Study sets benchmarks for customer service
Keller Williams, Prudential top J.D. Power survey
By Matt Carter, Wednesday, August 27, 2008.A first-of-its-kind ranking of customer satisfaction with national real estate brokerages not only gives Keller Williams and Prudential something to crow about, but creates industry benchmarks local brokers can use to distinguish themselves from the competition.
The J.D. Power and Associates 2008 Home Buyer/Seller Study surveyed more than 3,200 people who bought or sold a home between April 2007 and June 2008. Buyers gave Keller Williams the highest overall satisfaction ratings, while Prudential was ranked highest by those who sold a home.
Although the California-based marketing research firm has conducted similar proprietary surveys for brokerages' internal use, this is the firm's first "syndicated" study of customer satisfaction in the real estate industry. J.D. Power funds syndicated studies itself, releasing the results publicly and awarding trophies to top-scoring firms.
The highest-ranked company in each category can enter into a licensing agreement and advertise that fact, said Jim Howland, senior director of J.D. Power's real estate and construction practice. At the local level, brokerages can hire J.D. Power to conduct customer satisfaction research with their clients. If they deliver a high level of satisfaction compared to the benchmarks established in the study, they can earn recognition through J.D. Power's "Agency of Excellence" program, Howland said.
"Because the scores are so close together, I'd say there's a lot of opportunity for companies to differentiate themselves" based on the level of service they provide, Howland said. "If you can provide a quality experience, you have a chance to set yourself apart from the competition."
The national study was confined to large brokerages, because a minimum of 100 consumer evaluations was required to do the statistical regressions analyzing the factors driving customer satisfaction, Howland said. The study included 3,670 evaluations from 3,205 respondents, with some who both bought and sold a home during the study period rating both transactions.
The inaugural study found that it took sellers an average of six months to close a deal, and that 23 percent of sellers had listed their home with another agent before having success with the broker evaluated, Howland said.
On a 1,000-point scale, satisfaction averaged 794 when customers sold their homes in five months or less, but declined to an average of 730 when the process took seven months or longer.
Four factors were considered in overall satisfaction of those selling a home -- agent (43 percent); marketing (38 percent); office (12 percent); and services (7 percent).
Prudential ranked highest among sellers, with a score of 793, performing particularly well in the marketing and office factors, J.D. Power said. Coldwell Banker and RE/MAX followed Prudential in seller rankings, in a tie. GMAC, Century 21, Keller Williams and ERA received lower satisfaction ratings from sellers.
Home buyer satisfaction was determined by three factors: agent (65 percent); office (21 percent); and services (13 percent). Keller Williams had the highest scores among buyers in all three areas, and the top overall satisfaction score (831), followed by Prudential (820) and Coldwell Banker (816). RE/MAX, Century 21, ERA and GMAC finished lower in buyer rankings.
The study also found:
- Some 46 percent of those surveyed said they relied on recommendations from family or friends to find their real estate agent. Approximately 28 percent used the Internet; 23 percent went to an agent they had used previously; and 11 percent used a printed real estate guide.
- On average, home buyers were shown approximately 13 homes before making a purchase.
- Home sellers said their home was shown approximately 11 times, and approximately five open houses were conducted before the sale occurred.
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Submitted by Daniel Rothamel, the Real Estate Zebra on August 27, 2008 - 10:57am.
I'm sure that the brokerages that topped each list are going to eat this one up. At the end of the day, however, I doubt this means a whole lot for consumers.
We're not talking about refrigerators or cars here. 3200 people were surveyed, which means that there were close to 3200 agents used, each of them individual and different from the next, even within the same brokerage. The customer experience at a particular brokerage can vary wildly within a state or even metro area. This is especially true when you have independently owned and operated branches within a brokerage.
My guess is that, in the end, the brokerages will use this as a means of recruiting agents.
http://www.RealEstateZebra.com
Submitted by Jeff Fox on August 27, 2008 - 11:45am.
As an independent Real Estate Company, I think this article is both bogus and a grave disservice to consumers. Because JD Powers had certain criteria (number of consumers polled), independents were completely ignored. It is my belief that independent brokerages give better service overall than do large national firms. If you are going to label someone better you should have criteria which can be broadly used. Now Keller Williams can say that JD Powers rated them #1 in customer service when no one even bothered to ask our clients what they thought. BOGUS B.S. But then again, I expect nothing different from my industry. We seem to put more emphasis on big as opposed to better.
Submitted by Catherine Read on August 27, 2008 - 12:33pm.
I think this is very misleading to the consumer as well and does them a disservice because of all the firms and agents left out. Real estate is local and customer satisfaction is based largely on the individual experience with a single agent in a firm. A consumer would do well to throw this survey in a pile with weather reports and polls for accuracy and importance in choosing a real estate agent.
Catherine S. Read
Creative Read, Inc.
Submitted by Andrew Cooper on August 27, 2008 - 1:02pm.
If you noticed in the article, it states "The highest-ranked company in each category can enter into a licensing agreement and advertise that fact..." It appears likely the reason smaller, independant firms are left out is because should they have been ranked #1, they may not have paid the high "licensing agreement" that drives revenue for JD Powers. By surveying larger, national companies, JD Powers is ensuring their licensing agreement will be paid for.
Submitted by Joanie Miller on August 27, 2008 - 1:21pm.
Notice this is national real estate brokerages as well. I wonder what the results would be on smaller local real estate companies? It would be interesting to know.
Joanie Miller
Miller & Associates Realty, LLC
Panama City Real Estate
Submitted by Susan Krancer on August 27, 2008 - 3:18pm.
Am I the only one that thinks a grade of 80% is nothing to brag about? It's a sad situation when that's the best we can do as a group.
SK
Susan Krancer
REALTOR®
Liz Moore & Associates
Williamsburg, VA 23188
www.WilliamsburgGolfProperties.com
Submitted by Joe Cline on August 27, 2008 - 11:22pm.
I worked for CB in Austin and these JD Power awards seemed pretty weak to me. For instance, when we won the award when I was at CB we were only allowed to use the award in ads for the year we won it. Like no saying that we were 2007 JD Power award winners in 2008. I suppose that means that JD power retains control over its advertising and trademark. On the other hand the JD Power award isn't as weak as our local builder association awards. They have something like 50 awards so every builder in town can claim they are award winners. I had saved a list to post to my blog, but can't find it. Go figure. It looked something like this. Best ranch house from 100k-250k. Then each price range to 3MM. Then best landscaping 100k-----3MM.. etc etc.. I used to think those awards were meaningful, but now that I saw the entire list of awards it seems like a little bit of a first grade olympics. Everybody's a winner. :)
Joe
Davenport Ranch, Texas MLS Listings
Austin Texas Commercial homes for sale
Cat Mountain homes for sale
Submitted by Walter Boomsma on August 28, 2008 - 2:34am.
I'm less concerned about the quality and meaning of the awards than I am about customer service in the industry. As Susan points out, 80% isn't really much to brag about.
What's doubly interesting about the overall low ranks is that most customers don't have any objective basis for measuring. We've historically been such a self-absorbed industry customers don't expect much.
What prevents an agency (or agent) from focusing on customer service and surveying it's own customers? Do we care more about what JD Powers thinks than what our own customers think?
What prevents us from learning from these numbers? For example, notice the fact that 23% who were listing sold with their SECOND agent. Sounds like one could conclude customers have a one in four chance of listing with an agent who gets the job done.
Until we get serious and sophisticated about customer service, customers are going to contine to view us as a necessary evil. I haven't kept statistics, but a large percentage of my clients resist "signing up" too quickly because they've been "burned" by another realtor.
And I'm tempted to tell them "you don't know the half of it."
Submitted by Walter Boomsma on August 28, 2008 - 2:34am.
I'm less concerned about the quality and meaning of the awards than I am about customer service in the industry. As Susan points out, 80% isn't really much to brag about.
What's doubly interesting about the overall low ranks is that most customers don't have any objective basis for measuring. We've historically been such a self-absorbed industry customers don't expect much.
What prevents an agency (or agent) from focusing on customer service and surveying it's own customers? Do we care more about what JD Powers thinks than what our own customers think?
What prevents us from learning from these numbers? For example, notice the fact that 23% who were listing sold with their SECOND agent. Sounds like one could conclude customers have a one in four chance of listing with an agent who gets the job done.
Until we get serious and sophisticated about customer service, customers are going to contine to view us as a necessary evil. I haven't kept statistics, but a large percentage of my clients resist "signing up" too quickly because they've been "burned" by another realtor.
And I'm tempted to tell them "you don't know the half of it."
Submitted by Jodi Summers on September 1, 2008 - 8:32pm.
Good agents know who they are.
More great statistics for the arsenal.
Thank you,
Jodi Summers
Sotheby’s International Realty
jodi@jodisummers.com
www.SoCalGreenRealEstateBlog.com
www.SantaMonicaPropertyBlog.com
**
The real voyage of discovery consists not in making new landscapes but in having new eyes. - Marcel Proust
Submitted by Keith Labrecque on September 4, 2008 - 2:42pm.
Yes, Good Agents know who they are! So what?
Now if only the general public also could know with some reliability, wouldn't that shake up the industry ! ! ! Perhaps even to the point of individuals' rates being set by supply and demand - like other true professions?
I can imagine a transparent system that surveys EVERY client regarding each professional or team after each contract, so the sample size would be high and the data very representative. Surely, careful survey design and reporting is needed, but just imagine the improvemnts in customer service. It's a well-known of tenent of management that if you want to improve something, you have to measure it!
But I can already hear the ROARS of PROTEST from the weak performers, as they are the only ones to lose if the sun shines in on objective performance.
Submitted by alison sylvester on September 4, 2008 - 2:53pm.
Did anyone notice the percentages did not total 100% - re how many people used internet, past client, referral and paper medium. Is this a typo or a report error? Any ideas or am I understanding what this aspect of the report is saying. My interpretation is that 46% of all surveyed 3200 selected a realtor on the basis of a referral, 28% found a realtor using the internet -likely a particular property on the internet created the connect, 23% past client - easy and 11% likely found an ad in the paper, magazine etc. etc. The numbers total 108% - is the error in my math or my understanding? Ideas?
Submitted by Matt Carter on September 4, 2008 - 3:25pm.
Alison, the numbers add up to more than 100 percent because respondents may choose more than one answer.
You might rely on recommendations from friends and family AND use the Internet, for example.
Submitted by Carol Smith on September 15, 2008 - 8:59am.
As it is always important to know the facts and understand the data before passing judgment and drawing conclusions, Keller Williams Realty International decided not to pay for the license. As a Keller Williams agent, we have been asked not to refer to the JD Power & Associates name in any of our print or on-line advertising.
Submitted by Debby Crawford on September 15, 2008 - 10:46am.
Having owned my own brokerage,I intentionally chose when I relocated to Atlanta. A core philosophy at Keller Williams is that it is about the agents business. It is my brand and many choices of how I run my business are just that my business my choice. I nor Keller Williams Realty nor its agents need rely on an award for momentum or validation. Those are some of the reasons that Keller Williams Realty chose NOT to buy a license in is contrary to our culture of leading with revenue and about the Agents branding... While an honor it is not a tool we need.
Submitted by Gina Duncan on September 15, 2008 - 3:08pm.
As a Keller Williams agent in Maui I can speak with knowledge that even though I know other great agents with other good companies, Keller Williams does in their Core Values emphasize the following (see below) and if you don't subscribe to these ideals you don't work at Keller Williams. KW also strives to provide cutting edge education to all its agents including Gary Keller's new book "Shift". These two examples among others (and I've always worked small independent companies previously) makes it a great company to provide top level service to buyers and seller clientele.
Win/Win: Or no deal
Integrity: Do the right thing
Commitment: In All Things
Communication: Seek First to Understand
Creativity: Ideas before Results
Customers: Always come First
Teamwork: Together Everyone Achieves More
Trust: Starts with Honesty
Success: Results through people
Aloha, Gina Duncan, R (S) ABR, e-Pro
www.FineIslandProperties.com
Submitted by Joel Maynard on September 30, 2008 - 9:01pm.
I think good solid customer testimonials are a more powerful marketing tool than an arbitrary award.
Joel Maynard
Site Hope Lending.
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