Luxury Marketing Council: “Are you leaving money on the table?”

Panel: Erin Feher, Elizabeth Suzuki, Robin Strandberg and yours truly (Photo: ADG)

I was invited by the Luxury Marketing Council to participate in a panel discussion for the second time.  The first one was “Why Can’t We Just Get Along?” about  the relationships between architects, interior designers and contractors.  The subject of this week’s very candid debate was the effects of the current recession on interior designers, architects and builders, and what business practices promote client trust, increase client spending and maximize revenues.

Once again Alf Nucifora, the chairman of the Luxury Marketing Council, moderated the conversation, this time comprised of an all female panel, which I was tickled by.  My fellow panelists were Erin Feher, Executive Editor of California Home + Design magazine, Elizabeth Suzuki, principal of Sutton Suzuki Architects and Robin Strandberg, owner of the construction company Capo Mastro Group.

Moderator Alf Nucifora and audience (Photo: ADG)

Here are some of the subjects we addressed:

  1. Communication: Clients want to feel a certain amount control over a project, and as trust has decreased it is even more important to keep them informed every step of the way and to break down the scope for easy understanding.
  2. Service: As clients feel even more in control in this buyer’s market excellent service has become more crucial than ever to compete, build confidence and to establish a successful longterm relationship.  In addition to being pro-active and managing projects efficiently panel members also mentioned the benefits of providing additional services at no cost.  Examples were having a principal at more meetings, offering to be a resource for any related questions, assisting with the selection of a new home by advising on possibilities and drawbacks, decorating for holidays, helping with personal and charity events by re-arranging furniture and setting up, or by creating floral arrangements.
  3. Teamwork: It is important to assemble a good team early by having the architect, interior designer and contractor, perhaps even a project manager, all come on board in the beginning, even if some of the players may not have as much involvement in the early stages.  Once trust has been established team members can resolve problems together without involving the client until a solution has been achieved.  Also the project will be designed with all needs addressed and to a required budget from the beginning.
  4. Pricing: Transparency and detail have become more necessary, as clients appreciate itemized costs to understand what services they are paying for.  There may be certain services they would like to exclude.  However, the general consensus was that cutting project management was not an intelligent choice.  Also billing structures have become more a topic of negotiation with clients, and it is paramount to accommodate them while remaining profitable.  It is key to have confidence in the quality of one’s firm and therefore making the client aware of the value of services provided.  It is also vital to remember that the costs of materials and running a business have not decreased.
  5. Budget: As home owners are asking for reduced budgets, while still desiring all the bells and whistles, value-engineering and managing expectations can be challenging.  Very detailed line-item budgets are requested more and more.  Honest conversations about pros as well as cons and investment value, as well as coming up with clever money-saving solutions have become more necessary than ever.
  6. Scope: More often than not projects now start on a smaller scale and only get increased later after trust and confidence have been built.
  7. Luxury Trends: Beyond the basics home owners splurge on wine cellars, rooms specifically for the man of the house, outdoor kitchens and living spaces, solar hydronics, high-end audio/visual systems and more flexible and convertible spaces.

I would love to hear your feedback on this discussion, from colleagues and home owners alike.

Cheers,

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