Consumers want experiences over products, do you know why?

What does that even mean?

A recent study by Cornell University revealed that consumers prefer experiences over products. This sounds like fluffy marketing speak, but it has some simple applications in the real estate industry (and I’m not talking about baking cookies for open houses).

“The study… found that ‘experiences’ are more rewarding than ‘things’ because of the way people tend to evaluate their happiness by comparing themselves with others. For example, it is easier to feel crummy about some possession of yours if you learn that someone else has a superior version of it. “Experiences are inherently less comparative,” says one researcher, which means they tend to bring happiness regardless of other’s.”

Let’s say Marcus buys a new home at the same time as his coworker Jacqueline who has the same income and purchased a home at the same price. Marcus is invited to Jacqueline’s housewarming party and is disappointed that her home is much larger and nicer than his, so he experiences some disappointment at comparing products.

On the other hand, Marcus and Jacqueline have lunch together and haven’t seen each others’ homes and they swap tales about their home buying experience, they are exchanging personal connections with the process and their memories that are unique. Marcus talks about how he and his wife looked at houses for months and about the one open house they went to that reminded them of a scene from their favorite romantic movie while Jacqueline recounts the open house they went to that had a dead squirrel under the kitchen sink which had their kids squealing with laughter.

People own their experiences

“According to the study, experiences are so effective at making us happy because we truly ‘own’ them in that they become integrated into our characters and help shape our personalities. Material goods, on the other hand, can really only be ‘possessed’ and rarely become a part of us in any meaningful way. Also, things we buy are subject to material degradation and devaluation, not to mention a gradual lessening in our appreciation for them. In contrast, experiences are transformed into memories, and even bad ones can be appreciated later on down the line.”

In the Marcus and Jacqueline story above, Jacqueline’s family experienced a disgusting dead animal in an open house, but it was memorable and they ended up buying the home because it was perfect for them AND their buyer’s agent was embarrassed, used her cardigan to wrap up the dead squirrel, took it into the back yard, called the listing agent to let him know what happened, sacrificed her cardigan as the squirrel’s burial ground and offered to send Jacqueline and her family to lunch on her while she tried to find some candles and spray so they could start the tour again. The animal was no big deal to Jacqueline, but the agent going the extra mile not only impressed them, but kept them in the home for an extended period of time and gave them a unique story to retell.

Granted, unhappy people experience life through poo colored glasses, most normal people will reflect on memories fondly because they’re unique and their own.

So what’s the big secret?

Knowing that consumers want experiences over products means that an automated purchase process will continue to be inferior to a guided, personal process. The preference for experience means that consumers are paying attention to how you answer the phone, what you say when they’re in your car, where you stand when you give a tour, how friendly you are when you call to follow up, what your demeanor is when you attend their closing and how non-salesly you are when they invite you to their housewarming party. The preference means that clients care less about what your listing presentation looks like and more about how you present it, how much feedback you give them about tours of their home, how often you check in with them to update them of other listings that have come online, and how available you are and what special touch you provide.

The big secret is that there’s no big secret. Your website should emphasize experience over product so people can meander and learn all types of information and get to know you. You should answer the phone, respond to email and go above and beyond in all ways possible. By doing your very best or even half of your very best, the sad truth is that you’re providing a superior real estate experience over most of your competitors who take 36 hours to call people back and are never heard from after a contract is signed.

The big secret is that you have to make paths to an experience possible. If people like swimming and that’s what makes them happy, builders should make sure their subdivisions have community pools so the experience can be fulfilled. If people feel most satisfied by knowing the sales history of a home, make it available to them so their experience can be fulfilled. If the real estate industry created less obstacles and more paths, consumers could focus on the experience of buying (which is a more lasting value proposition for the industry) rather than the actual product. Instead of running out of the house and stamping it as unacceptable, Jacqueline’s agent cleared a path and ended up giving them a lifelong memory (albeit a gross and hilarious one).

So that’s it- make memories, because that’s what are shared over dinner about the home buying experience in nine years, not what type of granite the counters are… appreciation for memories grows over time while appreciation for physical possessions declines.