The firm notes that developers can no longer compete largely on product delivery, price, or even sales and after-sales service
According to a new report by Strategy& Middle East, Middle Eastern residential developers can differentiate themselves from their competitors and increase value over the long-term by building close, long-term customer relationships through data-driven, customer experiences.
The report titled ‘Creating value and differentiation for real estate developers: Customer first, lifestyle led, data driven’ said that by using innovative technologies and data insights, developers can obtain a better picture of customer lifestyle requirements and post-purchase needs, enabling their customers to find the right community.
It added that this approach would shift the focus from transactions to relationships and can allow developers to adapt their offerings, increase customer lifetime value, generate new revenue streams, and ultimately, beat the competition.
Late in August 2022, real estate fintech start-up Stake said it had raised US $8mn.
“Developers can no longer compete largely on product delivery, price, or even sales and after-sales service. Instead, much like their retail peers, residential developers can differentiate themselves by offering a superlative customer experience that is driven by in-depth customer knowledge and enabled by data analytics,” said Bilal Mikati, Partner with Strategy& Middle East.
Although customer experience is already the main way for developers to stand out from the crowd, these companies can go further to maintain the value of their products. The report highlights the recent changes in the retail sector that used detailed knowledge of customers from data analytics to offer exceptional customer experience, and deployed multiple channels to build loyalty.
He added, “To stand out, developers need to provide personalised products and services for customers. These should be based on lifestyle factors, such as whether people are active or retirees, by drawing on relevant data that provide meaningful experiences.”
Sharjah unveiled a new ‘Holiday Homes Project’ early in August, as part of efforts to diversify economic growth.
The report pointed out that developers have three ways to differentiate themselves and add value: personalisation of products through micro-segmentation of the customer base; expansion of data-driven services; and the exploration of innovative technologies. Developers must cater to the appetite for technology of generation Z (those born after 1997 and who grew up with digital technology), it explained.
Zahi Awad, Principal with Strategy& Middle East added, “Generation Z is now renting and buying homes. This demographic has digital expectations that many developers are not meeting. A great product, attractive price, strong sales and after sales service are not enough. These customers need differentiated products and services that are authentically personalized to their lifestyles, and that provide them with the right community.”
The report advised that developers take a data-driven, community-focused approach to accrue three main benefits and opportunities. This includes a smoother sales experience, which helps to start the long-term relationship; while this is enhanced further with access to established digital communities, providing valuable data on customers, and helping developers tailor products and services; and helping to generate value in the community before the development is completed, turning customers into advocates for the project.
Ramy Sfeir, Partner with Strategy& Middle East concluded, “Using data to understand customers’ needs while placing them in the right setting can also improve their retention. People appreciate, and like to remain, in cohesive communities that reflect their wants. Such established, digitally-enabled communities provide valuable data insights that allow developers to elaborate products and services and come up with new areas for customer engagement.”
PNC Menon, Chairman of Sobha Group told Middle East Construction News (MECN) that smart homes are a critical component of smart cities.