Reporting from the 4th Annual RealService / GRESB Customer Experience Seminar
“Today we are launching the search for property’s next holy grail. It’s our belief that we as an industry need to be able to better measure and prove the return on investment in improving CX,” said RealService founder and MD, Howard Morgan.
Setting the scene at the start of the fourth annual RealService / GRESB customer experience seminar hosted by The Crown Estate in London on November 7th 2019, Morgan went on to explain: “It is easier to spend the money than it is to measure the impact of it.
“There will be those who say that investing in improving CX is about belief – that you’ll never be able to measure it, it’s just too complex. Well, we disagree.
“Those like us at RealService, and no doubt many in this room, who intuitively believe in investing in CX, need to expect to come under scrutiny from two important stakeholders – our investors and our occupiers.”
It was clear from the full house and lively sessions that measuring the return on customer experience is firmly on the agenda in the property industry. However, the conundrum now is where best to invest your customer-experience budget, and how to judge if it was money well spent.
Morgan has been preaching for 20 years that real estate is no longer a bricks and mortar business but firmly ensconced in the hospitality industry. “It’s a crazy world and in times of great change the only sound strategy is to stick close to your customers,” he said. “They will tell you exactly where to go with your business.”
Morgan and Harriet Jones, the Producer of property networking group Experience Makers, have started the search for the ‘holy grail’ and have been working on a method of measuring ROX.
“So, if CX professionals can demonstrate that by investing £X you will be able to increase your Net Promoter Score by Y points and increase total returns or net revenue by Z%, we will be able to access the funds we need to improve CX and raise the status that our specialism deserves.” said Morgan.
Measuring ROX scorecard
Harriet Jones introduced the prototype ROX Scorecard which asks those proposing to spend CX budget to identify the target audience, the overall purpose, how this fits with their CX strategy and the resources necessary. Crucially, it also asks for the intended emotional/social output, the hoped-for change in customer behaviour and the financial outcome. All three should have targets and measurement strategies identified.
“Before you can successfully evaluate the impact of Customer Experience investments, you need a clear CX strategy,” said Jones. “The scorecard should help you identify and measure what would otherwise be deemed simply ‘aspirational’ or ‘fun’,” she said.
Jones explained how the Scorecard would enable faster and better decision making, quicker budget approvals and the knowledge that money has been spent wisely.
The customer lens
The keynote address was delivered by The Crown Estate’s Director of Central London, James Cooksey, and he welcomed the idea of a ROX scorecard.
“We have recognised that if we are to maintain our relevance we must operate as a business which adds service to the customer, rather than a property company that organises leases,” he said. “You can’t just build stuff and say, ‘do you want it?’ We need to do everything through the lens of our customers and to do that we need to get to know them.
He emphasised the benefits of customer engagement, saying: “There are people elsewhere who think customers are a pain in the proverbial, to be avoided at all costs. From our experience, engaging with customers is rewarding and enables us to build strong relationships. Now is our time.”
James Cooksey, Director of Central London, The Crown Estate
Completing GRESB assessments is a task undertaken by many investment managers and property companies and Roxana Isaiu, the GRESB real estate director, emphasised in her presentation that sustainability “no longer stops at climate risks and resilience”.
Stakeholder engagement is now a growing component of the GRESB assessment, but she was surprised that although many GRESB members were undertaking customer surveys, only 27 per cent of more than 1,000 portfolios were using the Net Promoter Score. “That is very low, considering it is the most comparable and the most quantifiable way of measuring customer experience,” she said.
Her advice to GRESB members wanting to engage with their stakeholders was to carry out a survey of occupiers / customers. “Once you have your baseline and your NPS score, in principle the only way is up. It is important to measure. You have to start somewhere, so start with a few assets and start measuring,” she said.
Investment managers have traditionally been reticent to spend client cash on occupier engagement but are now having to react to investors who want to see initiatives in environmental sustainability, health and wellbeing and customer experience.
Kaj Bakker, the sustainability manager for Europe with Cromwell Property Group, said the company’s asset managers were now rewarded based on the NPS (customer loyalty) scores they achieved. “We needed data and for that we went to our customers, carried out research and now the NPS score is the best way for our asset managers to chase their bonuses,” he said.
“They were worried that there were different cultures in different countries, but you can get a ‘nine’ in Italy or a ‘nine’ in Finland – or you could get a zero. It just depends on how good the relationship is between the asset manager, the property manager and the customer. “The key is to ask your customers. If you hide behind your property manager or facilities manager, you cannot make a real impact, especially on customer retention.”
The operator’s view
When it comes to the operator’s view, the main issues have been extracting and justifying a customer-experience budget from investors. Speaking from the operators’ perspective, Sylvana Young, chief design officer at Get Living, said allocating budget to different projects is based around Get Living policies which focus on Tech, community amenities and wellbeing.
“Feedback suggests our customers want us to get the basics right. They want to know they have a good home, which is well-managed, and they feel secure. However, occasionally you do get the impression that a strong internet connection is more important to some residents than having hot water!”
Get Living’s customer experience activities have included pizza making, ‘paint like Banksy’ classes, and outdoor exercise sessions. “Measuring the impact is challenging,” said Young. “We try to look at cost versus benefit, but there are so many factors which contribute to that process that it is hard to value. We use NPS data from thousands of residents, getting feedback at the beginning, middle and end of their leases; we use ReviewPro to harvest comments on social media and there is an element of anecdotal evidence.
Endorsing ROX, Young said: “Can we clearly measure the return on experience? No, we can’t, so it would be great to have industry guidance and a process for putting a value on input versus output.”
Chris Garthwaite’s lessons from outside the industry featured how the rail network was transforming its outdated ethos of passengers as “self-loading freight” into a culture which put its customers front and centre. Using its Heartbeat(R) product to map the differences between passenger expectations and reality, Garthwaite’s consultancy CGA is helping the rail industry get back on track.
An expert panel of Chris Richmond (Head of Real Estate at PwC), Dr Danielle Sanderson (lecturer, UCL), David Wright (Director, Director Group) and Darryll Colthrust (SVP of Technology) offered external perspectives, emphasising the value of putting customers at the heart of your property business.
Colthrust was forthright. Asked if there were ways of gathering information without dealing directly with customers, he said: “You cannot get around talking to your customers. You have to talk to them to get context, otherwise all you have is data. The last best experience someone had anywhere is the experience against which they will judge you. You can’t just link it to real estate – they are comparing you every single day.”
Summing up at the close, The Crown Estate’s Head of Customer, Michelle Laramy, endorsed the importance of having a clear CX strategy and a process by which you can assess, measure and prove the success of that strategy.
Tooling up with the ROX Strategy Scorecard can help you judge your CX outputs and is the first step on the road to measuring the return on experience. Holy grail, here we come.
Clockwise: Kaj Bakker of Cromwell Property Group (l) in conversation with Howard Morgan; Networking opportunities; Roxana Isaiu, Real Estate director at GRESB; James Cooksey at the lectern
RealService would like to thank The Crown Estate for hosting the event; James Cooksey, of The Crown Estate for his keynote address; speakers Michelle Laramy, Kaj Bakker, Sylvana Young, Roxana Isaiu, Chris Garthwaite and panelists Chris Richmond, Dr Danielle Sanderson, David Wright and Darryll Colthrust.
Want to know more?
RealService can help you measure customer loyalty and advise you on your CX strategy.
If you’d like to discuss ROX call Howard Morgan on 020 3393 9603 or contact RealService on firstname.lastname@example.org
You can find out more about CX networking group, Experience Makers, at www.experiencemakers.com