What’s the goal of every business or investment? At its core, there are usually two things: to offer a product or service that a founder is passionate about through which they feel they can make a difference, and to make money. In short, you care about customer success.
It’s really that simple, but executing is the hard part.
Even successful companies are constantly looking for ways to make more money. Call it greed, call it efficiency, call it scaling — call it whatever you want, but every business is constantly in search of greater revenue. And once their external revenue streams have plateaued, most businesses turn inward. For commercial real estate landlords and other property owners and managers, that “business” is leasing the buildings they own.
So what if we told you there’s a simple way to make more money (or, as a landlord might say, lower your churn rate and increase tenant retention)?
Let’s dive in and take a closer look at a key to unlocking potential revenue: happiness.
Happier Employees Are More Productive
Work hasn’t always been a source of “happiness,” per se — while some people find happiness from their work, for many it’s a means to the other things in life that make them happy. But to the credit of the budding “younger” generations today, that’s changing. And why shouldn’t it? After all, we spend nearly half our waking hours working.
Before the older or grumpier readers guffaw at the notion that you should or even need to be happy at work though, consider this: recent studies from, among others, the University of Warwick and Oxford University, have shown that happier employees are 12%–13% more productive than their average peers, and unhappy employees on average are 10% less productive than average. Per one study, the lack of engagement and efficiency costs U.S. companies approximately $450–$550 billion every year.
That number only accounts for losses from unhappy employees. Factor in a boost above the norm for happier employees, and that income potential would skyrocket even further.
“We find that human happiness has large and positive causal effects on productivity,” the Warwick research team said. “Positive emotions appear to invigorate human beings.”
Don’t know what the most effective ways are to make employees happier? Don’t sweat it — doing something at all generally makes a difference on its own.
Professor Andrew Oswald, one of three researchers who led the Warwick study, noted that “companies like Google have invested more in employee support and employee satisfaction has risen as a result. For Google, it rose by 37 percent; they know what they are talking about.
“Under scientifically controlled conditions, making workers happier really pays off.”
But it’s not just employee productivity that sees a boost; overall company health improves, too.
Another surefire way to increase the value and output of a business? Retaining your best employees which, per a Gallup poll, is also made easier when they are happy.
As a landlord, your tenants and their employees are your customers. So if you want greater retention and lower churn rates, customer success is the answer.
Shawn Anchor, author of The Happiness Advantage, put it best: “happiness leads to greater levels of profit.”
How Do You Make Employees Happy?
The age-old question: what do people truly want?
While fair compensation and regular feedback, raises, and bonuses certainly weigh heavily on employee satisfaction, there’s one very human element that matters above all else: appreciation.
According to a survey from compensation data and software provider PayScale, feeling appreciated is “the #1 thing employees crave,” topping other major factors such as good communication, potential career development, pay, and the company’s future outlook.
“Appreciation is key,” they wrote. “An employee feeling appreciated or unappreciated moves the needle on satisfaction more than any other variable.”
“An employee might say they want more money,” Nero said, “but what they need is to be recognized.”
I’m a CRE Landlord or Property Manager. Why Do I Care?
It’s a great question. Far be it for a landlord to take concern about a company’s success and growth as long as they can pay their rent and re-sign their lease. But while you’re certainly not involved in the business operations of your tenants, consider the bigger picture from your 10,000-foot view.
Landlords have always looked at their properties as a draw for tenants, and their capital expenditure — a facelift for a lobby, perhaps, or bigger and brighter windows — has reflected that. The goal is always to keep your tenants happy, right?
What might seem like a small change can have a major impact as the ripple effect takes place: Individual employees are happier at work on a daily basis which, as we’ve shown, means their production and efficiency goes up.
This effect compounds and spreads like wildfire. As employees succeed and grow, so to do the companies they work for. The same can be said about the relationship between commercial real estate owners and their tenants: Customer success (tenants) is your success.
Not only are your building tenants signing new leases, they’re potentially paying greater premiums to stay where they already are. And as your successful tenant grows more successful and notable, word of mouth spreads: your commercial office building is the place to be — it’s a breeding ground for success. What better customer success testimonial is that?
In time, just as your tenant company’s success compounded, so does yours. Revenue increases, and a building’s valuation rises with it.
Maybe we’re oversimplifying, but you can see where the map of investing in the happiness and experience of the people who work in your buildings is going. Investing in your tenants and their employees makes an impact and pays major dividends.
But do those tenants and employees actually care? In short: yes, especially because a majority of them are or soon will be millennials or younger.
Everything is about experiences.
If you haven’t heard, millennials — the largest generation in history — crave and are loyal to two major things: experiences and convenience. So it stands to reason that this generation (who as of 2018 took over the majority spending power from the Baby Boomer generation and is projected to spend approximately $1.4 trillion in 2020) is an audience you want to cater to.
Everything tenant experience (TeX) technology does caters to the lifestyle millennials have brought to the forefront of our society. From the simple convenience of ordering lunch ahead and skipping the line, to being notified about programming in their building or a cool event nearby to break up the day, to visiting a doctor or specialist that has come on-site to their building for the day for routine checkups, TeX contributes to making days a little easier, a little better, and reminding people their efforts don’t go unnoticed.
Be a Leader in Tenant Experience
To us, tenant experience is the same as customer success. We want our clients to be successful and do everything in our power to make that happen. If we can make even a small positive impact on the people who inhabit the buildings our clients own or manage on a daily basis, we’re doing something right.
While we’re not going to drag on about all the things we can do, we will tell you this: our platform is a service that caters to the needs of your tenants. We offer convenience, community, and a sense of inclusion. All three go a long way toward every day workers feeling appreciated and — you guessed it — happier.
And yes, those happier tenants most often lead to greater profits, for themselves, for their companies, and for you.
In fact, new proprietary data coming in 2020 from HqO shows that an investment in our tenant experience platform delivers a significant ROI. We won’t spoil the data any further, so be sure to check back here often for the latest news and insights from our team.
Until then? Give us a call or shoot us an email. Schedule a demo and let us show you how we’ve made an impact for others. You owe it to your tenants, and their happiness, to do so.