One of the most interesting things we've done at LPMA is work with companies to mystery shop both their own offices and their competitors.
The best part of the mystery shopping work is that every now and again, we come across a company that’s doing such innovative things that we get excited about the possibilities. These extraordinary companies push forward the rest of the industry – their innovations are set to become tomorrow’s best practice.
Of course, we just as often find companies making basic and common mistakes that fundamentally undermine their business development efforts. Ultimately, the mystery shopping program gives great insights into how business development processes impact the way in which services are perceived and valued by potential investors.
Perfect processes are not mandatory to grow a rent roll aggressively, but these particular pitfalls must be avoided at all costs or any effort will be wasted. On the other hand, working the processes carefully brings a good chance of success. That’s what the science delivers – a chance.
When I think of the lessons learned, I have the mental image of a minefield - there are three common mistakes that companies make and each of those, when tripped, is as devastating to business growth as stepping on a landmine.
Before we do any mystery shopping, we do some desk research on the company. Of course, the first thing we do is Google the company and see what comes up. Since we’ve been running this program, reviews and ratings have clearly impacted the search results and in many ways, this step is fast becoming the most important part of our research.
We review the company’s website and look for some credible statement about why a prospective investor should be receptive to the company. Video is clearly more interesting than photos, while expecting a visitor to download PDF documents is the worst of all. It’s often the case that there are no photos of property managers and it can be hard to find contact details. There is rarely any particular content aimed at potential investor clients and even less frequently, a call to action that drives investor engagement.
We also review the company’s social media profile to get a sense of the public message and just like prospective investors do, we look at the personal profiles of those people who are listed on the company’s website. There are mountains of books and posts and talks on how to do social media well and I won’t make any comment on it other than to say that it’s now certain any company’s future customers are looking the business (and its team) up. If the business owner isn’t thinking about their teams’ and their company’s social profile through that lens, they might want to rethink it - fast.
The biggest mistake many companies make is to use their online presence to only focus on the sales side of the business, in particular the purchaser. Most potential investor clients will look at the website before approaching a company. Almost no inbound business will happen without the person first going through that process. Unfortunately, few companies have thought through how to make their web presence engaging and credibility-building for prospective investors.
The second pitfall arises at the very first phone call from a potential investor. When an investor emails the company or calls the company’s main number and asks to speak to someone about leasing and managing their property, there are two possible options; the call or email can either be sent to a property manager or to a business development team member.
We know from a wide set of experiences that if the inquiry is routed to a property manager, the company has just stepped on the first landmine. Simply put, when the growth and sales process is entrusted to a property manager (who are so busy!), there will always be a lower growth rate than if there is a fully formed business development team.
Another common mistake is failing to properly train the team (and particularly the receptionist) to support the business development effort. This is often a blind spot in any company’s business development efforts. So often in our mystery shopping program, we see the growth process fall over due to the most basic and elementary mistakes in how receptionists perform their work. It’s such an easy thing to overlook, but the receptionist really can make or (especially) break a new business opportunity faster than anyone else in the company.
Shockingly, our mystery shopping data shows that in the vast majority of companies, around one in five inquiries are not responded to at all, usually because a message isn’t taken properly, or actioned in the office. Simple processes and tools in an office can track and manage inquiries effectively, easily eliminating this risk.
The big lesson is that while a company clearly has to have a dedicated growth role or team to really achieve its growth goals, the company also must put in place processes and training to ensure that the new business inquiry makes its way to that team in the most effective way. Failure to do this leaves the company wandering through the growth minefield.
Once a lead has gone from a marketing lead to a sales lead, the company needs to follow up with a call to action. That will typically take the form of a request for a meeting and an email attaching some of the company’s marketing materials.
These emails are generally classified as a marketing effort, but the range of quality we see is vast. It’s nothing short of amazing how many times we receive a short email from the property manager that simply refers to the phone call that was recently completed and has the company’s management agreement attached. These emails often close with a line to the effect of “If you have any questions about it, please call me.” Even if it’s not that bad, the email will typically include a PDF attachment of a generic listing kit that’s bland and essentially unreadable.
Boom! Another landmine is set off.
I’m all for the presumptive close, but realistically, this approach is verging on the ridiculous. Why are we asking if they have questions? Of course they have questions! They have questions and concerns and prior experiences and anxieties and investment priorities – all of which we need to understand if we’re to sell them something of value.
Of course, we also see some examples of excellent marketing. There’s no strict formula for what works and what doesn’t, but the good stuff typically has some things in common.
The first thing that’s striking is when the email is well written, or has clearly been edited with the prior conversation in mind. It will refer to the mystery shopper’s particular issues and priorities and address them credibly. If, for example, the mystery shopper has expressed a concern about the quality of tenants in a prior experience, the business development manager will note that and give some thoughts on how the company could address it.
The email reinforces the company’s stated point of difference and explains how that point of difference is valuable. It’s both personal and professional and gives the company a persona. There’s always a clear call to action for the potential investor that’s appropriate for the circumstances and seeks to build a relationship, not close a sale.
In this first formal point of contact, it’s important to present the company well. In our mystery shopping, we found that an overwhelming majority of emails have typographical and grammatical errors. They make for stark and harsh reading, contain no real marketing material of any note, and don’t build confidence with potential investors.