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Note: The names in the video are swapped. The first guest shown is Chris Harold and the second is Tommy Chambers.
The Property Management Show is back with Marie Tepman and Brittany Stephens from Fourandhalf, and today we’re talking about customer lifetime value.
When we think about customer lifetime value, the biggest variable that comes to mind is the length of time a customer stays with your company.
But what happens when your service area is full of military or intelligence personnel, who only need your services while they are deployed overseas?
Our guests today are Tommy Chambers and Chris Harold from Chambers Theory, and not only have they discovered how to protect their customer lifetime – they also found a way to expand it through innovation.
Customer Lifetime Reflects Customer Satisfaction
This season of the podcast is all about companies that are doing so well their customers don’t want to leave.
Chambers Theory tracks a lot of data to review and improve their performance, and according to that data, they’re a company that’s doing very well. We asked Tommy and Chris to talk about some of their most impressive statistics.
Two of the statistics they are always tracking are days on market and average rents. This property management company has lower days on market and higher average rent than any of their competitors. With a slogan that says “Real Estate with Intelligence,” Chambers Theory has managed to embody what they say about themselves. They collect data on their own performance and that of their competitors, and then they use it to their advantage.
- Days on Market
- Average Rents
Sometimes, the results of their data seem intuitive. A property in one area is going to rent faster than a property in another area simply because it’s a more desirable neighborhood.
But it helps to know those numbers.
At Chambers Theory, they look at the historic data and they use their experience to make intelligent decisions and improve the metrics that they invest so much time into collecting.
Here’s what they’ve found:
- Chambers Theory has rents that are an average of 27 percent higher than their competitors. The average rent in the northern Virginia market is close to $3,500 a month.
- The average days on market is 12. This is notable because their competitors have an average days on market of 30.
The data they collect is used to make intelligent decisions and to improve the work they do for their clients
Which helps with their client retention rate.
The simple act of measuring is what’s important. It’s important to the company and their clients. Measuring allows you to see how you can get better and then track your improvement over time. New solutions and innovations show up and the entire team works together to improve.
But, you can only improve by tracking your progress and monitoring the numbers you care most about.
Client Retention Rate
At Chambers Theory, the client retention rate is over 95 or 96 percent.
Tommy and Chris are quick to say that a lot of that has to do with the team and how well they are able to service their clients.
They also have a stellar reputation in the industry.
Reputation, systems, and a well-focused team are the reasons that they retain so many clients.
Two specific things have pushed this client retention rate even higher:
- A team member was recently promoted to Director of People and Culture. All staff achievements are communicated to clients, and Chambers Theory has become a fantastic place to work in an industry that has a reputation for quick burnout. There’s a lot of value invested in the community of the team. Tommy likes to say that by “serving each other, we become free.” The team has that mindset every day, and that mentality allows them to maintain high retention rates with both clients and employees.
- A unique value proposition to their clients also keeps retention rates high. A large percentage of the clients they serve are military and Foreign Service workers. So, when they go overseas it’s usually for three or four years and then they come back to the area and move back into their homes. So, they close out their property management contract when they come back to Virginia, and then they re-hire their property managers when they’re reassigned again a year or two later. They’re now offering a different model of property management to those clients where they assist in the management of the home even while the homeowners are living in it. They’ll take care of bill paying and maintenance coordination and scheduling even while the property is being occupied by the owners instead of tenants.
Tommy and Chris also point out that they let go of clients who are not willing to be responsible for their properties. They want their tenants to have a good experience too, so if owners are not willing to invest in the property and take care of their home, they are willing to take on that attrition.
Keeping Property Management Clients Close
The innovative program they’ve designed for homeowners who come and go every few years is called the Home Escrow Account.
Their clients keep them as a property management partner even while they’re living in the home themselves. There’s a different fee structure; there’s no percentage of the rent collected. But, it provides a continuity of service to the property and to the owner.
This service has led to an increase in accounts not being closed when a homeowner returns from overseas.
If you’re a property management company that’s serving a large military community, this is the type of program that can drive your client retention numbers much higher. There’s a lot of overhead when you have to close and re-open an account. Why not see if there’s a way to do it better?
This program has also had an impact on the referral network at Chambers Theory. The extra level of care that’s provided makes a big difference. It’s a higher emotional need. When you know a client is coming back to live in their own home, you’re treating them and their experience differently than you would an investor who would never live in one of their properties.
This can do a lot for lifetime customer value. Imagine if you did not have to lose those owners who come back from an overseas deployment.
Client Retention and Employee Retention
An important point that sometimes gets lost is that employee retention is directly related to client retention.
Taking good care of a property management team is more likely to lead to higher satisfaction with your property management clients. It delivers consistent service and a direct connection between your clients and your employees.
In Part 2 of this conversation, we’re going to talk more about the importance of employee retention and how it serves client retention.
No one likes a cliffhanger, but we definitely want you to tune in next time so you can enjoy Part 2 of our conversation. In that episode, we’ll also touch on how they balance profits, people, and the customer experience.
Contact us at Fourandhalf if you have any questions, and we’ll see you soon for Part 2.
