In the 1990s, Porsche was on the verge of bankruptcy. Executives hoping to save the storied car brand set their sites on the burgeoning SUV market and set out on a mission to understand the market’s appetite for a luxury SUV.
After confirming that customers would welcome a Porsche SUV, the product team gathered feedback from consumers on every aspect, finding that they were willing to trade off on manual transmission (a staple in all Porsche cars up to that point) in favor of other iconic features that Porsche had become known for, including sportiness, power and handling.
Harvard Business Review wrote that, “The customer-listening process continued with every proposed feature. If customers valued and were willing to pay for them, they were in. If not, no amount of convincing from Porsche engineers could overrule the end user.” The Porsche Cayenne soon hit the market and was an instant success. It later became the most profitable vehicle in the industry.
Around the same time, the CEO of Fiat Chrysler declared, “of all the cars I can get wrong, it ain’t this one.” The car he was referencing was the Dodge Dart, a vehicle for which the company shut down production just a few years after it’s launch, amassing a huge financial loss. So what went wrong? Harvard Business Review shared this valuable lesson: “The underlying cause…was that Fiat Chrysler did not try hard enough to find out what the American compact car customer wanted, valued and was willing to pay for, before turning the Dart over to engineers and designers to build it.”
How this Applies to Real Estate
Real estate brokers and agents do a lot of guessing. For example, when a person is looking to buy a house, the assumptions are all about location and price. While those things are important, on a number of occasion there could be other compelling reasons that are driving the buying decision.
Therefore, real estate professionals can increase their client base and closing numbers by taking more time to engage with buyers to understand what is driving their decisions.
You can ask more probing questions such as:
— What life changing event made you decide to buy a house now?
— What would you like to change about where you are currently living?
— Are you an outdoors person that like to do yard work?
As with the success of Porsche, it pays to take time to really listen and understand what your clients want.