Commercial Real Estate Strategy Tips

Raving Fans – A New Insight About Customer Satisfaction

by Marvin Levin

In 1993, Dr. Kenneth H. Blanchard published “Raving Fans,” an important text for real estate and all other entrepreneurs. Blanchard has an important insight. He proposes that, in this millennium, a merchant needs to produce “raving fans” and not just satisfied customers.

I was reminded of Blanchard’s idea a few years ago when I visited my friend Rubin Glickman in San Francisco. Rubin had converted the old Hamms Brewery on Bryant Street to an office building. There was considerable vacancy in the South-of-Market area then (as there is now) and new tenants were not easy to come by.

One of the first things I noticed was that Rubin had installed a bicycle rack in the basement of his building and provided a dozen bicycles for tenants to use at lunchtime. He said he thought about 60% of his tenants used the bicycle rack, and this is a significant number if you are scrambling for tenants.

You can certainly see “Raving Fan” attempts in and out of the real estate industry.

• The cashier at Safeway addresses you by name and offers help to carry your groceries out to the car.
  
  
• Before starting construction of a high-rise condominium project in San Diego, Levin Menzies & Associates built an exact replica of a unit several blocks away. A prospective buyer would then have a picture of the unit that would be eventually built on site, together with views (taken from a hot air balloon) from different elevations.
  
  
• A restaurant that attracts families for dinner provides a playroom for kids while their parents are finishing their meals.

Blanchard makes the point that in the above situations customers would answer the question: “Are you a satisfied customer?” and the customer would probably say yes. That is the wrong question, says Blanchard. The right question is: “Are you a raving fan?”.

If you know of a value-added income property, please contact me.