Does “Family Owned” Matter to Customers?

Questioning a Staple of Family Business Marketing

Family businesses everywhere have touted that they were “family owned and operated” since the dawn of advertising.  And they’re still doing this today.  Our home building company was no exception.  There’s just something about that family pride that those involved with the business understand.  They’ve worked hard to build that business reputation (many of which have the family name tied to it), so those family business members automatically figure that their customers logically value that hard work.  But do they……really?!?

Over the years, I had attended lectures and read books on marketing best practices.  Although I can’t remember which lecture it was, I distinctly remember the speaker asking how many people in the room marketed their business as “family owned.”  It was surprising how many people raised their hands.  All those who raised their hands believed that there was true value in touting that familial “connection” as a value to customers.

It didn’t take long for the speaker to deflate the egos in the room.  He said that the majority of customers really didn’t care that we were family owned, and he told us that we shouldn’t be using that as a marketing message.  The family members in attendance shot some questioning looks to each other – all figuring the lecturer had no idea how Central Pennsylvania thought…..and how everyone valued hard work and family values.  Surely, the lecturer must be a crackpot.

We continued to market the same way.  I’m pretty sure most everyone else did, too.  Just this morning, a radio ad touted an automobile family of dealerships who had “been family owned for 39 years.”  I smiled as I listened to that – as this issue of value in family ownership has been rolling around in my mind for the last day or so.  (Side note:  this is just like when you are interested in a new vehicle, you automatically notice that vehicle everywhere you go).

So, since that was the ad I heard this morning, I really thought about my own experiences purchasing a new car in my life.  I’ve purchased and/or leased a number of vehicles over the years.  My first family vehicle was from a dealership that was near my home – a Chevy Venture since my wife and I were blessed with our first child (yes – this is the time when I broke down and bought my first mini-van).  In this case, the styling of the van was what caused me to buy it.  The dealership was selected because it was the closest Chevy dealer to my house.  It was a family owned dealer, but that really had no impact on my purchase.

My last few family vehicles all came from a local Harrisburg Honda dealership.  Our first Honda was very reliable, so my wife and I became pretty brand loyal – but – that loyalty was to the manufacturer based on reliability – NOT – the local dealership.  We kept going back to the same dealership because their service department was second to none.  It’s obvious that they have worked diligently on their service procedures to make sure they can delight their customers most every time.  In fact, their reputation and action of service kept us from wanting to shop anywhere else (though some would maybe judge us as foolish for not doing so).

If I really think about it, advertisements touting “family owned” for this dealership would have absolutely no bearing on my decision to shop there.  And I don’t think they do advertise that fact (in fairness, they do use the owner in their ads – but – he’s not used in a blatantly “family owned” message).  Still, I’m not buying based on him (sorry Mr. Rahal).

Why, then, did I (and family business marketers all over the world) think that anyone else really cares that their business is “family owned and operated?”  Are we just all that self-centered?  Is family business not important to anyone but the family members themselves?  Is there ANY industry where family ownership matters to the customers?

With over 23 years touting that ownership in marketing, it somehow feels like a letdown.  Yet the reality is that it may have mattered to some – but – it didn’t matter to the majority.  In our family’s home building business, we saw larger companies come in and dominate the market – companies that gladly touted they “weren’t home builders – but – they were marketers who just happened to sell new homes.”

I remember conversations where we scoffed at these builders who didn’t value building as good of a home as we did.  And those owners didn’t meet directly with customers.  And they would “cheapen” their product to get a low price to sell those homes.  There just was not a personal connection, and that’s something a “family owned” company could do better than anyone else.  We felt secure in our position in the market place.

The Housing Bubble Burst of the late 2000’s changed our local market considerably.  “Great Price” trumped “Great Product” and those small to mid-size home building companies felt the true impact of larger home building companies that were more business and less family.  And home buyers didn’t seem to care as much.  They were getting great deals on homes!

Family ownership truly was NOT a factor in their selection for their new home.  Truthfully, it probably never was as big of a factor as we liked to think it was.  And I can believe that is probably more prevalent than anyone in a family business really wants to admit – no matter what industry.

QUESTION:  Do you think “family owned/operated” has any value in marketing messages?

You can leave a comment by clicking here.