Bottom Line: Nothing hurts Indian real estate more than their inability to connect with the consumers. Ravi Sinha finds that right from showing approvals at the time of booking to the construction lifecycle, the developers continue to take the homebuyers for granted.
“When a buyer buys a BMW car worth INR 1.5 crore does he ask to meet the owners of BMW? I think the expectation is way too high in real estate purchase,” says a Pune-based developer during an informal chat.
The statement, though in an informal chat, nevertheless shows the callousness of developer community at large towards the homebuyers. It also shows their level of commitment to the desirable element of consumer connect.
Going by the developer’s remark, one wonders whether a real estate purchase can be termed as another expensive purchase. In a BMW purchase, for example, the buyer can look & feel the end product before one takes a final call. But in real estate it is only a promise and the product is yet to be produced.
Moreover, the net-worth of a person buying a car worth INR 1.5 crore is not less than INR 20-25 crore, whereas for a house worth INR 1.5 crore the majority of buyers hardly manage the 20 per cent margin money of INR 30 lakh and the rest is through bank loans.
No wonder, the homebuyers are not impressed with the poor consumer connect of the developers. They are increasingly questioning their callous attitude and their frustration is vented out through protests, social media bashing and court cases.
Relevant questions; unsatisfactory answers
“Even when I buy perishable consumer goods and there is any dissatisfaction I do write to the company and most often they do address my concerns. Why should the benchmark be so very different when making the costliest purchase of my life,” questions Ajay Raj, a Chandigarh-based dissatisfied real estate buyer.
Ajay is not alone to have such a query in mind. The homebuyers across the country are today asking whether there is any element of accountability with the biggest investment of their life in housing. The cynics even have it that the absence of any regulation makes it a sellers’ market with a ‘take it or leave it’ gesture on part of the developers.
Developers, on their part, assure that they have started interacting with the homebuyers and they even address the website visitors and solve their doubts and queries which have started reflecting in their conversion ratio as well. But by and large addressing the consumer touch points is few and far between in the Indian housing market.
More importantly, the consumers are nowadays being pacified due to the fear of consumer backlash than a serious concern to address the grievances and be seen as a responsible and committed real estate brand.
“There is much space left for improvement and innovation to have better connect with the investors and facilitate them with the information they require for their final call. With the e-space platform also, the focus of Indian property market is to tap the NRI customers and other HNIs outside the catchment area or advertised geographical boundaries than to create a dialogue platform for the buyers,” says Devika Menon, a dissatisfied homebuyer in Chennai.
Reality of consumer intelligence
Ignorance of the homebuyers for long has been the bliss of the Indian real estate developers. But the reality is that the informed buyer is today less of a liability than misguided consumer activism, often resorting to the consumer blackmailing in the process.
Consumer intelligence is hence being debated within the built environment of Indian real estate and there is a growing evaluation as to what is the way out in an age of informed buyers.
The developers, on their part, are mostly living in denial that the challenge of meeting up the consumer expectations in the Indian real estate sector is more challenging than in other domains. This is because the sector has been largely unorganised and that all stakeholders do not follow the same ground rules.
In fact, the rules and regulations for the sector have varied from state to state and region to region. As a consequence, transparency in the dealings of many real estate entities has been found wanting. Low transparency has created a trust deficit, with most consumers viewing the sector with a high degree of scepticism.
Abhay Kumar, CMD of Grih Pravesh Buildteck agrees that customer intelligence should be a key component of effective Customer Relationship Management (CRM), and when effectively implemented it can be a rich source of insight into the behaviour and experience of a developer’s customer base.
“We always look at the CRM from the perspective of who all have bought our apartment. And the dynamics are defined by satisfied versus dissatisfied customers. I feel the time has come when initial buyers in the housing project should be made part of decision making; something that will lower the buyers’ grievances as well as generate goodwill leading to referral clients,” says Abhay.
In today’s hyper competitive real estate market, buyers’ viewpoint can no longer be ignored. It is hence a better strategy to make use of the intelligence of the informed buyers, instead of letting the ill-informed and disgruntled buyers making an opinion about the developer in the open marketplace.
Voices getting louder
The property rally and huge demand made the developers complacent and the buyers satisfied with the appreciation. And hence, there were only a minority of the buyers cribbing.
The slowdown made the cribbing buyers grow in number while the developers also realised that consumer connect is not only economical means to communicate but equally beneficial for brand positioning.
Consumer connect is by and large still a missing link with direct interface meaning different things to different set of developers. A sector that has gone overboard on brand campaigns and publicity has not been seen translating that aggression for connecting with the customers to whom they want to convey the message.
Though on the face value they agree that the efficient consumer connect is the best brand positioning yet the scores of consumer cases tell a different story. The disconnect has its genesis with the way the sector has been witness to a horizontal growth where the focus has been more on volume than value.
When the market was at its peak ATL (Above the Line) mediums such as newspaper, radio, television, mobile and digital marketing took precedence while BTL (Below the Line) activities took a back seat.
The slowdown nevertheless made the developers get into a cost & benefit analysis where they realised the importance of connecting with the customer and are laying more emphasis on achieving the same. This has also been a cost effective way of communicating.
Different developers had different ways to connect with the end users. While some of them shifted focus on the third party endorsed PR (Public Relations), there were others who tried to connect directly through various CSR related programmes.
Some of them even had innovative ideas to rope in the buyers as the brand ambassadors. The get-together with the buyers, both purchased and prospective ones, has also emerged as the means of direct interface.
But the question still stands – how far the sector has succeeded in connecting and communicating with the buyers?
The neglected customer
Consumer connect is deliberately neglected by the developers as they have constantly taken homebuyers for a ride
KYC-Know Your Customers is something that builders do not think is necessary in real estate
The nature of real estate business is so opaque that the developers wish to avoid direct interface with the buyers
The government policies do not help the homebuyers to compel developers for transparent flow of information
Real estate is the second largest advertiser after FMCG sector but it is a monologue and not dialogue with buyers
Next: Customer is not the king for builders