perception and make efforts for word of mouth publicity through dedicated relationship management with the customers.
Of late, with the advent of second generation and overall changes in the ecosystem there has been sharp contrast in the nature of business. Now some of the developers have started understanding the benefits of relationship managers, and since the first visit of a prospective buyer a single point contact is being appointed who is responsible for all the needs of the buyer from readily sharing the required information & timely responding to their queries to arranging technical support from sales/administration/loan/construction/other department(s).
Such services helps in boosting the confidence of the customer manifolds and also supplements the mindset of Indian consumer who is investing his lifetime savings and hence wants to be treated as a preferred client.
In terms of the cost & benefit analysis of having a dedicated relationship manger for a group of customers, the operating methodology of most of the developers suggest there would not be major cost implications because the business model will remain more or less the same; though certain functional differences would be there in terms of promotion, lead generation and connection with the prospective customers. Such move will create a better understanding between the developer and the prospective customers which will surely help in building goodwill of the company.
The real deterrent is probably the developersâ€™ inability to change with the changing market dynamics where the homebuyers are increasingly getting aware and demanding with their rights.
A dedicated relationship manger for the homebuyers can close doors to the market perception but what makes the developers uncomfortable is the fact that it also closes doors for deliberate delays and cutting corners in construction, as the homebuyers will more or less ask questions on a regular basis. Are the developers open to this customersâ€™ scrutiny? The answer in todayâ€™s context is a clear No.
By: Ravi Sinha