How to Change the Satisfaction Equation

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Satisfaction at any point in a customer’s experience is the sum of perceptions minus expectations, says Paul Cardis, president and CEO of NRS Corp.

September 01, 2002

 

Before contract, what level of satisfaction did you expect?
Very dissatisfied
0.3%
Moderately dissatisfied
0.4%
Slightly dissatisfied
1.1%
Slightly satisfied
9.8%
Moderately satisfied
39.2%
Very satisfied
49.2%
NHS Index averages compared with expectation averages:
 
Top 5
Bottom 5
NHS Index
88.8
72.3
Expectation
86.3
90.3
Difference
+2.5
-18.0

Satisfaction at any point in a customer's experience is the sum of perceptions minus expectations, says Paul Cardis, president and CEO of NRS Corp. NHS respondents reported that before signing sales contracts, their expectations tended to be higher than the actual satisfaction scores reported after moving into and living in their new home.

Aligning expectations and perceptions is the key to achieving high customer satisfaction. "Many buyers have unrealistic expectations," Cardis says. "Consumers don't always realize that building a home is not like manufacturing a car in a controlled plant environment. To achieve high customer satisfaction, builders must educate buyers about what they will experience. These survey results show that those who did worse in customer satisfaction set higher expectations and delivered less, while the best builders in the competition set slightly lower expectations, then exceeded them. Overall, they did a better job of aligning expectations."

 

The Methodology
The application process for the 2002 National Homeowner Satisfaction research study began in early spring 2002. Builders from around the country submitted information on each customer from 2001. All participating builders had at least 100 closings in 2001, and every customer from that year was mailed a survey.

The NHS Excellence Awards are given in two categories: more than 500 closings and from 100 to 500 closings per year. Total home buyer satisfaction for each builder is calculated as a weighted average of the company's satisfaction scores across all categories. Survey respondents also are asked to rate their willingness to recommend their builder. Each builder's score for this question then is averaged with its total home buyer satisfaction score to yield an NHS Index score. This score is used to determine the builder rankings in this study.

About 30% of the total survey population of 15,123 contributed data to the study. NRS Corp. developed and deployed the survey, collected the data and analyzed the findings.

Click here to see all survey results.

NRS and Professional Builder jointly verified information provided by participants before the survey mailing to ensure accuracy of closings for the year.

NRS Corp. is a leading research and consulting firm serving the home building industry since 1993. For more information about the NHS research study or the NHS Awards, contact NRS Corp. at 800/851-5823. You also can e-mail questions and comments to NRS at info@nrscorp.com.

Each of the winning builders has a different spin on how to set buyer expectations at a realistic level, but all do it well, realizing that customers hate surprises. Engle Homes/Arizona is perhaps the most demanding of its buyers, forcing them to hold to a strict -- and short -- timetable for all option and upgrade selections. The firm makes sure buyers understand the entire home buying process from beginning to end.

Ginsburg Development Corp. has the toughest challenge in keeping a lid on expectations. "It's very hard for us to exceed expectations because our buyers set them so high," Martin Ginsburg says. "Our customers are very knowledgeable. They do a lot of checking on us before they sign a contract. Wherever they go for information, they hear good things. How can we control that to temper their expectations?

"All we can do is educate them as thoroughly as possible, be as patient as we can and keep our motto in mind: 'Always with integrity.'"

Ginsburg also takes relating to customers on a personal level to a new industry high point. He throws "block parties" two or three times during construction and takes new buyers on hard-hat tours of the site. The hidden goal is to introduce new buyers to existing homeowners to build the social fabric of the community.

Village Homes recently organized a Hawaiian luau for 300 new and previous buyers in one of its communities. All the NHS Award winners are searching for creative ways to keep the warm, fuzzy relationships with buyers percolating. You can bet that salespeople with business cards are at every event.

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