Technology is just a tool. In terms of getting the kids working together and motivating them, the teacher is the most important. (Bill Gates)
Claire Middleton argues that despite the technological takeover, humans are still key
THERE’S a feeling that the business of property has lagged behind business in general when it comes to embracing new technology. However, the consensus also appears to suggest all that is changing and proptech, a term which seems to cover everything from apps to Zoopla, is the industry buzzword for 2018.
Now, as someone who has watched almost two decades of Grand Designs, I’m not convinced those working in the property sector have been lacking innovation all that time.
After all, for every homebuilder who slapped horsehair in their plaster or built their walls with old tyres stuffed with mud, there were those who embraced the latest trends in polystyrene blockwork, triple glazing and recycled insulation.
Of course, the world is going bonkers courtesy of disrupters who are challenging lots of preconceptions in business – Uber and Airbnb obviously spring to mind – and there is no reason the property sector should be immune to all this.
Online estate agents have been with us a while, enabling us to filter our choices – three bedrooms, two bathrooms, good schools, low crime and a sunny aspect please – and apparently the human who would currently get the keys and show us around the property will soon be replaced by a robot with an iPad. Drones give us 360-degree aerial views of our potential purchase and smart appliances allow us to control heat, light, washing machines and fridges from our mobile phones.
In the commercial sector, the money is bigger and the disruption suitably amplified. Crypto currencies and blockchain technologies allow for global transactions which do away with third parties, and property developers will be looking nervously at Facebook, which is designing and building a 1500-home “company town” to support its headquarters in Menlo Park, California.
Constructing homes for employees is not new – the rows of terraces in towns across the UK were built to house miners, mill workers and shipbuilders when the industrial age transformed Victorian Britain. Yet there is no doubt that an industry which has remained relatively traditional in its approach is changing exponentially.
However, although we are in a world where technology has the power to transform our relationships, we are also operating at a time where there is a premium to be had on excellent customer service.
So, can the robot trump the human when it comes to providing the best experience for our clients?
Research carried out by Dr Danielle Sanderson at the School of Real Estate at Henley Business School suggests the human still holds the aces – and the keys to the bottom line.
“Surprisingly, ‘soft’ skills like empathy, understanding and trustworthiness were found to be more important to occupiers than the ‘hard’ financials,” said Sanderson who analysed more than 4,400 interviews conducted by customer experience consultancy RealService.
The company quizzed occupiers of shopping centres, retail parks, multi-tenanted office buildings, business parks and industrial estates over a 12-year period and Sanderson used the RealService data to compare the financial performance of 274 of these assets with their peers.
Crucially, she found that where customer satisfaction increased, so did financial returns.
She said: “The most significant finding was that a rise in occupier satisfaction by one level (on a five-point scale) will typically improve total returns by 1.9% a year,” she said. “It shows that there is a clear customer experience gap to be closed and the commercial imperative to do it.”
At a time when the world economy mixes competition and chaos – think Trump, Brexit, trade wars – any means of improving performance in the three R’s of real estate (revenue, retention and reputation) would seem to be a good thing.
Howard Morgan, the founder and managing director of RealService, believes the property industry has room for both humans and machines.
“There’s a great coffee shop on the platform at Pinner Station,” he said, “where you can get a great coffee from someone with a smiling face who knows your name and how you like your drink. Transport for London could easily have put in a machine, but you would not get that service, that powerful personal connection.
“Machines can do the job but they cannot replace the power of personal contact.”
Indeed, when Morgan’s company has undertaken research into post-occupancy feedback, key areas of either satisfaction or concern have often been around communication, responsiveness and the understanding of business needs; basically, the human areas of the process.
His passion for the customer experience has enabled RealService to persuade major players in the property sector to aspire to providing the sort of customer service we expect from the hospitality or travel industries. Like Sanderson, his argument is that, in a competitive business environment, it makes economic sense.
So, while proptech is has the potential to cause massive disruption to this huge sector of the global economy, there are surely still key roles for the human protagonists involved in the processes of building, buying, selling, renting and occupying. After all, we still need to be persuaded, convinced, cajoled, reassured, advised and applauded.
Those vital customer connections are the ones which transform a transaction into an experience and have the power to benefit the bottom line.
And, so far, the robots can’t do that.
This article is written by Claire Middleton, Senior Consultant, Real Service.