Competitive Advantage: Customer Engagement

Homebuilding is a long-term, some say manufacturing business, where scale and success  depends on repeatability and controlling options. In the “pipeline economy,” where value was created by producers (home builders) and transferred to consumers (home buyers), brands and businesses were in control. They built what they built and priced it according to market determined by comparing it to other similar products.

And although some still approach the business that way, today we are living in the “platform economy,” driven by networks and communities where technology connects people, unlocking new sources of value and supply. The classic example is Airbnb, launched in 2008 and with a market cap today of $30.5 billion. They own no hotel rooms, just a very powerful platform that puts travelers in touch with owners of excess inventory. On this platform, the traveler both creates (for Airbnb) and represents (for the owner renting the home) value. All of this is made possible by four global shifts that have dramatically affected the consumer mindset:

  1. Curated product selection
  2. Expectation of personalization
  3. On-demand everything
  4. Time famine

It’s tempting to say that buying a home is different than most other purchases. Certainly, the process of building a home is complex, with multiple layers of dependency—from land availability, deal structures, approvals, segmentation, changing buyer preferences, thousands of parts and pieces that go into the home itself, and the ability of buyers to qualify for financing to actually buy the product. But buyers today approach purchasing a home the same way they do all other purchases, affected by these four shifts. Builders and developers who understand this have a significant competitive advantage over those who don’t.

Simply put by internet entrepreneur and venture capitalist, Joe Kraus, “The 20th century mass production world was about dozens of markets and millions of people. The 21st century is all about millions of markets of dozens of people.”[i]. He’s describing these four shifts in action—customers expect you to be selling the right thing to them, based on what they have told you they want (from the data you have gathered about them), they want what they want when they want it, and they don’t have time or patience to wade through things or information irrelevant to them.

Most large homebuilding companies are not set up to serve millions of markets of dozens, let alone make money doing so. Others are changing their business models, embracing new building technology, evolving product design, and using customer data to drive innovation as well as marketing decisions. And while you iterate or innovate—depending on which end of the spectrum you are on–there are some immediate ways to make the home buyer’s experience of making their biggest purchase ever a better one.

It starts by re-thinking axioms like “experiences are more important than things”, and rather than just accepting that, asking ourselves what things customers hope to get out of these experiences.  Most aren’t just looking for a one and done experience—those are the things that marketing awards are made of. Most customers crave experiences that serve a real function in their lives. Researchers at Northwestern University’s Kellogg School of Business define this as engagement, and they show how it can be used to advantage in any business.[ii]

According to Kellogg’s research, experiences that truly engage and have lasting meaning need to help time-starved customers do 5 things:

  1. Interact – connect with others
  2. Transport – escape or become diverted from the monotony of the day to day
  3. Discover – gain knowledge, insight or a new skill
  4. Identify – affirm or express their identity and sense of belonging
  5. Contribute – give back to society

The home purchase journey often spans months, giving builders and developers multiple opportunities along this path to engage customers in some powerful ways.


How might you invert the way you think about marketing? Can we give up rigid control and stop erecting meaningless barriers that customers get around anyway, and think like a customer, collaborating with external resources and engaging vibrant communities of people? Are there ways you can encourage (not limit) connection between customers and let them share their experiences directly, through direct interaction with neighbors already living in a community, or by throwing a block party before the block is built, encouraging connection and friendship?


Real estate involves selling a dream. How might you demonstrate what life will be like living in your home or community before it’s physically there on the ground to see? New technology is becoming more accessible daily – how can you use it to go beyond the typical AR/VR displays to take people outside their expected experience? In their new Reed’s Crossing community outside Portland, Oregon, developer Newland gives home shoppers the chance to “ride a bike” on a virtual reality tour of their community trail system. Trails will be important to their health-focused buyers in this community just s few miles from Nike’s corporate headquarters.

Virtual Reality Bike Tour of Reed’s Crossing, photo courtesy of Newland


How might you open up your design or building process and give buyers a chance to look beneath the hood, gaining new insights in the process, and building trust as a result? How might you explain what drove the community vision, the decisions you made about where the parks are located, and why the trails connect where they do? This is the stuff that community legends are made of and people take pride and interest in.  


How might you really use the data you collect from customers to show them you see and understand them, not just batch and blast out generic emails about anything and everything you have to sell? As data gets bigger, human experiences matter more than ever. Show them you have a place for them, where they can live their best lives. Do this by asking thoughtful questions that will help you learn about your customers, then use what you learn to communicate with them about what they’ve told you matters most to them.


How might you build ways for your customers to give back to society just by doing business with you? And ways they can talk about it and share it, thus creating a real sense of pride? Many builders assemble their teams each year to participate in the Habitat for Humanity Home Builders Blitz, others contribute time and resources and hold events to raise funds for schools in their neighborhoods. Corporate social responsibility matters more than ever especially to younger buyers, and they want to see your piece of it.

We are living in an era of customer climate control, and these changes are here to stay. While some business models will be harder to change than others, and some corporate infrastructure makes serving these millions of markets a challenge, there’s competitive advantage to be gained in finding ways to create engagement and do things that matter, in every stage of the homebuilding and development business.

Post courtesy of Teri Slavik-Tsuyuki, principal of tst ink, bringing a customer-focused “how might we?” approach to creating communities and brands that connect and engage with how people want to live their lives.

[i] Day, Peter. “Lessons from Silicon Valley.” BBC News, BBC, 23 June 2005,

[ii] “A New Way for Companies to Measure Consumer Engagement.” Kellogg Insight, Northwestern University, 8 June 2017,

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