Get an international perspective on marketing and selling new homes. And great advice on how to approach (and how not to approach) a digital transformation.
Nicole Godfrey is Global President of Runway. Runway is recognized as the leading software solution provider for the Australian builder and property development sector. Nicole relocated to Dallas, Texas with company founder and husband, Rowan Kelly last year to establish a branch office and is working with builders and developers nationally to streamline back-end operations and create cutting edge front-end consumer journeys. Runway employs more than 45 technicians and developers across Australia, India and the USA.
Many thanks to our partners at the University of Denver for their editing and post-production talents, specifically Lija Miller and Lisette Zamora-Galarza.
The University of Denver Franklin L. Burns School of Real Estate and Construction Management, teaches the full life cycle of the built environment. From integrated project leadership skills to a cohesive understanding of the built environment ––experience the only school of its kind!
"Upbeat Party" is brought to you by Scott Holmes, songwriter from Free Music Archive.
Eric Holt (00:06):
You're listening to the housing innovation Alliance podcast in partnership with the university of Denver's Franklin L burns school of real estate and construction management. The housing innovation Alliance is a nationwide community of game changers driving the future of home delivery through crowd accelerated innovation. We represent thought leaders from dirt to dweller with a focus on the production builders business environment.
Hi, this is Dennis Steigerwalt, president of that housing innovation Alliance, and you're listening to our podcast series. I'm joined today by Nicole Godfrey global president of runway. How are you doing today, Nicole? I'm good, Dennis. How are you? Yeah, very well. Thank you. I appreciate you joining us today. I'm really excited to talk to you a bit about your experience working in kind of the global home building industry. Um, and, and talk a bit about how you're helping some of your clients work through a digital transformation process, because it really builds on a lot of the story that we've been telling within our community. As we see that, uh, you know, digital transformation is, or digitization is something that many of these organizations are going to face over the next five years. And some have described it as the difference between let's say life or death for their company yet only a very small fraction of those organizations are prepared for that. So I think you'll have a lot to add to that story and a lot to just share with our community as we get into it.
Speaker 2 (01:24):
Yeah, for sure. So I can give you a little bit of background on, on runway to start with. So runway is a platform that has been in existence since 1997 when digital, and it was in the cloud back then. And, you know, at that time, a lot of people didn't trust the internet didn't trust the cloud. So I've seen a lot over, over that period. The company was started by my husband, Brian Kelly in Melbourne Australia. And, uh, we also have a production facility in Bangalore in India. And about two years ago, I started watching the U S market quite keenly. Um, out our apps are primarily used by builders and developers in Australia to solve the problems around rapidly creating home and land packages. So the ability to find a lot, find a home control, sort of lot fit a monotony rules, design guidelines that sort of seem to rapidly bring about new home options for consumers.
Speaker 2 (02:21):
So I'd started watching the U S markets subscribing to everything that I could. And last February, my husband and I decided to, um, do a six week trip and I, through the power of LinkedIn lined up a heap of, um, of meetings with captains of industry and landed in Houston in, uh, in Texas and was fortunate enough. My very first meeting was with Heath Melton at Howard Hughes corporation, who is now a client. And, um, my first meeting in Dallas was with Hillwood who are now a client. And what I discovered through that process is that the lack of tech in home-building in terms of the processes of getting product to consumers and getting product to market was, was drastically behind anything that I had really anticipated. There was still a lot of spreadsheets and Dropbox and emails and, um, paper plats and things like that. So after that six week trip went back to Melbourne and did some hard thinking about what that opportunity meant for our business. And for me personally, and I'm packed up the dogs and moved to Dallas and, um, just, uh, getting to my one year anniversary of watching the business here.
Speaker 1 (03:38):
Exciting. Well, so you've been here for a year. Can you just tell us some stories of, you know, maybe embellished a little bit on some of the things that you've experienced, some of the, the hurdles that you think we're facing when it comes to digital transformation within our organizations and within our industry?
Speaker 2 (03:53):
I think there are a few, um, a few contributing factors. I think there, there are a few, few factors. One is, and I say this very gently, my perception and my experience in the age of a lot of the decision makers at the helm of these companies, that they're not as comfortable with tech as perhaps their younger counterparts. And I I'm often seeing that in terms of when, where I'm pitching into an organization, it's usually the 30 something or the 40 something, that's the champion and he's, you know, pushing up when, so I think that's a factor. The second factor I would say is the lot take down process. So some developers view their customer as the builder and the builder will then panel out manually when they don't need to, if they are using our products, they manually determine what home is going to go on the lot.
Speaker 2 (04:50):
So the consumer then doesn't have choice, but because that's sort of decided that that's going to be that home. That's, that's the spec, that's what they building with these colors, somebody manually making those decisions. They've always done it that way. That's somebody's job that they just haven't reached for giving the consumer options. So there's a kind of, you get what you get and, you know, no one gets upset because that's what you're, that's what you're getting. The third I would say is that because a developer or a builder will build out in a section of a community, and again, he's not providing those options there. They're not reaching for the ability to rapidly create new home options. They're not reaching to produce dynamic brochures on the fly to produce, you know, new home estimates on the fly. They haven't reached for it until now. And I think what people are finding now that we're all at home and people are online a lot more is that, you know, I saw a funny meme on LinkedIn that said, you know, who, who initiated your digital transformation?
Speaker 2 (05:56):
Was it your marketing manager, your it manager, or COVID-19? I think that that's forcing people in it, a new client that I'm working with at the moment has said, you know, every couple of years it would come up that we need to do something with our website and you know, I'd go out and I'd look for options and I'd go back to my division president and then it would be not the website's fine. But whereas now it's like, wow, we really need to do something about the state of our website. If I can give you a bit of background around how builders and developers work together in Australia. And one of the reasons why our, our apps is so fit, if I can call it, that is that there's no lot take down for starters. So every builder is going out to every developer to try and figure out what land is available.
Speaker 2 (06:44):
And then using our software, they will run a process to say every block of land, every house, every house combination, every elevation combination, every color combination. Tell me what I can have. And then they might end up with thousands of home and land packages. Then they'll put those best ones on there, on their website, on the equivalent of MLS realtors, Zillow, and they're purely lead generation tools. So then when a customer inquires about that package or goes down to the sales center and says, I want that home and land package, the builder will say, that's great. I'll take your, your deposit or earnest money as you call it here. And then you have to go off to the developer and do a separate contract. So they're not, they're not related at all. But then the problem becomes that if another builder has a package on that light, how do they know that lot is now sold? And what our application also allows people to do is to collaborate online so they can send homes. They can send lots to each other. So, you know, that's one of the ways we manage digitally manage, take down as well. But yeah, I think that the tie-down process, the career stage of people at the helmet of some of these organizations and the lack of giving consumers more options has meant there hasn't been that pressing need to really look at doing things digitally.
Speaker 1 (08:10):
Yeah, I think it comes, it sounds like it comes back to you, like you said, at the beginning of really a comfort level, having a certain comfort level with, uh, accepting the measured risks of adopting a new technology like this and, and evaluating how you actually roll it out within your organization and into your customer base. And I think that you're right then that has ripple effects throughout the entire process. So, and as we look towards consumers moving more towards an online purchasing environment, or at least, you know, really trying to get to the point where they go in as educated as possible into the purchase process, they expect a better experience. Right. And, and, um, that's something, you know, as we interact with all kinds of other products, whether it be a, you know, a car, a wardrobe, or, you know, an remodel process, we have that at our fingertips different apps. I think, you know, providing them, providing us as buyers with those resources is incredibly important because that's where we're going to continue to see more and more pool from the market and more desire. So talk to me a little bit about how this enhances the overall experience for the consumer and maybe a little bit about the journey that the organization itself has to go on to make that work.
Speaker 2 (09:17):
Yeah, absolutely. So what we do is we take the plat and we, um, our AI, you know, um, run my inventory platform actually reads the plat, um, rates, the setbacks easements, and so forth. We then look at loading design guidelines and not ne covenant rules. We then load in all of the, the home plans. And we also create a, a bird's eye lot fi image of the shape of the house. So then when the consumer is on a website or a touch screen, or the sales counselors sitting in a, in a model home with a prospect, you can either start by selecting a lot you're interested in, or you can start by selecting a home design that you're interested in. And if you select a lot, it runs all of the checks in the background against monotony, design guidelines, lot fit site coverage, whatever it might be.
Speaker 2 (10:08):
And it will present to you the homes that are compatible with that lot. You can then select that design. It will then filter out any elevations based on the elevation itself or the colors within that elevation. So you're only presented with those that are compatible. You can then go ahead and select your internal colors, or it might be a modification to the home, and then you create your new home and it will automatically do the lot fit for you as well. So I know with Pulte who we're working with out of Austin, they were waiting up to two weeks for a lot fit to come back from their engineers and paying, you know, close to $200 and now it's automated for them. And you can then print off a dynamic brochure. Then in there, uh, you can request online chat, uh, or if you are so inclined and it's a, it's a hot, hot lot or a hot community, you can place a deposit online. And that will automatically then Mark, the loan is on hold. So somebody else can't buy it, but it is a hundred percent foolproof. You cannot make a mistake.
Speaker 1 (11:14):
So, you know, from a, from a consumer perspective, it obviously removes a lot of friction from the process. I mean, we were already going through a pretty important time in our life when we're going to make this very large investment in a new home can be, it should be enjoyable, but it can be stressful at times, right. And, and making sure that you have kind of clear line of sight to your point of what your options are as quickly as possible. And then knowing that that's being communicated throughout the organization, the way that you want it to be and the way the organization needs it to be as quickly as possible, the time saving element of that seems to be pretty incredible as well. So now I, as a buyer, you know, I start off my journey in a much better position than I might have otherwise. And I think that's, you know, that's incredibly important cause that's a lot of feedback that we will typically see our community.
Speaker 2 (11:54):
One of the other things that, um, it allows a consumer to do is to get a visual on the homes that are going to be their neighbors as well. So is there a single story or a two story home next door? You know, what, what do the quality of the homes look like? So they can start to really see themselves in that neighborhood. And we can integrate with, you know, street view and three-day tours and walking around the neighborhood and so forth. But it's about getting the consumer closer to really seeing themselves in that home consumers need certainty. So that gives them the certainty and the confidence and it gives them what they want when they wanted it.
Speaker 1 (12:32):
Right. No, absolutely. And then, yeah, as we said, that's something that we're all kind of expecting nowadays. Right? We just get so used to it's ready now that as soon as it's not, we get a bit frustrated. So I think that this, and with something as important, as we said about as a home, this is, this is a great solution. So you mentioned some of the working relationships that you have now and some of the problems that they're solving with it, with these kind of digital tool sets. Can you talk to us a little bit about, you know, what else you're seeing, what other problems you're able to solve directly for some of your clients today, um, or that these tool sets themselves can solve and how that's playing out inside different, you know, different examples.
Speaker 2 (13:07):
Yeah. So the, the, the way in which we're working with our clients, you know, is quite diverse and because it solves a lot of problems and, you know, you can start with one component and then move to another. But if I think about the work we're doing with Perry homes, you said a Texas based builder, they've got offices in Dallas, San Antonio, Houston, when I first, um, met with their executive VP, he's an comes from a tech background himself. So I was in, I was in luck there, he went and got one of the paper plants for their community. And he showed me that what they were doing. And I've seen this with other builders and national builders as well. So is that they would using colored highlighter and pencils. And that would write which home was going to go on a, on a lot and what elevation.
Speaker 2 (13:58):
And then if a different house sold next door that would then have to rub that out and change the house. You can imagine the mess that, that this thing looked like, but it was not only the fact that, you know, it was, it was messy and error prone. But if the person who, um, looked after that was a way there was no one else who could just pick up that work. So someone in another office couldn't pick up that that works. So what we've done is we've actually digitize their plats. This means that anyone from any office can log in and keep working with the stats department and so forth. That means that everybody's got complete visibility all the time about, you know, the status of that community. And from a sales perspective, it allows the sales consultants now to go in and do that, what I described as a consumer journey.
Speaker 2 (14:47):
But if, because the plat is a living, breathing real time thing, if, if a customer comes into that community and wants to put another home on that lot, even though it had been earmarked for another home, the sales consultant has the ability to do that and produce a brochure with a lot fit immediately. So the problem we're solving is if a consumer comes in on the weekend and wants a different home on a lot with a lot fit, they couldn't do that previously. And they've got cost savings in terms of the price of, of Lafayette's, you know, they're getting the consumer closer to making a purchase way, way faster. And the sales consultants have got a great sales tool.
Speaker 1 (15:25):
Yeah. So you can see, there's certainly a lot of added, added value here. And one of the things that you mentioned early on in the conversation is really to make something like this work, it takes buy in at the highest levels of the organization, because it's not necessarily going to be an easy journey and it's going to be something that is going to take time and patience to, to roll out, you know, can you share with our community, what are some of the first steps as they approach kind of moving in this direction, more digitization within their organization, more connectivity amongst stakeholders, how should they be thinking about that? Which what's the first move
Speaker 2 (15:55):
A lot of people consider this debate, purely a sales and marketing function, but it's not certainly sales and marketing a heavily involved. But if you think about it, three things need to work for this to come to fruition. And first is full buy in across all departments. I'm working with certainly VPs, I'm working with marketing people, I'm working with land development, people estimating. So if you think of all of the people who are involved with getting a home to market, they all need to be on board and understand that there are going to be some internal shifts and that things are going to be done differently. And some people really resist change. Some people sort of say, well, what's my job going to be now. I'm, I'm the person who makes brochures and they might be redeployed to do something way more interesting than, you know, with PDF tools all day.
Speaker 2 (16:48):
This is going to be automated now, but everybody needs to be on board. And sort of where we go from there is we map out what we like to call the low hanging fruit in terms of what are the things that we can get wins on quite quickly. And then the more laborious task is for an organization to get its digital assets. In order. I still say on, on websites, spec, home listings, where there's a, a portaloo out the front, you know, that's not going to work. We need to get good, good renders. Uh, often people don't know where to go about their organization in terms of getting all of the home dimensions ready. So we've done hundreds and hundreds of implementations over the years, and we follow a very strict implementation process. We'd like to get everyone comfortable by providing session agendas for requirements meetings who needs to attend what they need to bring to those sessions.
Speaker 2 (17:44):
And a lot of guidance around getting those assets ready, getting site plans, ready, getting the detailed information off the digital plats. Now I'm really just talking from an internal perspective here, but then of course, with companies like how would use in Hillwood, there's also that additional step of getting the builders on board and what we've found most successful with our developer clients is to actually present to the builder team, the benefits that they're going to get by being in a community where our tools are presence. So that's things like the consumer journey where they only say that their own homes and can produce packages and flyers and lot fits for their customers on the flight. Our developer clients are sharing all of the website and consumer journey metrics with the builders. So the builders know which homes people are looking at. What are their favorite homes?
Speaker 2 (18:37):
Are they taking three day tours? You know, how long are they spending on, on site? Are they downloading brochures? So there's a lot of value with the, with the builder, whereas historically, or certainly when I first arrived, if I was presenting to a developer, they'd say, well, that's all great, but how am I going to get my builders on board? There'll be resistance. But now we're finding that it's, it's totally the opposite. And I was watching enough to see it on the panel with a webinar, with a couple of our clients and builders who use our tools, who said, no, this is the, this is the expected level of consumer and sales experience. Now on, in any master plan community, this is a new standard.
Speaker 1 (19:18):
All right, well, so you have this, you have this very well laid out framework and a process for working with your, your clients and your partners here. I'm kind of curious, what are, are there any common traps that we need to be aware of that we should avoid when we're discussing this internally, before we make the move of calling yourself or a company like yours?
Speaker 2 (19:35):
Uh, I think that the, the company needs to be ready to really embrace change and it needs to be communicated to the company as a home. The other challenge can be around getting all of the, the dimensions and, and having a single source of truth for all of your home and land inventory as we do that migration process to runway inventory. And the other thing I'd say, and I think it's true of any major project, give, give it the time and you know, that it deserves. And also a project manager who, who has the authority to execute the project, uh, in a timely manner. So it typically is going to be somebody who has to run around to a lot of different departments or different builders, and they need to be esteemed so that they can get those things done. Um, but we certainly try to, um, make the process as smooth as, as possible. And as I say, we've done it lots of times before. And if there are issues with, you know, images or plats, we do, as I say, have our team in Bangalore who are able to take that pain away from internal teams as well.
Speaker 1 (20:43):
Okay. Now I think that, again, it comes back to it. This is it's all where we need to move towards. Right. There's so much that can be achieved, but you're, you know, you're right. We need to kind of, one of the things is, look at the organizations I've worked with in the past that you kind of got to be willing to get your house in order first. Right. And it's going to reveal some, some, some efficiencies that you have to be willing to stomach to get over. Right. So it's kind of, there's a, there's a lot of, a lot of gaps you're going to find in your own organization as you're going through this process. And, and it's, that's just part of the exercise, it's the path to betterment and organizational improvement. So I really appreciate you sharing everything you've shared now about your experience working here in the U S for the past year and kind of what you've brought into it from, from your work in Australia, curious to switch gears a little bit and get more on the personal side. Tell us a little bit about what you love about the industry, or what pulls you in.
Speaker 2 (21:31):
There's a lot that I love about the industry. I really, really enjoy learning about my client's businesses and their challenges. And, you know, I just see ability to look at something and go, well, I know how much I can do for you, um, that I can make you happy. I love that it's an industry where they're, placemaking, they're making homes for people, and that is such a big responsibility and, um, and a privilege, you know, to do that for someone, I love that there are just always so many, uh, opportunities for improvement. And I love working with people that are passionate about what they do as well. And I'm very fortunate with the, with the clients that I have, but probably the most fun for me is when I'm first learning about an organization and you know about the projects they're doing and what their challenges are and how we can, we can assist them.
Speaker 1 (22:26):
Yeah, no. Awesome. I think, you know, you certainly picked, uh, an industry to find a group of a group of people or teams that are passionate about solving problems for families. I mean, this is certainly the, one of the, one of the ones at the top and, and everybody in our community certainly lives in breeds that as well. And it's, it's exciting to have you as part of that community, as well as we wrap things up a little bit, what, what inspires you day to day? So we know that what pulls you into the industry, but are there certain actions or activities that you see from within your team or from that you observe in the field and then maybe even pivot a little bit into some, some motivation for our community. What are some words to live by?
Speaker 2 (23:00):
I, I'm very, very fortunate to have an amazing, happy team, our, our end day team, that the fact that they have built this application is, is amazing. Uh, even though we're in three different locations, everybody catches up personally and professionally every day, they're just a fantastic group of committed people. And they really do spur me on every day and, you know, I'm there, I'm there for them. And in terms of, did you say words to live by? I have to, and I believe that they are my own, one of them is I've been saying for probably 30 years in it and it's, I'll give it a go. Somebody says, do you want to try something? I'll just, and my friends still joke at me, they'll say, Oh, she'll give it a go because always want to be pushing myself and trying new things and remaining curious. Uh, and my other saying, and some of my staff here have, uh, have adopted this one is as well is relaxing to it because sometimes there's nothing you can do. You can't always control everything. You just have to go with the flow and, you know, you can only control your mind and how you respond to things. So if you know, I'm feeling a bit uncomfortable or just kind of say to myself, just relaxing into it.
Speaker 1 (24:16):
Oh, that's fantastic. I, I like both of those, but the last one is something I'll definitely take with me. Well, Nicole, this is, this has been great, really appreciate taking the time out of your day to, to introduce us to it, to yourself, to runway, and to kind of share your perspective on the digital transformation, right, where she's taking, we'll connect people with our community, to you as they reach out to us and look forward to participate in some of our events.
Speaker 2 (24:38):
I'd love to. Thanks, Dennis.
Eric Holt (24:39):
All right. Thank you. On behalf of the housing innovation Alliance and the university of Denver, this is dr. Eric Holt. Thank you for being part of our journey. This is where innovation calls home.