The relationship between the landlord and tenant at a commercial building is quintessentially business-to-business (B2B). The business of operating a building requires generating revenue, and that means attracting rent-paying tenants. Similarly, tenant occupiers need space for their teams to meet, collaborate, and do the work that fulfills each one’s corporate mission.
Historically for occupiers, location was always the first decision driver, followed by efficiency—getting the most people in the least amount of square footage at the lowest rental rate. For both tenant and landlord, the value was all about the transaction.
Well, things have changed. For tenants, space is no longer just a place to warehouse people while they work. More and more, knowledge work is about creativity and collaboration, not just productivity. And with low unemployment, the competition for talent is fierce. Companies are therefore using every tool at their disposal to attract and enable high-quality talent, including the office space itself. Today, the workplace experience is as much a part of a lease’s value as the financial terms of the deal.
While commercial occupancy is still a B2B relationship at heart, the emphasis on the individual experience means it is acting a lot more like a B2C (business-to-customer) relationship than ever before. Tenants now expect their employees to have the same types of personalized, direct, and convenient customer experiences at work that they do as consumers when they travel, dine out, or shop. To provide this, commercial property management teams need to shift their thinking from offering a B2B product to delivering a B2C experience. Here are a few pages they can pull from the script of successful B2C companies.
- Treat each individual tenant employee as a customer. Property managers have traditionally spent most of their time and effort on either the person who signed the lease or 1-2 designated administrative contacts at each tenant company. What happened to everyone else always mattered, but mostly to the extent that an issue bubbled up through one of those two personas. Today, effective CRE professionals understand, anticipate, and enhance the experience of every individual working in the building. A good analogy is the way a hotel staff focuses on the details that impact each person’s stay.
- Offer personal, “creature comfort” amenities. Tenant employees expect more than just the basic corporate amenities. For example, while a conference facility is nice for business meetings, a comfortable sitting area and free, strong Wi-Fi will be more valuable to a greater percentage of occupants. Think back to hotels for a moment. If one hotel offers a pool and a spa, but an equally priced hotel one block away does not, which hotel will people stay in? The same is true for the workplace. To serve tenants competing for talent, consider offerings with broad appeal.
- Communicate in the way customers prefer. The B2C shift has huge implications for communication. To reach more people, building management teams will need new methods. Simply posting something to a website and hoping tenants find it is not a viable solution anymore, and neither is relying on single points of contact to relay information. Think about an airline. If a flight is delayed, passengers need to know immediately. Airlines have gotten much better at getting the word out through text and other messaging channels. It’s an effective model that buildings can replicate. After all, the number one rule for communicating with customers is meeting them where they are—mainly, that means text and messaging apps.
- Tell customers what they want to know. When the audience changes, so must the content. Sure, tenant employees care about lobby construction and appreciation events, but they also want to know about things that impacts their day-to-day workplace experience. For example, have any new food options opened up in the neighborhood? Does the city have a summer calendar of events? What about news regarding road construction or transit schedules? All this contributes to how people experience working at a commercial building. The better the management team communicates about things like this, the better that experience will be.
- Hire for B2C skills. It should be clear by now that property teams need to change the profile they are hiring for if they want to keep up with the B2C shift in the industry. This means looking for people who are equipped with a customer-centric way of thinking about service. Some of them may come from the hospitality or residential sectors of the industry. Others may be even more non-traditional for CRE, like financial advisors, health and fitness providers, or even Uber drivers. And of course many existing CRE professionals will be more than ready to expand their skillset or further develop one they already have. The bottom line is that the industry needs a commitment to B2C talent.
The fundamental goals for commercial assets—high rents and high occupancy—are the same as they have always been. But there are now different paths to achieving these goals. A purely transactional B2B mindset won’t deliver the level of customer service required to make modern commercial buildings competitive in the market. There are still a lot of unknowns about what CRE will look like as it transitions to a more B2C industry, but these five items will help lay the foundation for success.
Our latest research, The Tenant Experience Gap Report, defines what amenities tenants want, how they want to communicate and what information they want to receive from property teams. This is a great first step into creating strong and loyal B2C relationships between landlord and tenants. Read the full report here.