“Consider research done by the Forum Corp.,” writes Tom Peters, one of America’s foremost business gurus. “Fifteen percent of those who switched to a competitor did so because they ‘found a better product. . . Another 15 percent changed because they found a ‘cheaper product’ . . . Twenty percent high-tailed it because of the ‘lack of contact and individual attention’ . . . and 49 percent left because ‘contact from the old supplier’s personnel was poor in quality.’ It seems fair to combine the last two categories, after which we could say 70 percent defected because they didn’t like the human side of doing business with the previous product or service provider.”
Too many landlords would snort, “what does that have to do with me, I’m not business, and I certainly don’t have customers.” One of the reasons those same landlords have so many crises is that they are either unaware or unwilling to accept the fact that they are in business and that tenants are customers. In fact good tenants are the sort of customers many small businesses would walk over hot coals to serve: they come back month after month, and spend thousands of dollars a year.
Tenants act the same way that customers of other businesses do. They move for the same reasons that customers stop doing business with other kinds of businesses. The statistics Tom Peters quotes ditto those in studies of the people who live in our rental properties. One recent study showed several pernicious tenant perceptions and attitudes. Most of those attitudes would be, if not avoided, at least lessened if landlords communicated with their tenants more effectively.
Among other things, the survey showed that tenants resent the fact that it often appears that we are only interested in them when we “want something,” such as a rent increase. They also compare how we treated them before they moved in with how we did after they became our customers.
When dissatisfaction increases, they use moving out as the weapon to “punish” us for perceived shortcomings. The need to punish far overshadows the inconvenience and expense of moving.
Here’s a bulletin. Your tenants don’t ever talk or think about you except when you do something or when they want something—or when they pay the rent. What they think about you depends on how you communicate with and what you communicate to them. If you can control the communication to your benefit, you are steps ahead of the game.
The secret is, they don’t know you care unless you tell them. You have to attract their attention explaining what a terrific job you are doing to keeping your rental properties and their homes great places to live.
So how do you do that? First you have to figure out all the outstanding things you are doing. Making a list is a good idea to start with. If you can’t come up with anything, you may have a larger problem than just communication. Even so, make a list of the things you would like to achieve and create a plan for doing them.
That done, tell your tenants.
If you have just a few rentals, phone calls are easy and effective. You can call all your tenants every couple of months to ask how things are going, remind them what you have done and tell them what you are going to do. Just make sure you actually do what you say you will do, otherwise you’d be better off not calling at all.
If you have hundreds of rentals, obviously phone calls aren’t practical. But newsletters, updates, letters, thank you notes and written explanations of your accomplishments and your plans for their homes are both practical and effective.
Your tenants won’t even consider a “better product” or ever punishing you for “not caring” if you make it clear that you do care, that you value them as your customers. As you read this you might have some good tenants thinking about moving. What can you do today to announce that you want to keep him or her as a customer?
