RentVision Founder and CEO David Watson joined host Daniel Cunningham in episode #61 of the Apartment Academy podcast to discuss maximizing the ROI of your multifamily marketing strategy.
Watch or listen to their discussion about:
- The changes to multifamily marketing over the years.
- What's wrong with most apartment websites today, and how floorplan-specific content can change that.
- Digital advertising strategies that reduce marketing spending and drive better-qualified leads to your leasing office.
- Learning more about RentVision's journey and services.
Key takeaway: "I think the most important thing to think about is, is your marketing dynamic? Your vacancy is dynamic, so is your marketing static, or is it dynamic? And I would just strongly encourage people to think about that...how much is (your marketing) changing based upon your unique scenario? Because the timing of marketing impacts your ROI tremendously."
Here's a transcript of the conversation. (Edited for clarity.)
Q: Tell us about the journey that brought you here today as now CEO of RentVision.
David: I own a property management firm called Century Sales and Management, and it's based here in Nebraska, where RentVision is located. We manage over 4,000 apartment units in Nebraska, predominantly third-party management.
In 2008, I noticed a lot of marketing and leasing challenges. Leasing agents would drive all over town, and sometimes people wouldn't show up for a showing, or they would show up and instantly not like the place. And then I started paying attention to the marketing we had at the complexes, and some of you might remember the magazine booklets in the grocery stores, and there's one page for the apartment community.
I thought there's got to be a better way to market apartments and we need to show floorplan-specific content. And I began to try to shoot walkthrough videos—and just invent those because they didn't exist at the time—and update our website. And bottom line is, I saw great success, but web development and walkthrough videos were too expensive and I needed to create another company to get more clients and more revenue to do this well. So in 2009, RentVision was born and we began shooting walkthrough videos for a lot of other companies and our product has expanded then for the last 14 years.
Q: You're really ahead of your time in foreseeing what has only come to the forefront in the last couple of years, which is this idea of videos being a major part of the prospect's pre-leasing experience.
David: Covid obviously brought to light the need for virtual showings. Before that, the magazine model just got applied to websites. If you go to multifamily websites today, most of the way photos are shown is there'll be a tab that says gallery, and you click that and you go see all the photos of the community. You don't know if the kitchen's from a 1-bedroom unit, the 3-bedroom, the clubhouse kitchen, or something else. They don't really provide floorplan-specific content. And that's because we spent decades needing one page in the magazine for your apartment community, and so you just had to pick a few photos. That magazine model literally got stamped onto websites. And I don't think until the last few years, people started realizing, 'Hey, we're doing this all wrong. We need to show a whole lot more information to people.'
We spent decades needing one page in the magazine for your apartment community, and so you just had to pick a few photos. That magazine model literally got stamped onto websites. And I don't think until the last few years, people started realizing, 'Hey, we're doing this all wrong. We need to show a whole lot more information to people.'
Q: Has there now been wide adoption of these video walkthroughs? Is it still in its infancy in terms of adoption? Where (does multifamily marketing) stand now after 2019, 2020, and what we went through?
David: Surprisingly, it's in the infancy of adoption. I anticipated this to be widespread adoption many, many years ago and it really hasn't happened.
I actually see more people in the industry at trade shows talking about person-less showings where somebody can self-service, get a code on their phone, and tour an apartment on their own, and how great that is. For every showing, there are probably about a hundred people that visit a website or 50 people that visit a website. And why not spend the time showing people your units there? Frankly, some people can't come tour your unit, they live out of state or out of your city, and they're going to be moving in. And a lot of people, they want renting to be easy, and the easiest way to make it is to allow them to walk through your units online.
One of the other challenges, even amid Covid with getting walkthrough videos, is everybody was 100% full. And so, no one felt the need for walkthrough videos because anybody could rent their apartments over the last few years. Now we're starting to see a little bit more vacancy cropping up in certain parts of the country, and people are beginning to study their marketing and leasing and pricing practices a little bit more closely to try to make some changes and saying, "Hey, you know what, we should provide all the information.
Imagine going on Zillow and not seeing photos inside the home you're looking at. Well, by not showing floorplan-specific photos, walkthrough videos, or content, that's effectively what the experience is for a lot of people shopping for an apartment. They get to see photos of the outside of the home or the outside of the apartment community and nearby amenities, but not the floorplan-specific content.
Imagine going on Zillow and not seeing photos inside the home you're looking at. Well, by not showing floorplan-specific photos, walkthrough videos, or content, that's effectively what the experience is for a lot of people shopping for an apartment.
Nobody understands this better than the person on-site who's getting phone calls from unqualified leads because they haven't been able to see the information. They're wasting time answering questions and doing showings that are kind of pointless. And so there's a lot of value and efficiency and driving more of the right leads by showing floorplan content, whether it's walkthrough videos or a step below that, just floorplan photos even.
Q: Are people intimidated by the prospect of managing all of this media? I got all these videos, and how do I know which one is the bathroom for unit 402 or my 3-bedroom, and how do I publish all that properly? Is it that, or is it the time it takes to orchestrate shooting those videos and have it done properly? Or are people just not aware?
David: Some people don't realize the importance of floorplan content. And I would just tell people, make renting easy for your end user. So provide floorplan content, pricing, availability—all these things.
But the second headwind is time. One piece of the time you mentioned is that you have to get people there to film all your units and floorplans. Some of your floor plans aren't available because they're 100% occupied; therefore, bringing a videographer or photographer there one time isn't enough. It's multiple trips because you have to wait until you have vacancies in the right units or floorplans to film them.
The other problem is you've got to spend time on your website because if your website's not set up to display floorplan content, what's the point of taking floorplan content? Your website's got to be designed correctly to display all of the content. If your website's not there, there's no point in the photo. You've got multiple avenues that have to get worked on simultaneously to deliver a complete product to your prospective residents.
Q: What does it mean to say your website's not ready to present this walkthrough content?
David: "Most community websites just have a gallery page with all the photos on one page. An effective website needs to have a page for every single floorplan.
An effective website needs to have a page for every single floorplan.
So let's just say you have one 2-bedroom floorplan. That floorplan needs its own page where you can put the photos, a walkthrough video tour, and all the information of that 2-bedroom. Most websites have a floorplans page showing 2D diagrams of the floor plans, and then, you navigate to a separate page called gallery and scroll through all the photos of that entire apartment community. There really is no spot to put a gallery of photos or a walkthrough video of that 2-bedroom floor plan.
That website needs to be set up properly to show that information. You can get more advanced with your marketing like we would at RentVision, where we feature the right floorplans on the homepage based on vacancy and future vacancy and driving traffic. But the foundation is you need to be able to display floorplan-specific photos and walkthrough videos for every individual floorplan to an end user in an easy-to-find and navigate fashion.
We have websites that people can purchase, and ours are built on our software platform so we continue to roll out updates. You don't get a website, and then it's static and stays the same. Every time we roll out updates, it changes, and it's all built for floorplan-specific content. And then, you have a content management system that you log into with all your floorplan data that can be changed at any time.
Q: Are there statistics you can share with our listeners about what a difference a walkthrough video makes?
David: Conversion rates definitely go up. There are a number of factors with conversion rates. If your price is too high, your conversion rate goes down, but all factors being the same, conversion rates go up. But one of the most interesting things is the lead-to-lease conversion rate, not just the website visit-to-lead conversion rate, which can improve too, but it's mostly the quality of leads goes up, not just quantity.
So many people are stuck measuring the quantity of leads. But we know quality of leads goes up because the conversion rate from lead to lease dramatically improves. Somebody that calls you who's watched a walkthrough video tour, they're not coming to the showing to see what something looks like. They're not in the discovery phase but in the closing phase. They're there to come and confirm that things look the way they saw online, so your leasing agent can push the closing rather than the showing at the point of showing.
Somebody that calls you who's watched a walkthrough video tour, they're not coming to the showing to see what something looks like. They're not in the discovery phase but in the closing phase.
And so we see our percentage of leads that convert into leases across the board is superior to every ILS, and we know this because we also measure leads and leases for all the listing services and other marketing avenues for our clients.
One of the ways I've benefited from it as an operator myself is not needing a variety of people because you're able to do showings automatically online. I'm actually always surprised how many people it takes at an apartment community. At Century, we'll run 200-plus unit apartment communities with one person in the clubhouse to cover everything—and then maintenance beyond that.
Q: Do you no longer wish to give the tours in person if you have these walkthrough videos?
David: We still do the tours in person if the person doesn't rent sight unseen. It's just that one person doesn't have to handle a whole bunch of unqualified leads and a whole bunch of unqualified showings because by the time somebody calls in, they're highly qualified.
Some people get nervous and ask, 'Am I going to lose leads (with walkthrough video tours)?' Well, what we found is more people call that wouldn't have called because after seeing the a unit's walkthrough video, they realize, 'Oh, that actually is worth my time.'
Then some people don't call because after seeing the unit's video, it would be a complete waste of time. So the time efficiency really improves for the people working inside the clubhouse doing showings and handling the phone and email leads.
Q: Okay, so (floorplan-specific walkthrough videos) are super valuable for increasing conversions and qualified leads. There is another half to the RentVision equation, which is predictive advertising. The algorithm you guys have developed that allows, I hope I'm not putting words in your mouth, but the way I understand it, instead of just blanketing the internet with all of your available unit types all of the time, it notices your availability and pushes out the right unit type and presents the right video. Is that accurate?
David: You did good. The thing that we noticed in the industry is marketing is static. Everybody plans their 12-month budget, they sign a 12-month agreement with marketing vendors and they do the same thing every single month. But your vacancy is dynamic. One month you have a lot of vacancy. The next month you don't have much vacancy. And so why would you want your marketing to be the same?
The whole premise behind predictive advertising is to drive traffic when you need it and save money when you don't. We integrate with all the different property management software platforms, and our algorithms automatically pull in your current and upcoming unit availability, the timing of all the move-outs, and the ready dates. We factor all that in and we automatically change digital advertising every single day right when you need it. So we'll drive up traffic and—as you mentioned—traffic for the 2-bedrooms if you have a lot of 2-bedroom vacancies.
The whole premise behind predictive advertising is to drive traffic when you need it and save money when you don't.
And if you have no 2-bedrooms available or coming available, we're not going to spend money on targeting keywords on Google like 'two bedroom apartments' because why would we want to spend money on that when you don't have any availability there? Every single day our algorithm looks at your future availability and makes adjustments to the spending level and the keywords.
The website is also dynamic. We know that the first featured floorplan on the homepage gets clicked the most. That will be the floor plan with the most current and future vacancies. And so just how we order everything on your website changes daily based on your specific needs.
Q: How does this differ from property management software products that do some of this? What's the advantage of the RentVision setup?
David: We actually invented our own algorithm called Future Occupancy. When you look at the metrics there are today, there's the 'leased' metric, which is pretty pointless as far as I can tell because it doesn't include any future move-outs or take into account. You've got your 'trending' metrics, which is maybe the closest thing. The problem is some trending metrics take into account all future move-ins; you're guessing 30 days, 45, 60 days ahead. We dial in on an individual apartment community's unique metrics, how far ahead are people renting apartments? And then looking that far ahead for future move-outs and timing the spending with when it should happen.
I've seen some people talk about dynamic advertising. I haven't really seen anybody actually implement it besides us. One company I know implements it where they change, but it's kind of a manual conversation once a month, whereas ours is every single day automatically tying into your own data.
Q: What is the experience of somebody who implements this predictive advertising to reduce their marketing spend? Does it cut it by 30% or does it make it just more effective? Your cost per lead goes down?
David: Most of our clients end up cutting all their listing services entirely after they gain confidence in the system and how it's working.
Most of our clients end up cutting all their listing services entirely.
The bigger ROI would say is just increasing occupancy because, for some clients, you just hit that random time where you have way too many move-outs all at the same time. And by the time clients react, often it's usually late. "Oh, we've had these units sitting longer than 30 days," and it's like, well, that's late. What were we thinking before the units even moved out? What should we have been doing? So when those situations arise and you're able to increase your traffic by 50 or 100 percent just at any given moment, you can cut down on time from move-out to receiving a rental application pretty dramatically in those seasons.
Q: And so does your system... You're automatically selecting keywords for Google paid advertising searches, right? Is that 100% the source of the leads?
David: For predictive advertising, if we have a client's website, obviously we want organic and direct from Google, but when it comes to paid advertising, we're using Google, Meta (Facebook), and getting into being in TikTok as well. And so they're all different. They all have different purposes.
Take Facebook, for example, that's going to be a little bit of a wider, top-of-funnel audience when we need to drive more traffic in that way, the traffic's a little bit less qualified. Whereas something like Google, it's going to be more keyword specific, more targeted, a little bit more middle and bottom of the funnel. It can be top of the funnel, but it gets more expensive when you're going on Google.
So what our systems actually do is measure engaged visits to our website. A lot of people measure clicks or cost per click, but if people come to your website, they don't spend much time, that's kind of pointless. And so we look at how many people are coming to a website and are they engaging? Are they looking at floorplan walkthrough video tours or floorplan pages and scrolling photos and doing all the behaviors that lead to a lead? Then we can actually go back and look at our advertising platforms and see which keywords, which campaigns, or which platforms are driving those engaged visitors. And our system automatically allocates money within each platform on an hourly basis daily to different keywords and campaigns or on an hourly basis or whatever. So our systems are looking at your future vacancy every day, which floorplans it's in, and then the cost-effectiveness of all the advertising platforms—all the keywords and campaigns—and making allocations and changes automatically to maximize the ROI of your digital ad spend.
Q: Do most of your clients use the websites and videos as well as advertising?
David: Historically, people would mostly use all of them. That's been more something new where we've just turned into more modular offerings so you could buy one or the other if you needed.
So now this year, that's not necessarily the case. We're getting a mix of people using everything, some using one side or the other. I will say this though, while you can work with us on one side or the other, you need a good solution on both sides, whether it's RentVision or somebody else. If you spend money on predictive ads and it goes to a website that doesn't have floorplan-specific content and doesn't convert very well, you're kind of wasting a lot of money. So it doesn't need to be us, but we do strongly encourage clients to make sure they have an effective solution going on both sides.
Q: You mentioned integration. RentVision integrated with which platforms?
David: RealPage, Yardi, Entrata, Rent Manager, ResMan, and AMSI. The only one we're working on right now and going through the due diligence is AppFolio. So hopefully we'll integrate with that one soon.
Q: David, is there anything else we didn't touch on today that you think is really critical for people to consider when they're thinking about their digital marketing plan and strategy?
David: I think the most important thing to think about is, is your marketing dynamic? Your vacancy is dynamic, so is your marketing static or is it dynamic? And I would just strongly encourage people to think about that, whether it's your website or predictive ads, how much is it changing based upon your unique scenario, because the timing of marketing impacts your ROI tremendously.
Interested in learning more about RentVision can help maximize the ROI of your communities' marketing strategy?
Schedule a demo today.