Identifying homeowners’ switching moments to increase sales

How The Re-Wired Group partnered with a homebuilder to increase sales by over 20% by identifying the switching moment of its customers.

Background

During the housing bubble, Bob Moesta and the team worked with a regional homebuilder. The builder’s sales were down significantly compared with previous years. He was struggling to generate enough revenue, and the housing market was in free fall.

The builder had two primary product lines: affordable single-family homes, & condominiums for “downsizers”.

To understand what consumers wanted to buy which would then go on to inform how to design, build and market his houses, he used traditional market research. This research primarily consisted of surveying and interviewing potential customers about what features & benefits they wanted in a new house.

The challenge

Like many companies, the builder used traditional marketing techniques and research tools. He talked to prospects and asked them ‘what do you want in a newly built home?’ Consumers told them they wanted more hardwood floors, granite counters, stainless steel appliances, etc.

Most, if not all, of the homebuilders in the market were engaged in similar types of research and interpreting the results in a similar manner. As a result, many builders believed they had to add more features and benefits to their product designs.

This caused the price of the homes to increase significantly. These factors combined to cause an even greater slow-down in new home sales.

In the end, our client was confused and frustrated. He could not understand why when he designed and built homes that had the features and benefits customers said they wanted, they still did not buy.

Project information

Industry: Construction
Use Case: Consumer Insights
Services: JTBD Interviews and Consultation

He could not understand why when he designed and built homes that had the features and benefits customers said they wanted, they still did not buy.

Our approach.

The Re-Wired Group met with the owner of the building company and explained the Forces of Progress framework and the Jobs To Be Done Research methodology.

As part of that discussion, we explained that when you ask the consumer what features & benefits they want, they are more than willing to tell you. However, those features and benefits are usually less than a quarter of the story.

It is more important to understand the full context of a consumer’s “switching moment”, which includes the anxieties and habits that are holding them back. The reality of the consumers’ situation was that even though they wanted the new features and benefits, those features & benefits alone were rarely enough to cause a consumer to change (“switch”) their behavior. The features and benefits being offered were not meeting the consumer’s real demands.

The builder asked, “how can I find out what’s holding people back from buying?” Our answer was to conduct a series of Jobs To Be Done interviews as part of our Consumer Behavior Consulting services.

We defined a strategy for the interviews and interviewed 40 people that had actually purchased one the new product offerings from the builder in the last 6 months.

The purpose of the interviews was to find the struggling moments, the context of the consumer’s buying situation, and the Forces of Progress at play when they made their decision to purchase.

For example, what pushed them to the new home? What pulled them to the new home? What habits were holding them back, and what anxieties they were experiencing during the buying process?

Traditionally, homebuilders believed that consumers were indifferent between the decision to purchase a single family home or a condominium.

The choice between the two was based on whether the consumer wanted to “take care of their own yard, landscaping, etc. or not”. In addition, homebuilders thought that the more features and benefits they added to the house, the more they could convince the consumer to buy. Homebuilders built all their marketing and advertising around the ideas of location and features.

However, as we analyzed the data from the interviews, a couple insights revealed themselves.

Firstly, there were significantly different patterns of behavior between a single-family homebuyer and a condominium buyer. Primarily, the habits and anxieties holding the buyers of each product back were different.

As an example, the people downsizing into condominiums were worried about “how do I make all of my furniture fit into a smaller home”, or “how am I going to pack up 20 years of memories”. People moving into single family homes were worried about things like, “how I’m going to sell my current home when I am under water on it”, or “how do I qualify for a mortgage”.

Patterns began to emerge from the analysis that not only helped us understand the features and benefits the consumers said they wanted, but also the true struggling moments, habits, and anxieties that needed to be addressed in order to enable new buyers to actually change their behavior.

The Four Forces of Progress. Image shows the struggling moment someone experiences, and the four forces at play that help customers to switch (or not switch) from a product.

The results

Identified clear jobs for the new house or condominium buyer which meant they no longer needed to compete with features.

Insights gathered from this analysis helped to reposition marketing and advertising strategy…

…which led to an increase in sales by over 20% within 12 months (in difficult housing market conditions).

The impact.

As a result of the Jobs To Be Done interviews and analysis, we were able to identify the primary “Jobs” for which the consumer was hiring the new house or condominium.

This included the patterns of pushes, pulls, anxieties, and habits acting on them when making the decision to purchase, and recommendations to the language to use in the advertising & marketing campaigns that would truly speak to the customer.

This new understanding of the consumer’s context and situation enabled us to help the homebuilder refine his overall business strategy, product designs, and marketing & advertising campaigns.

As a result of our work with the homebuilder on these areas of his business, he was able to change the designs and lower the cost of the products, change his marketing & advertising strategy & messaging, and increase sales by 20% over the next 12 months in a declining market.

Patterns began to emerge from the analysis that not only helped us understand the features and benefits the consumers said they wanted, but also the true struggling moments, habits, and anxieties that needed to be addressed in order to enable new buyers to actually change their behavior.

Next steps.

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