Tenant referencing was one the first parts of the lettings customer journey to move online. Developments in KYC and customer data made the process faster, simpler and more cost effective than ever before. This was a big advantage for landlords who benefited from a low cost, high value service. Yet it has become increasingly competitive over time. Suppliers struggle to differentiate with low barriers to market allowing new entrants to make it increasingly price competitive. Rather than participate in this race to the bottom, which erodes margins and places the emphasis solely on operational efficiency, the more strategic move for these businesses is to utilise their unique position in the lettings journey. By deploying new sources of data to reduce new risks, referencing agencies can drive differentiation, increase customer value and create new streams of revenue that rebuilds margin.
The referencing advantage
Tenant referencing takes place only once an offer has been accepted and all parties wish to move forward. This makes referencing agencies amongst the first to know how many tenants are moving into a new property, and what their relationship is. This may sound unimportant, but it represents the key criteria for defining licensing requirements, which have been growing in their scope and complexity in recent years. This gives referencing agencies a clear information advantage over other stakeholders in the property lettings chain, and delivers an untapped, and maybe even unexpected, opportunity for referencing companies to deploy this advantage to drive revenue.
Referencing companies can offer protection
The core role of referencing agents is to minimise risk for landlords and agents, and they do this through the provision of data, or intelligence, that reduces the chance of tenants failing to pay rent. The complexity of licensing legislation has created a new area of risk in which agents and landlords need support. With fines of up to £30,000 per breach and a 532% increase in enforcement over the summer, this risk is growing and is larger than ever before. The challenge goes beyond the financial, with landlord peace of mind threatened by the changeable nature of these regulations, and agents struggling to deliver clear answers without spending hours on the phone to their local council. As with customer reference checks, an operationally efficient answer is required.
Tenant referencing companies could provide clear guidance on licensing requirements, based on occupancy, directly to landlords and agents at their main point of need. This increases the value of their offer and provides a clear point of difference to the competition. Managing a new risk extends brand value, whilst providing twice the service also delivers twice the revenue. Landlords and agents demand simplicity, and referencing companies that can provide an all-in-one offer that consolidates tenants checks and property licensing checks stand to win more business, without joining the race to the bottom.
How can Kamma help?
Kamma offers licensing monitoring and compliance services that can swiftly be integrated to check any property’s licensing status and requirement 24/7. With an all automated service, little to no extra effort, referencing companies can expand their offering and explore this untapped market. SaaS-based referencing companies already utilise customer data to deliver a dramatically improved service to their end customers. It’s time they used property data to do the same.
In today’s highly competitive and regulated market, the key to success is to utilise data to create an offer that really stands out and offers great value to customers. That’s precisely what Kamma is helping referencing companies do. Kamma works with stakeholders across the lettings value chain to utilise the complexity and difficulty of licensing and turn it into a competitive advantage.
Contact us or book a demo now to understand how Kamma can solve property licensing for you.
