Hartford Business Journal

www.HartfordBusiness.com September 5, 2016 • Hartford Business Journal 29 BIZ BOOKS Tips for winning business by focusing on consumers' emotions "A ll About Them — Grow Your Business by Focusing on Oth- ers" by Bruce Turkel (Da Capo Press, $24.99). Turkel identifies the dynamics of today's consumer succinctly: "When all products are similarly functional and acceptable, it's the way the product makes you feel, not the way it works, that matters." He speaks to the emo- tional part of the buying experience — people want to differentiate themselves. Examples: 1. The Toyota Prius versus the Honda Civic Hybrid. The two cars have almost identical fuel econo- my stats and price, yet there are close to a million more Priuses on the road than Civic Hybrids. Why? The Prius has an unmistakable design while the Civic Hybrid looks like a Civic. A Prius makes a visual statement about its owner. 2. Uber versus taxi. It's cool to call Uber; it's passé to call a cab. People also want to tell people about their experiences (especially the bad ones). The transparency of the digital world allows consumers to quickly spread their message to their contacts, and creates a domino effect as contacts share/retweet. Social media, like Facebook, LinkedIn, YouTube and Twitter, provide 24/7/365 access. Without such access, the "United Airlines Broke My Guitar" You- Tube video wouldn't have nearly 16 million views — and United wouldn't have altered its policy on damaged luggage. How does the consumer's fixation on being different affect a business? It changes the busi- ness's mindset from "Why do you like or dislike our product?" to one that asks consumers: "Who are you," "What are you passionate about," or "What's important to you?" Many of their answers can be found by tracking social media trends. The answers identify hot buttons that businesses must push to deliver "what's next." The mindset change also involves "being" the consumer. Executives seldom work through customer issues (i.e. navigating through the various customer-service menus only to be put on hold, transferred numerous times and having to provide the same infor- mation repeatedly). I doubt the CEO of AT&T would have been happy spending two hours on the phone like I did to resolve an issue involving online access to my account. The bottom line: Focusing on consumers ignites their passion for the brand/product. • • • "The Sales Boss — The Real Secret to Hiring, Training and Managing a Sales Team" by Jonathan Whistman (John Wiley & Sons, $30). Having managed sales teams for over 20 years during my corporate career, I know that sales management isn't like managing any other process in a business. In sales, no two days are alike. In order to respond quickly to the "you don't know when they're coming" requests and concerns of custom- ers and prospects, the salespeople and sup- port staff are always "on." They experience highs and lows and stop-that-do-this constantly. Whistman stresses that the role of the sales boss (SB) requires a high EQ (emotional intelligence) because the team's attitude and mental- ity fluctuates based upon the day's happenings. He sees the SB as "the thermostat, not the thermometer." As a ther- mostat, the SB monitors the "temperature" of the staff and works to smooth out their emotional peaks and valleys, and given the number of times salespeople hear "no" before hearing "yes," the valleys outnumber the peaks. A high EQ SB connects with the emo- tions of those involved and transitions their focus from "what happened" to "what was learned and what's next." The learning drives the results of "what's next." By main- taining the "even-keel" perspective, the SB gains the trust and respect of the team. To exercise EQ, the SB must be actively engaged. That doesn't mean micromanag- ing. It does mean "involvement without control" by knowing who's doing what. To become involved, the SB read- ily seeks feedback, which helps gauge "temperature" and team rhythm and drives EQ-based actions. Before reading the book, take the "Sales Boss Scorecard" (pp. 243-253). n Jim Pawlak is a nationally syndicated book reviewer. Jim Pawlak EXPERTS CORNER Hartford's investment real estate market offers opportunities By Edward Jordan H artford's investment real estate market is unique in that it tends to peak later than primary markets such as New York and Boston. At this late date in the current investment cycle, aggressive competition and highly priced proper- ties in New York and Boston are driving many realty investors to secondary markets such as Hartford and Springfield, Mass. These investors are looking for relatively undervalued proper- ties and more gener- ous returns. Unlike other mar- kets such as neighboring Boston and New York, where the potential to increase rents has driven the rapid increase in property val- ues over the past few years, investments in Hartford are often based more upon actual current cash flow at the time of acquisition. Historically, investors in Hartford have been limited in their ability to grow rents while maintaining high occupancy and low tenant turnover. This poses challenges for not only the current owner, but down the line when owners seek to sell or exchange the buildings for a profit. That said, in certain Hartford submar- kets and product types, the current invest- ment real estate fundamentals are as strong as we've seen in recent years. With the right acquisition strategy, investors may find the potential to add value by raising rents, attracting different types of tenants and improving operational efficiencies. Hartford properties in the west and south ends specifically are piquing investors' inter- est, as they border more affluent submar- kets that can support stronger rents, offer- ing investors an opportunity for increasing property values. One such property is 155-163 South Whitney Ave., an 18-unit mixed-use property in Hartford's west end, which is cur- rently on the market for $1.2 million. Despite a failed state government and concerns about Hartford job growth, key economic drivers in the city have been suc- cessful in luring young professionals and higher-demographic tenants in the central business district. Investors are attracted to markets with improving demographics and the eventual potential addition of Dunkin' Donuts Park (the Yard Goats' stadium), Hard Rock Hartford, which is projected to open in fall 2018 in the downtown north neighbor- hood, and several luxury apartment projects, including 777 Main and Front Street Lofts, are luring Millennials and others to live in the city's urban core. Also attractive to investors is that some of these projects, such as 777 Main, repurposed formerly vacant commer- cial properties for new uses, thus reducing the volume of abandoned and vacant proper- ties in Hartford. Among Hartford's strongest housing assets in the current market is Class C workforce- level housing. Investors have been competing for these properties, resulting in higher prices over the past 12 to 24 months. Demand is being driven in part by low interest rates and inves- tors are seeing vacancy rates below 5 percent. That said, there are early signs that asset values in certain Connecticut submarkets may be getting softer. With new Class A mul- tifamily development now coming online in Stamford, Norwalk and New Haven, for example, owners are faced with offering incentives and concessions to attract renters. Taken together with the continued decline in national homeownership rates, this budding oversupply of higher-end multifamily product is putting downward pressure on rents, occu- pancy and asset values. If there is a silver lining, it's that unlike the previous cycle, banks are now paying closer attention to real estate fundamentals and have started to tighten up on financial underwrit- ing and scale back on certain products such as high-leverage and interest-only financing. By requiring investors to raise more cash for an acquisition and to pay down the principal bal- ance more quickly, any continued downward trend in asset values should result in fewer distressed and bank-owned properties flood- ing the market in later years. Moving forward, the Class C multifamily mar- ket should continue to hold up strongly, as should certain classes of retail investment property. n Edward Jordan founded Northeast Private Client Group, an investment real estate firm with offices in Connecticut. Edward Jordan ▶ ▶ ' When all products are similarly functional and acceptable, it's the way the product makes you feel, not the way it works, that matters.'

• Cover