Page |1
REPORT PREPARED FOR: Dr. NITIN SETH
COMPANY NAME : BARFOOT AND THOMSON
REPORT TITLE : CHANGING DREAMS INTO REALITY !
BY : SWATI CHAWLA
POSTGRADUATE DIPLOMA IN BUSINESS
APMG 8119: DIGITAL ENTERPRISE
ASSOCIATE PROFESSOR -DR. NITIN SETH
AUTHOR CONTACTS
NAME: SWATI CHAWLA
Mobile:
0226782166
Email:
swatarun@gmail.com
Student ID: 1457595
________________________________________________________________
Page |2
TABLE OF CONTENTS
CONFIDENTIALITY AGREEMENT/ AUTHOR CONTACTS ................................. 1
TABLE OF CONTENTS ........................................................................................ 2
EXECUTIVE SUMMARY ...................................................................................... 3
INTRODUCTION .................................................................................................. 4
BUSINESS OVERVIEW........................................................................................5
CE AND OCE...................................................................................................... 6
CUSTOMER BEHAVIOUR....................................................................................7
IMPLICATIONS......................................................................................................8
VIRTUALEXPERIENCE/CUSTOMER ETENTION...............................................9
CONCLUSION.....................................................................................................10
REFERENCES ................................................................................................... 11
APPENDICES ..................................................................................................... 12
________________________________________________________________
Page |3
EXECUTIVE SUMMARY
The job of a Real Estate Company is to help people to either buy or sell a home
or a piece of property ,it can be a piece of land or small starter homes to exotic
islands and luxury mansions. Either there is a listing agent, to help a client sell a
home, or a buyer's agent, to help the client buy a home. These people are truly
knowledgeable about their local laws on the buying and selling of property and
the geographical area that an agent works in is their area of expertise.
The online property portals are catching up very fast in the whole world. They
offer people a good variety of choice for both buying and renting homes. It
doesn't matter where you are located and where you are looking for property, you
can easily browse through results from all across the country and make your
choice and decision.
The aim of this report is to understand the working of Barfoot andThomson, their
customer dealing and the satisfaction rate along with the problems faced of
people interacting with them.
The report will describe the role of consumer behaviour ,customer
experience with the company ,various implications and lack of virtuality in context
with Barfoot and Thomson.
________________________________________________________________
Page |4
INTRODUCTION- BARFOOT AND THOMSON
The Government's much-flaunted affordable home build in Auckland has just
become a little less affordable after developers were granted a series of price
hikes (NZ Herald, 2015). It has also emerged that the development company
sought even higher prices, but was turned down by the Government and they are
open about the inevitability of increase .
The sale price of an average residential propert was $776,729 in March but that
rocketed up to $804,282 last month and the average was therefore up $27,553 in
one month alone or $918/day but volumes were down sharply from 1597 sales in
March to 1070 last month (Barfoot & Thomson,2015)
Scott Hayden from Barfoot and Thomson Quoted that “The strength of the brand
of Barfoot and Thomson simply helps you get in the doors in the first place”
Barfoot and Thomson has a vision and unparalleled levels of service that has
become appreciable.They thrive on the negotiation process and take pride on
going that extra mile for their client. Every employee here has brilliant
interpersonal and communication skill and are popular among people for their
reputation of being honest and ethical( Dunford,2015)
Barfoot and Thomson is a privately owned and managed business which helping
people buy ,sell, rent homes. Founded in 1923 by Val Barfoot ,now with a new
director Kiri Barfoot ,it has 67 locations in Auckland and Northland with a team of
over 1400 residential and commercial employees( NZ HERALD ,2015)
It is worth mentioning here that ,Second time in a row ,Barfoot’s are the proud
owner of The large Estate Agency of the Year Award aong with Best Real Estate
Agency ,New Zealand ,Best LettingAgency and Readers digest Quality Service
Award Reader Digest(2015)
________________________________________________________________
Page |5
BUSINESS OVERVIEW
Barfoot and Thomson sold almost 250 houses for more than $1 million each as it
had its highest number of new March listings in six years.
Barfoot & Thompson ‘s 1705 new listings were made last month, up from 1476 in
the same month last year More than 1390 residential properties were sold last
month, up 80 percent from the month before.
"March was traditionally the busiest month in the property calendar, so it is no
surprise that we saw a significant increase in residential sales when compared to
the previous month," says chief executive Wendy Alexander, Barfoot
The average house price increased 7 percent between February and March to
$725,708, up from $645,928 in March 2013 and The company sold 130 more
houses for $1 million or more than in February.
Its total sales were slightly down on March 2013, with 1392 houses sold this year
compared to 1430 last year(3 news,2015)
Of the 1392 sales, 589 sold for less than $600,000, down from 746 last year,
while 249 were worth more than $1 million and Twenty-five houses sold for more
than $2 million. (3 news,2015)The data also showed that 40 percent of homes
sold in Auckland over a three-month period were bought by people with Asian
surnames.
________________________________________________________________
Page |6
Consumer Experience and Online Consumer Experience
The technical advances in mobile devices now has enabled customers to have
access
to
a
wide
range
of
information
instantly,
receive
minute
services ,download data and make online purchases (Matsuda,2006).
Degree of customization, communication, connectivity and content has become
relevant with online access which in turn enhances customer experience Lee and
(Benbasat,2003).
Barfoot gurantees the customer right value , a good experience taking care of
their choice but they have a tough competition with Bayleys with 60 offices,1100
employees and $4.8 billion sale this year (Bayleys,2015)
Prior knowledge or past experience provide the customer a set of expectations
for the assessment of current purchase (Shim,2001)
We’ve entered the age of the customer — an era when focusing on customers is
more important than any other strategic imperative. Every executive knows that
customers matter. But most companies don’t approach their customer
interactions in a disciplined way (Forrester ,2015)
Thus CE and OCE are important to
1. Improve customer satisfaction
2. Promote Customer loyalty
3. Increase customer referrals
4. Reduce customer churning
5. Create competitive advantage
6. Increase income and sales
7. Build strong customer relationships( Refer to Appendix A)
________________________________________________________________
Page |7
Customer Behaviour
The term consumer behaviour is defined as "the study of how individuals, groups
andorganisations select, buy, use and dispose of goods, ideas or experiences to
satisfy their needs and wants”(Kotler & Keller, 2009).
In other words, the study focuses on howindividuals spending their available
resources - time, money and effort - to create finaldecisions in buying process
(Schiffman, Hansen & Kanuk, 2008).
Customer Behaviour blends psychology, sociology, marketing and economics.
It attempts to understand the decision-making processes of buyers, both
individually and in groups such as how emotions affect buying behaviour.(Refer
to Appendix B).
It studies characteristics of individual consumers such behavioural variables in an
attempt to understand needs of people. It also tries to understand the influence
on the consumer from family, peers, media, reference groups, and society in
general. Customer behaviour study is based on consumer buying behavior, with
the customer playing the three distinct roles of user, payer and buyer. Research
has shown that consumer behaviour is difficult to predict, even for experts in the
field (Close ,2011)
To understand customer behaviour, Heslop (2007) states that marketers must
know how consumers perceive their market offers in competition, while Kotler
and Armstrong (2011)recommend to marketing researchers the key effects of
internal and external factors on consumer purchases, such as, cultural, social,
personality and psychological characteristics. Kotler & Armstrong (2006)
introduce a model of buyer behaviour – (Refer to Appendix C). According to the
Kotler's model the consumer buyer behavior have two parts. First, the
characteristics of the consumer or the ability of the consumer to perceive the
message that has been conveyed by the company for its certain product or
service. Secondly, the decision making process of the buyer also effects the
behaviour .
________________________________________________________________
Page |8
Theoratical Implications
To prepare for this large-scale change, organizations must make significant
investments to properly align all actuarial, finance and risk functions at every
level of the company.
This requires numerous steps and an understanding of the impact on your entire
organization. The proposed standard will expose any risk of misalignment. To
mitigate the impact of the change, organizations must make significant
investments.
1. Maturity of customer experience
2. Determine the root causes of your customer experience problems
3. Work on customer experience improvements
4. Implement or enhance a new or existing customer relationship
management (CRM)
5. Develop a digital experience road map
6. Dedicate personnel to customer experience
7. Allocate budget to customer experience initiatives
8. Craft a customer experience strategy
9. Understand that customer is powerful now
10. Organisational and Structural management
Managerial implications
Changing the way Managers think and do things.
“How much thinking and behaviour on the part of how many marketing
stakeholders likely will change as a consequence of the novel insights of the
paper?” (kohli 2011,p.2)
A
focus
on
marketing
efficiency
and
effectivenee
,and
stakeholder
engagement(Kumar2015,p.2)
It is definitely different from theoretical implications ,but is related.
________________________________________________________________
Page |9
REAL VIRTUALITY
Without any doubt, online shopping is experiencing rapid growth, many people
are still skeptical about the trustworthiness of online shopping. According to a
survey conducted by FirstData[6], 86% of the survey respondents had concerns
in relation to the trustworthiness of online shopping, indicating that trust is the
crucial dimension for online business.
Managers of the companies should create virtual community providing
knowledge based on consumer's demands and the characteristics of products
and services of the e-retailers. Knowledge in enterprise itself should have a
certain authority.
By using technologies with high security, convenience and sociality, a real virtual
shopping experience can satisfy consumer’s demand for information and also
win customers trust and loyalty.
BARFOOT AND THOMSON are trying their best to provide the customer full
online support but they still need to improve in context of real virtuality.
CUSTOMER RETENTION
The goal of relationship marketing is customer retention. Customer retention has
strong economic benefits for a company, in some cases a five percent increase
in customer retention can result in an increase, in a firms profit, of up to eightyfive percent (Nicastro, 1999). Customer retention is also considered to be a more
cost-effective strategy than having a new customers. The benefits of customer
retention include both revenue growth and cost savings. Revenue growth is a
direct result of the expected cash flow . The longer a consumer stays loyal to a
firm, the greater his value to the company, resulting in an increase of revenues
from price premiums, referrals, increased purchase activity and profits from
reduced operation costs (Reichheld 1996). Cost savings are also included in the
total profits, Reichheld (1996, p.132) pointed out in the Quest for Loyalty that in
most industries, "as purchases rise, operating costs decline."
________________________________________________________________
P a g e | 10
CONCLUSION
Now-a-days, understanding consumer behaviour is the key success for every
marketing strategy in order to create and transfer product values to customers as
well as maintain consumer's value and loyalty . Especially in the highly
competitive real estate market, consumer behaviour,experience,business
implications and being virtual becomes more and more important for survival.
Barfoot and Thomson , has considered the importance of cultural, social and
psychological factors that affect consumer behaviour and successfully applied
these knowledge to their traditional and contemporary marketing strategies but
they need to focus more in context of virtuality by giving the customer a real
virtual experience of moving in the house and also paying online. The
development of electronic commerce has been constrained by the inability of
online consumers to feel, touch, and sample products through Web interfaces, as
they are able to do in conventional in-store shopping. Previous academic studies
have argued that this limitation could be partly alleviated by providing consumers
with virtual product experience (VPE), to enable potential customers to
experience products virtually. ( JIANG & BENBASAT,2015)
________________________________________________________________
P a g e | 11
REFERENCES
(Barfoot&Thomson,2015) http://www.interest.co.nz/property/74863/barfoot & thompson-sold-record-numberhomes-last-month-quarter-them-selling-more
Angeline G. Close (2011). Consumer Behavior Knowledge for Effective Sports and Event Marketing. New
York: Routledge. ISBN 978-0-415-87358-1.
Davis, R., Buchanan–Oliver, M. and Brodie R. J. (2000), “Retail Service Branding in Electronic–Commerce
Environments”, Journal of Service Research, 3(2), 178–186
Forrester
(2015)
Retrieved
from
https://solutions.forrester.com/customer-experience/prove-roi-49RA-
3147MY.html
Herald
(2015)
Government
allows
developers
to
charge
more
for
each
house
to
compensateforrisingbuildingcosts.http://www.nzherald.co.nz/property/news/article.cfm?c_id=8
&objectid=11443190
Kotler, Philip (1997), Fundamentals of Modern Marketing. New Jersey:
Prentice-Hall 12.
Lee and Benbasat (2015) A Framework for the Study of Customer Interface Design for Mobile Commerce
Ng, S. (2012), “Regulatory focus and preference reversal between hedonic and utilitarian consumption”, Journal of
Consumer Behaviour, Vol. 11 No. 1, pp. 81-8.
NBR(2015) http://www.nbr.co.nz/article/barfoot-thompson-appoints-first-woman-board-ng-93227
NBR(2015) http://www.nbr.co.nz/article/barfoot-thompson-powerhouse-behind-auckland-property-market
Peter, J.P. & Olson C.J. (2010).Consumer Behaviour & Marketing Strategy . 9th ed.Boston, McGraw-Hill/Irwin.
Schiffman, L.G. (1993), Consumer Behavior, Prentice Hall International, London.
Angeline G. Close (2011). Consumer Behavior Knowledge for Effective Sports and EventMarketing
Vargo, S.L., Maglio, P.P. and Akaka, M.A. (2008), “On value and value co‐creation: a service systems and service logic
perspective”
________________________________________________________________
P a g e | 12
WEBSITES
http://www.interest.co.nz/property/74863/barfoot-thompson-sold-record-numberhomes-last-month-quarter-them-selling-more-1
http://blog.clientheartbeat.com/why-customer-experience-is-important/
http://www.emeraldinsight.com/doi/ref/10.1108/095553413112877
http://blog.clientheartbeat.com/why-customer-experience-is-important/
http://www.3news.co.nz/business/auckland-house-sales-up-80pct2014040415#axzz3jyPzBIax
http://www.3news.co.nz/nznews/labour-barfoot--thompson-staffer-had-bestintentions-2015071609#axzz3jyPzBIax
________________________________________________________________
P a g e | 13
APPENDICES
APPENDIX A
Customer Experience
SOURCE:http://www.marketingquery.com/customer-experience-research-report/
________________________________________________________________
P a g e | 14
APPENDIX-B
CustomerBehaviour
https://www.google.co.nz/search?q=factors+influencing+customer+behaviour+graph&biw=1366&bih=623&tbm=isch&imgil
=jp96uXVUcMLwsM%253A%253ByeEDQmsUalDK5M%253Bhttp%25253A%25252F%25252Fwww.slideshare.net%25
________________________________________________________________
P a g e | 15
APPENDIX -C Model of buyer behaviour
Source: Kotler, P., & Armstrong, G. (2006).Marketing Management , 11th ed. India,Prentice-Hall.
________________________________________________________________