Read on as we share how to identify and cater to luxury clients plus our top tips for appealing to luxury clientele and building your pipeline with best-fits.
What Does It Mean to Be a Luxury Client?
To attract a luxury client, it’s a good idea to identify who that client is. Luxury clients tend to have higher budgets, but there are other factors that also characterize this segment. Let’s first take a look at how much luxury clients spend on bathroom and kitchen remodels in the top 10 markets in the U.S.
This chart shows spending on bathroom remodels in the top 5% for their market, as well as for the top 0.5% of the market, according to the 2018 and 2019 U.S. Houzz & Home studies.
At the top 5% of the market, homeowners remodeling bathrooms in Chicago spent $40,000 on their projects. Those at the top 0.5% of the Chicago market spent about 11 times that, at $450,000.
In Los Angeles, homeowners at the top 5% spent $50,000, while those at the top 0.5% spent six times as much, or $300,000.
For kitchens, homeowners remodeling in Houston spent $90,000 at the top 5% of the market and about four times that, or $370,000, at the top 0.5%. Houston had the highest top 0.5% spend level of any city.
Homeowners in San Francisco spent $157,000 at the top 5% of the market and nearly twice that, $350,000, at the top 0.5%.
In addition to spending a lot on their projects, luxury clients tend to have higher expectations for the work as well as the experience they get during the process. Talking with CLB builders, luxury clients:
1. You’re only as good as your last photographed job.
When potential clients are scanning your work on Houzz, your website, or social media photos really matter. Featuring your gorgeous, finished projects well is vital to attracting new clients, but knowing how to best create and display gorgeous photos that do justice to your hard work can be a challenge.
2. Luxury clients are buying you as part of the whole package.
Your online reputation matters. More than 80% of decisions to hire a builder involve checking their online reviews. Out-pacing your competition in 5-star reviews can determine whether or not you are hired for a job, and will impact your search rankings—and business— on Google, Houzz, Facebook and Yelp.
3. Good enough isn’t luxury.
Everything for luxury clients — from cabinets to tile layout to electrical installation — needs to be customized and special. Just standard or just OK isn’t going to cut it at this end of the market. You will also need to provide high touch service.
High-end clients may have especially strong opinions, and they may also like to shop. With budget not a major constraint, they may be more likely than lower-end clients to purchase items for the project that may or may not work with the design. Some luxury clients may also want to comparison shop the products that you’re proposing. If they come up with cheaper alternatives, you may need to let them purchase products themselves.
All this adds up to the fact that with a luxury project — though you probably will be able to make something beautiful and unique — as a luxury builder, you may not feel like you have a blank check and carte blanche to execute your vision.
Often, clients in the luxury realm have gotten there because they’ve been smart about their money. They may want to be relatively involved in the project to make sure they’re getting not only a beautiful result, but also a good value.
4. Details help create that luxury experience.
In addition to creating personalized, custom projects for luxury clients, it is essential to pay attention to service details that guarantee a 5-Star Experience for all of your clients.
For instance, hosting an annual event for your clients is a great way to show appreciation for your clients and how much your value their business. One CLB member hosts a client appreciation event every year by gathering clients from the past and present and treating them to a high-end dinner. While this annual experience is a significant marketing expense and experience, it keeps the luxury feel going and can keep you top-of-mind when a past or present client is asked to review their experience with you OR even recommend your services to a family or friend.
You can also deliver a luxury experience by sending handwritten notes to create and maintain key relationships. Did you know that good old-fashioned thank you notes are used by businesses as a growth and retention tool and that 64% of Americans prefer a handwritten note over receiving an email?
While sending thank you notes makes you feel connected with those around you, it’s also a unique way of helping you build and maintain key relationships with clients and colleagues by keeping you top-of-mind and showing you don’t take their attention for granted.
Featuring your gorgeous, finished projects well is vital to attracting new clients, but knowing how to best create and display gorgeous photos that do justice to your hard work can be a challenge. Following our imagery guide will ensure that your images and branding look their best everywhere, in print and online.
The Certified Luxury Builders Network leads luxury builders to greatness. Since 2016 CLB Network and builders across the nation with annual sales ranging from $5M - $50M have worked together to deliver a 5-Star experience and become market-leaders. Working with one great company at a time, CLB gives builders the tools, training, and support to achieve success in Quality, Profit, and Pipeline freeing leadership to work on—not in—their business.
We're here to help builders. Experience and expertise is just a click away. Contact us today to see how your business measures up to our builders' benchmark, learn what "GREAT" looks like, and see how CLB can take your business to the next level.