Vacancy is the defining problem in the multifamily industry.
It has the most direct impact on revenue, which is what owners and executives worry about most.
But vacancy also creates more immediate stress at a community level, which affects everyone from marketing directors to property managers to leasing agents. The pains differ from position to position, but no one responds positively to unwanted vacancy.
Spontaneous Marketing Doesn't Work
One reason that many communities can struggle is that they don’t have a plan for when there’s a sudden increase in vacancy.
Rather, they have a loose bundle of apartment marketing tactics that work separately and with varying degrees of success.
Here's what we mean: Let's say Sunny Ridge Apartments is at 80% occupancy and is trying to figure out what's gone wrong and how they can fix it. What do they do?
First, management will likely talk to their property manager or marketing director to try and figure out the issue.
Has the leasing team been well-trained on how to handle leads and provide high-quality community tours? Or perhaps the rent is too high. Sometimes, it’s as simple as prospective residents are unable to physically find the community.
What it comes down to is that there are many possible reasons for a high vacancy rate, but not all communities are equipped with the necessary tools to identify the root issue. This can result in each decision maker developing their own plan about what needs to be done at the community, which can lead to even more confusion.
They may host training with the onsite staff, call their ILS rep and increase their marketing package, or experiment with new Craigslist posting strategies—the list goes on and on.
If none of that works, they're going to take a hard look at how their website is performing and talk to a marketing agency or the marketing director.
The only thread tying all of this together is, “We want to rent apartments and we want to avoid vacancy.” However, the various marketing tactics mentioned don’t reinforce each other at all. In fact, they may be competing against each other.
Independent Strategies Create More Work
Because it is so difficult to identify the root of most vacancy problems, it is similarly difficult to find a solution. In fact, implementing new marketing solutions can sometimes require as much work from you and your team as managing the community!
Maintaining all these tactics requires spreading your team so thin that simply maintaining all the different pieces (Craigslist posting, increased ILS efforts, rent specials, etc.) is as much work as leasing apartments and running a successful apartment community.
Multiple marketing strategies require increased management and attention to detail, which also opens the door for items to fall through the cracks. Increased marketing can be effective, but if you don’t keep a close eye on what each vendor is providing you with, you could end up competing with yourself. For example, if you increase your ILS package while also increasing your own Google ad spend, you wind up paying ILS’s to bid against your personal ads, which drives up the cost of both digital advertisements.
How to Centralize Your Apartment Marketing
The good news is, there’s a better way to align your apartment marketing strategy. The key idea is a unified strategy in which your various efforts reinforce each other.
- Using data to build confidence within your team and identify problems.
- Dynamic marketing strategies allow you to adjust what your community is spending based on what your community needs.
- Websites that convert visitors to leads and leads to leases, providing a steady stream of sustainable revenue to your community.
Data-Based Marketing Identifies Problem Areas
The first step is to set up systems that allow you to make marketing decisions based on data rather than instinct or supposition. This is important for a couple of reasons.
First, if you have a vacancy problem, you need to be able to accurately and reliably identify the root cause of the problem. Vacancy can have many possible sources. Can you identify the problem at a specific community in your portfolio by citing actual marketing data like conversion rates from phone calls to showings, or from showings to leases, web traffic patterns, etc.? Or are you mostly working from memory and hunches? If it is the latter, solving a vacancy problem becomes that much more difficult because you don’t actually know what specific problem you need to solve.
Second, another common challenge to addressing vacancy problems is that, oftentimes, multiple stakeholders want to be involved in fixing the issue and they might disagree on what needs to be done. If you have reliable data, you can make a suggestion that’s backed by analytics, which will help move things along and implement a successful solution. This can create greater consensus across your team and makes for a happier work environment, but it also makes it easier to get everyone rowing in the same direction.
Dynamic Marketing Beats Static Marketing
Vacancy constantly changes. But most marketing vendors in the industry sell static packages that don’t respond to changes unique to your community.
One obvious problem this creates is that it can be hard for you to adjust marketing spend as needed. It’s common to increase the marketing budget during peak leasing season or else you face the lingering problem of vacant units headed into a slower time of the year. On the other hand, you may end up over-spending when you are at an acceptable occupancy level.
In both cases what you have is mismanaged community resources that have a direct impact on your community’s bottom line. Either you end up with lingering vacant units or wasted marketing dollars.
In the digital era, overspending and underspending on marketing is entirely unnecessary and avoidable. Fixed marketing costs like websites should not be burdensome. More fluid expenses, like advertising budgets, can be adjusted on the fly, especially if you are advertising with Google Ads and Facebook Ads.
“Set it and forget it,” sounds nice, but when a community’s circumstances are always changing you want a more responsive marketing strategy.
Websites Should Generate Leases
Now, let’s talk about solutions to the spontaneous marketing issue. One of the best ways to identify potential marketing issues is to ask your team to provide a one-sentence answer to the question, “Why do we have a website?”
Because websites are such a common tool in the industry, it can be easy to think of all websites as being interchangeable. We start to see them as something we have because that is how the industry works. Our competitor has a website, so we have a website. This is the wrong way to think about it.
So, we’ve determined it is important to have a website.
It is important because websites are a 24/7 leasing agent.
Amongst other things, this means you need to evaluate your website the way you would evaluate a leasing team member. Is your website generating leads for your community? You can accurately answer this question if you are using tracking phone numbers. Are those leads turning into leases?
Websites that generate high-quality leads that turn into signed leases will excel in the same ways that a good leasing agent excels. They’ll give prospects a clear picture of what life at the community is like, get them excited to sign a lease, and help you put your best foot forward with prospects. To achieve this, your website needs floorplan-specific photos and videos that allow prospective residents to see the unit they may call home in the future.
Is this just another way of creating the same kind of silo problem?
After reading this you might be wondering if this actually solves the problem we discussed in the opening paragraphs.
The answer is yes, it does. You could work with a single marketing vendor who will manage all three aspects for you, giving you a single contact person for all these various aspects of your marketing.
Or if you're a smaller community, there are resources that can help you manage this in-house. Website hosts can help you build a successful website, especially with a little bit of help from a tech-savvy friend or freelancer who could help you with specific tasks. If you have a quality cell phone camera or a nice digital camera, you can shoot photos and video and upload them onto your site. To track where traffic is coming from, set up tracking phone numbers and tracking URLs—a quick Google search can help you with this. Ultimately, the good news is, you can achieve a successful marketing strategy in-house.
This comprehensive marketing strategy is incredibly agile, makes it easy to track using analytics and call tracking, and it's the strategy best adapted to the current technological environment we are in. It may seem like a lot of work to implement this strategy, but the rewards for doing so are significant.