Information flow in UK flexible office space 

Analysing intermediary introduction funnel efficiency

Introduction: 

Intermediary / broker lead flow traffic accounts for a significant proportion of client introduction flow into the UK flexible office sector, exceeding 75% of all enquiry volume for some operators. Brokers are an invaluable part of the coworking ecosystem as a result, and their contribution to flex revenues cannot be understated. They have carved out unique market share over online enquiry acquisition, offering value to customers seeking coworking solutions by offering market comparison and negotiation services in exchange for fees from coworking spaces for successfully placing customers into occupation.

Office operators in the flexible office sector typically receive introductions from brokerages through API-based middleware which carries information about the client’s identity, contact details and search needs. The operator can then use this information to identify suitable available spaces within their portfolio to recommend to the client / broker for viewings. The extent to which this information is available at the point of introduction has a significant impact on how efficiently the office operator can zero-in on the right building / office to put forward.

Operator expectations regarding broker introduction detail are typically two-fold:

Ideally, the broker will include the client’s contact information alongside the introduction to facilitate direct dialogue with the flex company’s sales representatives, supported by sufficient qualification detail. This enables an effective evaluation of the client’s match with the available portfolio of offices.

If the client’s contact information is not provided, the supporting qualification detail becomes the only immediately-available information with which to make decisions on whether the client is a viable prospect.

Flex Engine have partnered with a leading provider of UK serviced office space to analyse a proportion of inbound broker introduction volume. This exercise was carried out in an effort to quantify the impact of qualification detail on the efficiency of the sales process in flex as it relates to intermediary-driven lead volume, and to extrapolate this to the flex marketplace as a whole.

Methodology: 

A sample of 150 sequential UK broker leads was used to analyse the data. A combination of London and UK leads comprised the sample, with a split of 71% London and 29% non-London. No personal / company identifiable information was provided as part of the exercise.

Data provided included: whether the client’s contact details were provided (yes/no format), the size of the requirement, the location of the requirement and the body of the qualification notes supplied with the lead introduction (redacted to remove any identifiable information).

The qualification notes were compared against the Flex Brokerage Qualification Matrix (see image at the end of this article) to determine how much information was supplied relating to the 9 qualification categories that ideally define a lead’s requirements. These categories are Basic information, company Hierarchy information, Technical needs, Commercial detail, Personal drivers, Logistics concerns, Space layout preferences, Aspirational detail about the company and General information.

Leads were individually graded yes/no for each qualification category based on presence of relevant information in the supporting notes, enabling a detailed analysis of overall qualification strength and information passed at the point of introduction.

Findings: 

What percentage of enquiries were provided with the client’s contact details? 

All Enquiries: 15% with contact details, 85% without contact details

London Enquiries: 11% with contact details, 89% without contact details

Non-London Enquiries: 26% with contact details, 74% without contact details

To what extent did qualification detail cover the 9 categories of the Flex Brokerage Qualification Matrix? 

Basic: 100% covered, 0% not covered

Hierarchy: 1% covered, 99% not covered

Technical: 7% covered, 93% not covered

Commercial: 21% covered, 79% not covered

Personal: 4% covered, 96% not covered

Logistics: 3% covered, 97% not covered

Space: 21% covered, 79% not covered

Aspirations: 7% covered, 93% not covered

General: 13% covered, 87% not covered

*Where a category other than Basic was covered, it provided either 1 or 2 information points from the Flex Brokerage Qualification Matrix 

For the Basic category, what percentage of core information was covered? 

Contact Details: 15% provided, 85% not provided

Size of Space: 100% covered, 0% not covered

When Needed: 50% covered, 50% not covered

Where Needed: 100% covered, 0% not covered

Budget: 15% covered, 85% not covered

For the When Needed sub-category of Basic (where covered), how specific was the occupation deadline? 

ASAP: 24%

Broad date range: 24%

Exact date: 52%

How many qualification categories were present in the lead sample? 

One category covered: 53%

Two categories covered: 34%

Three categories covered: 7%

Four categories covered: 5%

*No leads in the sample covered in excess of 4 qualification categories from the Flex Brokerage Qualification Matrix 

Impact analysis: 

In the majority of cases, the depth of qualification provided was insufficient to enable an obvious match to a specific building and / or available office in the operator’s portfolio. Whilst in 100% of cases the lead included information about the size and location required, 50% did not provide information about the occupation timeframe and 85% did not provide information about the budget commanded by the client.

Since 85% of leads introduced also did not include customer contact information, this represents challenges both upstream and downstream in the sales funnel for the inbound sales teams at coworking operators – in that they need to engage with the introducing intermediary (upstream) to re-qualify the requirement so as to position it accurately for match viability, and so that the requirement can then be passed (downstream) to building sales representatives.

This has a significant impact on sales process efficiency from a time-invested perspective. We estimate that each combination of a lack of contact details and partial qualification information requires approximately 15 minutes of operator time to resolve – getting in touch with the introducer, gathering additional information and completing a deeper profile on internal CRM systems for onward distribution.

For the 127 leads in this sample without contact information, this represents a time investment of 31.75 hours for the operator.

Extrapolating for the marketplace as a whole, we estimate that circa. 5,000 unique leads are distributed to the UK flex marketplace by broker intermediaries on a monthly basis, although the number may be much higher (conclusive data on this is not readily available). Each of these leads will then be introduced to 5 or 10 coworking operators on average in order for the broker to achieve robust market coverage, dependant on the competitive saturation of the market in the client’s preferred location.

This means that circa. 4,250 leads (85%) per month, without contact information and only partial qualification detail, will require 15 minutes of invested time per operator (5 to 10 in each case) to arrive at a position where the lead can be determined as suitable or unsuitable for progressing further.

The potential marketplace inefficiency addressed therefore adds up to between 5,312.5 and 10,625 hours per month based on either 5 or 10 coworking operators having to go through the process above for each lead in question.

Conclusion: 

Coworking operators do not necessarily wish for every introduction to carry contact information – the privacy needs of the customer in a complex, saturated and fast-paced marketplace clearly merit protecting and this is well understood.

The broker’s role also plays a key value-add component for the customer, through the collation of information, creation of shortlists, arranging viewings and subsequent negotiation support – all through a single point of contact which saves the customer time.

There is, however, a clearly-evident disconnect between the significant proportion of introductions made without contact details and the supporting depth of information describing the requirements for those customers. This represents an efficiency bottleneck in the marketplace with a significant associated number of hours expended to resolve.

From an operator’s perspective, the expectation is that if a lead is provided without contact information, then there should be sufficient accompanying information to enable internal teams to determine if the customer is a viable prospect for their available stock. Otherwise, the lead needs to be re-qualified multiple times over.

It is also likely that the primary issue on the broker side of this problem is simply time: the rate of customer duplication (where the same lead is sent through by more than one intermediary) in the flex marketplace stands at circa. 30% to 35%.

Since UK broker fee positions are initially secured by virtue of being first to send the lead to operators, each keystroke invested in putting together a comprehensive summary of client needs in advance carries a material risk to potential revenue down the line.

The purpose of this research piece is to put into stark relief the cumulative impact of current information flow – and that increasing the depth of qualification detail / rate of contact detail inclusion has the potential for significant gains in marketplace efficiency.