Customer focus iref

27 December, 2014CUSTOMER CARE - IREF PROF. SURESH MALKANI

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Vakaratunda, Mahakaya ,Surya Koti Samprabha

Nirvighnamkuru me dev,Sarva Karyeshu Sarvada


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Learning Objectives

Where does the customer fits in a service operation?

What perceived risks does a customer face in purchasing

and using services?

How do customers form expectations and differentiate

between desired and adequate service levels?

Why do people often have difficulty in evaluating the

service they use?

How does reducing or increasing the level of customer’s

contact with a service supplier affect the nature of their

service experiences?

CUSTOMER CARE IN REAL ESTATE

27 December, 2014CUSTOMER CARE - IREF PROF.

SURESH MALKANI 3

Real Estate value chain


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YESTERDAY…TODAY…TOMORROW


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Customers

were:

Customers are: Implications:

Less well informed

about

products

More financially informed Customers aware of competitors

More loyal to

providers

Less loyal to providers Customers more prepared to

switch providers

Faced with less

choice

Faced with greater product

choice

Highly competitive market harder

to retain customers

Limited by

traditional channels

Empowered by the Internet

and new technologies

(WAP phones, call center

Technology)

Increased customer focus

through development of

distribution channels


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PAST PRESENT MOVING FORWARD

Lack of Industrial Status In line for industrial status“Want it now generation” is young, productive and demanding (quality)

Finance being arrangedmainly from pre-sellingof the units

Multiple sources of funding –Debt, PE, VC,

Fully organizedindustry

Limited purview of thegovernment

Enjoys strong attention of the central as well as state government

Well placed industrystandards

Quality of constructionaverage

Remarkable improvement in the quality and designs of construction

Industry regulator inplace to control thesector

Lack of transparency Improvement in the transparency level

FDI allowed in acrossreal estate avenues

Emergence of well-defined product categories

REITS/REMFsincreasing the depth

THE REAL ESTTE SECTOR’S

PLAYERS PRE2000

2001 - 2010 2011 ONWARDS

CHANGING SCENERIO

AGENTS ,EASTATEAGENTS ,BROKERS ,CONSULTANTS

LOW ETHICS

BETTERETHICS

PROFESSIONAL

From one man show to broking firm with staff; affiliations; as part of networks.From pocket book to software based and internet savvy.From cash to service taxed.From ‘chitti’ to ‘bills raised.’From ‘ chappal’ and ‘paan’ to tie and blazer!From night bar gossips to dinners and discussions.From showing customer ‘ just – idhar – just adha ek km to Google basedFrom suburb based to corporate broking house/ MNC/ From dingy shops to website operated….

CUSTOMERS

UNPROFESSIONAL

PROFESSIONAL

HIGHLY PROFESSIONAL

Willing to use professionals [brokers/ agents/ consultants / ]Willing to pay , but highly demanding service levelsGood homework.Ability to zero in ‘ as per specs’ property.Well informed.Well educatedHas access to Google / Yahoo / property portals / Access to research reports

DEVELOPERS LOW ETHICS

PROFESSIONAL

GOOD ETHICS

From sly to professional to systematic & organised.From regular to ERP / CRM / SAP based.From one man show to 2nd generation managed (MBA/ engineer sons)From small outfits to corporate(ISO certified); to PE funded; public listed; MNCFrom secrecy shrouded to transparent (heavy closed cabins to open office)

IMPACT OF GLOBALISATION


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PLAYERS IN REAL ESTATE – IMPACT OF GLOBALISATION ON BROKING COMMUNITY


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PLAYERS PRE2000

2001 -2010

2011 ONWARDS

EARLIER SCENERIO(FROM)

CHANGED SCENERIO(TO )

AGENTS ,EASTATE AGENTS ,BROKERS ,CONSULTANTS

LOW ETHICS

BETTERETHICS

PROFESSIONAL

One man show.

Pocket book.From cash.From ‘chitti’From ‘ chappal’ and ‘paan’ From night bar gossipsShowing customer ‘ just – idhar – just adha ek kmFrom suburb basedFrom dingy shops ….

broking firm with staff; affiliations; as part of networks.software based and internet savvy.service taxed.‘bills raised.’tie and blazer!

dinners and discussions.

Google basedcorporate broking house/ MNC/ website operated….

PLAYERS IN REAL ESTATE – IMPACT OF GLOBALISATION ON DEVELOPERS


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PLAYERS PRE2000

2001 -2010

2011 ONWARDS

EARLIER SCENERIO(FROM)

CHANGED SCENERIO(TO )

DEVELOPERS LOW ETHICS

PROFESSIONAL

GOOD ETHICS

sly

irregularone man show

small outfits

secrecy shrouded

professional to systematic & organised.ERP / CRM / SAP based.2nd generation managed (MBA/ engineer sons)corporate(ISO certified); to PE funded; public listed; MNCtransparent (heavy closed cabins to open office)

Category 1970–1979 1980–1989 1990–1999 2000–2009 2010–2019

Geography Local Regional National Global Without Boundaries

Competition Many Competitors Some Competitors Few CompetitorsStrategic Competitors

New Competitors

Business Strategy Focus On Location Focus On DesignFocus On Operations

Focus On Customers

Focus On Customers Of Customers

Goals Market-Driven Capital-DrivenPerformance-Driven

Relationship-Driven

Knowledge- Driven

Market Dynamics Fighting Over Sites Fighting Over MoneyFighting Over Marketshare

Fighting Over Talent

Fighting Over CustomerShare

Operational Focus Collecting Reputation Collecting AssetsCollecting Competitors

Collecting Clients Collecting Relationships

Leadership Personality- Based Functionally- Based Service-Based Solutions-Based Strategy-Based

Organization Few Teams Appearance Teams Necessity Teams Reoccurring Teams Virtual Teams

Brokerage A Representative A Broker A Specialist An Advisor A Confidante

Founder An Entrepreneur An Executive A Leader A Coach A Collaborator

Growth Strategy Growth From Market Dynamics

Growth From Abundance Of Capital & Financial Engineering

Growth From Consolidation, Securitization & Digital Economy

Growth From Customer Connectivity, Talent & Capital Shifts

Growth From Globalizations, Generational Shifts, New Urbanism & Greening

Tommorow never comes !


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Customer Criteria for Selectinga realtor

• Availability (24 hour ATM)

• Convenience (Site location)

• Dependability (On-time performance)

• Personalization (Know customer’s name)

• Price (Quality surrogate)

• Quality (Perceptions important)

• Reputation (Word-of-mouth)

• Safety (Customer well-being)

• Speed (Avoid excessive waiting)


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Ten key determinants of a customer(1)

Concerned with the quality outcome of the service

Access – Approachability and ease of contact

Credibility – Trustworthiness,beleiveability,honesty of service provider

Knowledge – Understanding the customer, making effort to know customers & their needs

Reliability – Ability to perform the promised service dependably and accurately

Security – Freedom from danger,risk,or doubt


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Ten key determinants of a customer(2)

Related to the delivery process

Competence – Possession of the reqd skills & knowledge to perform the service

Communication – Keeping customer informed in a language they can understand &

listening to them

Courtesy – Politeness,respect,consideration and friendliness of contact personnel

Responsiveness – Willingness to help customers & provide prompt service

Tangibles – Appearance of physical facilities,equipment,personnel & communication material


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SERVQUAL DIMENSIONS

ORIGINAL TEN DIMENSIONS FOR

EVALUATING SERVICE QUALITY TANGIBLES

RELIABILI

TY

RESPONSI

VENESS

ASSURAN

CE EMPATHY

TANGIBLES

RELIABILITY

RESPONSIVENESS

COMPETENCE

COURTESY

CREDIBILITY

SECURITY

ACCESS

COMMUNICATION

UNDERSTANDING THE

CUSTOMER

Relative Importance of Service DimensionsWhen Respondents Allocate 100 Points

Reliability

32%

Tangibles

11%

Assurance

19%

Empathy

16%

Responsiveness

22%

Tangibles Reliability Responsiveness Assurance Empathy


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CUSTOMER AND YOU


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(1) you do not have to constantly search for new clients,(2) your revenues and customer loyalties increase,(3) your net income should increase, and(4) your marketing costs will decrease.

Within the real estate brokerage industry, success is determined by the number and quality of valued, recurring customer relationships.IF YOU GET THIS RIGHT THEN:

HOW WILL YOU GET THIS RIGHT ?

What Investors/customers Value Most in Their Broker


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1. Understanding of their goals/objectives.

2. Quality communication and follow through.

3. Direct solicitation of potential buyers or tenants.

4. Accuracy and quality of financial analysis.

5. Quality of research.

6. Negotiating skills.

7. Quality of marketing/investment sales package.

What Tenants Value Most in Their Broker/Service Provider


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1. Understanding of their business.

2. A relationship built on trust.

3. Open communication and accessibility.

4. Collaboration and a team approach to their needs.

5. Financial/analytical skills and structuring advice.

6. Knowledge of value-add opportunities.

7. Understanding of the market and opportunities.

What Clients Value Most When Selecting Their Broker


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1. Relationship with Broker.

2. Prior experience/performance.

3. Understanding of their business/objectives.

4. Reputation of firm/brand identity.

5. Fee structure.

6. Knowledge and advice.

7. Personalized approach/solutions.

What Frustrates Brokerage Clients


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1. Lack and poor quality of communications.

2. Lack of accessibility to their representative.

3. Lack of interest in their business, needs, and goals.

4. Feeling that they are just a fee source.

5. Brokers not knowing when they are in over their heads.

6. Sloppy work, inaccuracies, and poor reporting.

7. Go-it-alone service providers.

Define Your Customers


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• Who are your past clients?

• Who are your current clients?

• Who are your competitors’ clients?

• Which customer segments are growing in your marketplace?

• Which customer segments are shrinking in your marketplace?

• What customers would benefit most from your core

competencies?

• Which customer segment(s) would be the most difficult to

penetrate?

• Which customer segment(s) would be the least difficult to

penetrate?

• At the end of the day, do not forget the value of existingcustomer relationships


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“A customer is the most

welcome visitor to our

premises. He is not dependant

on us, we are depending upon

him. He is not interruption to

our work, he is the purpose of

it. He is not an outsider on our

business, he is part of it. We

are not doing a favor by

serving him, he is doing us a

favor by giving us an

opportunity to do so”

CUSTOMER DEFINATION

Definition of Consumer Behavior

• …the decision process and physical activity individuals engage in when evaluating , acquiring , using ,or disposing off goods and services.

As applieed to real estate:

…the decision process and physical activity an individual engage in buying/selling a piece of real estate and evaluating , acquiring , using the services of a consultant /realtor for the purpose


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DEMAND GROWTH –EFFECT OF 3 A’s


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Affordability Availability Aspiration

Rising per capita income Quality construction

“Want it now generation” is young, productive and demanding (quality)

Growing trend of double income families

Benign interest rates

Close affinity of Indians to “own” a house… and a house bigger than before

Robust business growth in services sector allows aggressive geographic expansion .

Easy access to home loans .

Corporate offices asking for world class space

27 December, 2014CUSTOMER CARE - IREF

PROF. SURESH MALKANI27

INFORMATIVE (THINKER)

Car-Laptops-Real estate

Model: Learn-Feel-Do

Media: Print media; brochures

AFFECTIVE (FEELER)

Sports cars and motorcycles Fashion apparel and jewellery,

Perfumes

Model: Feel-Learn-Do

Media: Audio visual media; image based

HABIT FORMATION (DOER)

Bread, Stationery, Soap

Model: Do-Learn-Feel

Media: Audio visual media; image based; POP stimuli

SELF-SATISFACTION (REACTOR)

Cigarette, Liquor, Movies

Model: Do-Feel- Learn

Media: POP stimuli

THINKING FEELING

LOW INVOLVEMENT

HIGH INVOLVEMENT

Consumer behavior while purchasing different categories

Consumer Decision-Making

Process

Post purchaseBehavior

Purchase

Evaluation of Alternatives

Information Search

Need Recognition

Cultural, Social, Individual and Psychological

Factors affect

all steps


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7 P’s for purchasing a flat

• Pawan

• Pani

• Patta

• Prakash

• Paisa

• Paros

• Parking

• Parikrama

Some of these are NEEDS,

Others WANTS


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17 P’s

• Product / Service

• Place & Time

• Promotion & Education

• Price

• Physical Environment

• Process

• People

• Politics

• Public relations

• Probe

• Partition

• Priorities

• Position

• Profit

• Plan

• Performance

• Positive implementation


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Need Recognition (awareness of need)

• The buying process starts when the buyer recognizes a problem or need.

• The need can be triggered by internal ,external, marketing stimuli.

• Ex.- person’s normal needs-hunger/ thrust –rises to threshold level and becomes a drive.


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NEEDS AND WANTS


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Needs are based on LogicPrice, Quality, Company, Standards, Delivery, Service.

Wants are based on EmotionPrestige, Job security, Reputation, Fear, Brands , Locality, Architect, , Ego, Implications, Relationships.

Emotional reasons are always below the surface and are rarely or never openly declared ! They have to be recognised ! The realtor has to sense these early to close the deal.


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EXTERNAL ENVIRONMENT

INDIVIDUAL DETERMINANTS

SOC

IAL C

LASS IN

FLUEN

CES

FAMILY INFLUENCES

OTH

ER IFLU

ENC

ES

PERSONALITY &SELF -CONCEPT

PROBLEMR

DECESION PROCESS

PROBLEM RECOGNITION

INFO SEARCH & EVALUATION

PURCHASING PROCESS

POST PURCHASE BEHAVIOR


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Difficult to evaluate service

Product attributes affecting evaluation

Intangibility of service performance

Variability

Quality control problems


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Personal Needs

Beliefs about

what is possible

Alternatives

Situational

factors

DESIRED

SERVICE

ZONE OF

TOLERENCE

ADEQUATE

SERVICE

EXPLICT & IMPLICIT

SERVICE PROMISES

WORD OF MOUTH

PAST EXPERIENCE

PREDICTED SERVICES

Factors influencing customer expectations


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DIMENSIONS OFSERVICEQUALITY

Access CredibilityKnowledgeReliabilitySecurityCompetenceCommunicationCourtesyResponsivenessTangibles

DETERMINANTS OF PERCEIVED QUALITY

WoM PERSONALNEEDS

PASTEXPERIENCE

PERCEIVED SERVICEQUALITY

EXPECTED

SERVICE

PERCEIVEDSERVICE

SERVICEQUALITYGAPS

Major tasks of any real estate set up

• Service companies are faced with three major marketing tasks; they need to: – increase competitive differentiation

– increase service quality

– increase productivity

THE BEST WAY TO START WOULD BE TO UNDERSTAND THE CUSTOMER’S NEEDS AND WANTS.


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Property purchaser’s behavior

• As marketers we often think of how we will make a killing.

• Rarely do we research the customer ,at most we have a general mental and instant opinion of the customer and our strategy is decided at the first contact.

• Let's get a bit theoretical and examine the buying process from the customers perspective.


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Complete model of consumer behavior buying real estate

Stimuli

(marketer

dominated,

other)

External

search

Memory

Internal

search

Exposure

Attention

Comprehension

Acceptance

Retention

Search

Need

recognition

Alternative

evaluation

Purchase

Outcomes

Dissatisfaction Satisfaction

INTERNAL

DETERMINANTS:

MOTIVATION

PERCEPTION

KNOWLEDGE &

LEARNING

ATTITUDES

SELF-CONCEPT

PERSONALITY

LIFESTYLE

EXTERNAL

DETERMINANTS:

Reference groups

Culture

Subculture

Social class

Family

Start

BELIEFS

ATTITUDES

INTENSIONS


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Motivation & Need Recognition

Preferred State

Marketing helps

property buyers

recognize (or create) an

imbalance between

present status and

preferred state

• When a current property isn’t

performing properly.

• When family is expanding

• When business is expanding

• When new technology property is

preferred

• When the consumer is fed up of the

present location and usage.

• When another property seems

superior to the one currently used in

terms of efficiency.


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motivation

Internal and external factors that stimulate desire and energy in people to be continually interested and committed to a job, role or subject, or to make an effort to attain a goal.

Motivation results from the interaction of both conscious and unconscious factors such as the:

• intensity of desire or need,

• incentive or reward value of the goal, and

• expectations of the individual and of his or her peers.

These factors are the reasons one has for behaving a certain way.


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What activates a need ?

• Time

• Changed circumstances

• Property acquisition

• Property composition

• Individual differences - customised

• Marketing influences


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Information search

• Property buyers seek and use information as part of a rational problem solving and decision making process.

• Buyers first search internally for historically gathered information ,experience, length of time since last purchase, and satisfaction with previous purchase will affect the their reliance on internal information.

• As most consumers purchase real estate infrequently, they rarely rely solely on their past knowledge when selecting a new property to purchase.


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The information search stage

An internal search involves the

scanning of one's memory to recall previous

experiences or knowledge concerning

solutions to the problem-- often insufficient

for real estate products.

An external search may be necessary

when past experience or knowledge is

insufficient, the risk of making a wrong

purchase decision is high, and/or the cost of

gathering information is low.

Personal sources

(friends and family)

Public sources (rating

services like Consumer

Reports)

Marketer-dominated

sources (advertising

or real estate agents

/developers)

The evoked set: a group of

brands from which the buyer can

choose27 December, 2014CUSTOMER CARE - IREF PROF. SURESH MALKANI

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Determinants of External Search


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Internal determinants of buyer

• Motivation

• Perception

• Knowledge and learning

• Attitudes

• Self – concept

• Personality

• Lifestyle


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Internal determinants of buyer -Motivation

• The force that drives a person to buy and use a good or service is called motivation. It explains why people buy what they do and what they are trying to accomplish to fulfil their aspirations.

• Needs arise from the discrepancy between actual and desired states of being. Needs can be classified as utilitarian or hedonic (devoted to pleasure)/experiential.

• As the discrepancy between the desired and actual state of being increases, a condition of arousal called a drive is activated. When the drive becomes strong enough, the consumer will take action in an attempt to satisfy the perceived need..

• Wants refer to specific products that consumers believe will satisfy the need. Benefits are what consumers derive from products and the reasons they want them

• Thus, a real estate buyer may be trying to satisfy both a utilitarian need for space and a hedonic need for status simultaneously. An accurate valuation model must consider that the benefits the buyer is expecting are not limited to financial rewards.


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Internal determinants of buyer -Perceptions

• Perception deals with recognizing, selecting, organizing, and interpreting stimuli to make sense of the world around us.

• Consumers tend to interpret what they perceive so that it does not conflict with their basic attitudes, personality, motives, or aspirations. They pay attention to stimuli deemed relevant to existing needs, wants, beliefs, and attitudes and disregard the rest.

• One perception important to the study of consumer behaviour is the level of perceived risk in a potential purchase. Types of risk consumers face include functional/ performance, financial, physical, psychological, social, and time The amount of perceived risk is a function of the product (price, length of time consumer will own, cost of switching, additional products and services needed to be consumed with it), characteristics of the consumer (resources, willingness to gather and use information, experience), and external forces (information available, options to reduce the consequences of the choice).

• Two investors in similar financial situations may place different risk premiums on a particular investment because of their personal attitude toward risk.


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Internal determinants of buyer –Knowledge & learning

• Information processing describes the series of steps by which information is encountered through some exposure to a person’s senses, attended to, interpreted, understood and accepted, and stored in memory for future use in making decisions

• Elaboration via mental processing transforms this information into beliefs, attitudes and intentions that determine product choice and related aspects of purchase.

• For a stimulus to be effective, it must be of sufficient strength to reach the lower or absolute threshold to activate the consumer’s sensory receptors, creating a sensation. Because of the sheer number of stimuli to which consumers are exposed on a regular basis, not all stimuli will receive additional processing. Consumers subconsciously screen stimuli and select those that deserve their attention.

• People are also more receptive to information that maintains or enhances consistency with their beliefs and attitudes while they avoid information that challenges their beliefs and attitudesThus, real estate marketers may encounter difficulty in communicating with potential

buyers and tenants until the buyer has recognized a need for a move.


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Internal determinants of buyer -Attitudes

• An attitude is an overall evaluation about something combining cognitive beliefs, emotional affects, and behavioural intentions.

• Attitudes may vary along the dimensions of strength, direction (positive or negative), and stability . Also, not all attitudes are held with the same degree of confidence.

• Attitudes based on direct experience with a product are usually held with more confidence than those derived from indirect experience. Confidently held attitudes will usually be relied on more heavily to guide behaviour

• If a consumer does not feel confident in an attitude, he or she is more likely to search for additional information before making a decision. Attitudes held with less confidence are also more susceptible to change.

• The multiattribute attitude model also provides guidance for changing consumer attitudes . The choices are to change the consumer’s beliefs about the product or change the consumer’s ranking of the importance of an attribute. However, whether a positive attitude leads to an intention to purchase a product and, subsequently, to its actual purchase depends on several factors. Attitudes and intentions are more likely to be good predictors of behaviour when they are measured at a time relatively close to when the behaviour is to occur, before situational influences and unexpected events can have an impact


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Internal determinants of buyer – Self - concept

• Self-concept is an organized set of perceptions of the self, comprised of such elements as the perceptions of one’s characteristics and abilities; the perception of oneself in relation to others; and objectives, goals and ideals which are perceived as either positive or negative.

• Self-concept is now generally viewed in several dimensions:

– ideal self (what one aspires to be),

– real self (the way one thinks one actually is),

– self in context (how one sees oneself in different social settings), and

– extended self (possessions and artefacts help define who one is)

• Real estate can be a viewed as part of the extended self, an object that helps to form identity. By their very nature, single family homes almost always perform many highly emotional, individualized, personal roles in the lives of their occupants .Consumers will choose to purchase real estate that either fits with their current self-image or is associated with the ideal image they want to achieve. This may be reflected in both choice of housing style and neighbourhood.


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Internal determinants of buyer -Personality

• Personality accounts for consistent patterns of behaviour based on enduring psychological characteristics . It is the pattern of traits and behaviours that makes one individual unique and different from all others. Personality may be described using the psychoanalytic, socio-psychological, or trait-factor theories.

• Trait-factor theory contends that an individual’s personality is composed of distinct predisposition attributes called traits. Traits are relatively enduring ways in which one person differs from another. These traits are common to many individuals, but vary in absolute amounts among individuals. Traits are expected to exert fairly consistent effects on behaviour regardless of the environmental situation .

• In general, personality appears to be related to how consumers make decisions about innovative products . For example, people who have a high need for cognition enjoy the effort of information-processing activities and may actively seek and consider more information about a product.

• Consumers’ response relative to risk is related to personality. Risk takers tend to be thrill seekers with a need for stimulation and easily become bored. They are likely to list success and competence as their goals in life in contrast to risk avoiders, who list happiness as their first choice


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Internal determinants of buyer -Lifestyle

• Lifestyle refers to the distinctive ways in which consumers live, how they spend their time and money, and what they consider important -- activities, interests and opinions.

• Lifestyles evolve over time, so consumption patterns may change over time

• Consumers will purchase real estate services that are compatible with their lifestyle. Thus, an outgoing, athletic young single who values social interaction will likely place greater value on an apartment that has access to a swimming pool, tennis court, and activity center.Meanwhile, an inner-directed, sedentary young single who values privacy and solitude might value an apartment with a private balcony more.


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External determinants of buyer

• Reference groups

• Culture

• Subculture

• Social class

• Family


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External determinants of buyer-Reference groups

• Reference groups are individuals or collections of people whom the individual uses as source or point of comparison for attitudes, beliefs, value or behaviour. Consumers belong to some of the groups that influence their consumer behaviour and either aspire to join or work to avoid association with others.

• Reference groups affect consumer choice in three principal ways: normative compliance, value-expressive influence, and informational influence– Normative influence is when reference groups affect behaviour through pressure for conformity and compliance.

This pressure is most likely to be felt when the consumer feels the rewards from compliance exceed the cost , there is strong motivation for social acceptance , and the product is publicly conspicuous in its purchase and use .

– Value-expressive influence is when a need for psychological association with a group is evidenced by acceptance of its norms, values, or behaviour and a conforming response is made. The desired outcomes are enhanced image in the eyes of others and identification with people who are admired and respected.

– As an informational influence, consumers often accept the opinions of others as providing credible and needed evidence about products.

• word-of-mouth influence has a more decisive role in influencing behaviour than advertising and other marketer-dominated sources . Greater perceived credibility is the deciding factor.


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External determinants of buyer-Culture

• Culture consists of society’s beliefs, values, ethics, customs, shared meanings, rules, rituals, norms, and traditions. Culture provides people with a sense of identity and an understanding of acceptable behaviour.

• Culture is deep-seated and enduring, but does change slowly over time.

• Values represent beliefs about life and acceptable behaviour. Values express the goals that motivate people and appropriate ways to attain these goals.

• Personal values reflect the choices an individual makes from the social value systems to which that individual is exposed. Individuals are influenced by social values of groups to which they belong (nation, religion, family), but they choose from these various social values to develop their own personal values. Personal values have been linked to brand choice and product usage

• Builders would be wise to watch changing cultural values, producing properties that are more environmentally friendly and housing layouts that are more suitable for family activities and interaction.


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External determinants of buyer -Subculture

• Subcultures are racial, ethnic, religious, or other groups whose members are distinguishable from the general population and who are held together by common culture and/or genetic ties.

• To the degree that people in an ethnic group share common customs, values, rituals, and traditions that are different from those of other ethnic groups or the larger society, they constitute a distinct ethnic group.


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External determinants of buyer –Social Class

• Social stratification represents the hierarchical division of members of a society into relative levels of prestige, status and power . Social class refers to divisions based on economic and demographic characteristics.

• Those in same stratum have roughly similar consumption, lifestyle, and income, and socialize with each other. While upward and downward mobility is possible, most tend to remain in the stratum into which they were born.

• Possessions are symbols of class membership, with wealth reflected in the item purchased. The most important possession decision reflecting a family’s social class is the choice of where to live, both the type of home and the neighbourhood. Thus, social class will affect what neighbourhoods and architectural design consumers will consider for housing. In addition, housing layouts must accommodate the furniture and living style of members of each social class. People trying to move up through the social class structure might choose a house and neighbourhood that they think members of the higher class would choose


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External determinants of buyer -Family

• The most influential reference group is the consumer’s family. The family teaches the consumer cultural values that have a substantial impact upon shopping behaviour. It continues to be a point of reference even when the consumer has formed his own household.

• Family members may play instrumental roles, such as determining the financing and functional attributes of purchases, or they may play expressive roles, supporting other family members in their decision and expressing the family’s aesthetic or emotional needs.

• Those with the most expertise may exert a less direct influence. The decider is usually the person with the financial authority and power to choose how money will be spent.

• Changes in family structure increasingly are causing husband and wife decisions, including those about housing, to be made jointly . Thus, the real estate broker must appeal to both spouses in making a sales presentation.

• Families change over time, passing through a series of stages called the family life cycle The traditional family pattern has been single, then married, married with children, empty nest, retirement, and widowhood. Changes in household and family structure have resulted in many people no longer following the traditional process, delaying marriage, having children out of marriage, and divorcing and remarrying. This creates demand for a wider variety of housing options throughout the life cycle. It also makes it more difficult to estimate demand for housing types based on demographic factors.


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Major tasks of service industries

• Service companies are faced with three major marketing tasks; they need to:

– increase competitive differentiation

– increase service quality

– increase productivity

Post purchase Behavior

Can minimize through:Effective Communication

Follow-upGuaranteesWarranties

Under promise & over deliver

Cognitive Dissonance

?Did I make a good decision?

Did I buy the right product?

Did I get a good value?


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•Real estate has been a savoir and a villain, a source of opportunity, •A political football, and, at times, a regulatory nightmare. •Personalities and cult-like figures have been created, featured, celebrated, and discredited by real estate. •Fortunes have been made and lost because of real estate. Families have benefited from and torn apart because of real estate.Entire industries and companies have disappeared because of real estate. •Real estate has been a passion for some, a job for millions, a hobby for others, and a source of income and wealth creation for many; •Real estate has been a convenient forum for blame as well as—more often—a source of personal and community pride. •No other industry today has so many working parts, conflicting priorities, risks, and rewards. No industry is as integral and essential to our lives. •Real estate is truly a part of everyone’s DNA.

Why, What, When, How, Now, Then


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