CLASS is very honored to have guest blogger and Student Housing Consultant Michael Coakley join us to weigh in on the amenity arms race that we are experiencing in Student Housing.  We would like to thank Michael for his great insight into the features and amenities that truly ad value for Student Housing developers.

THINK BEYOND THE WALLS OF AN APARTMENT:  BY MICHAEL COAKLEY

At the recent BISNOW conference in Philadelphia, several of the panelists, including me, expressed concern that some college and university markets are being overbuilt with properties that offer high levels of amenities.  Granite countertops, stainless appliances, resort style pools, and extensive fitness areas are norm in many new off-campus properties catering to the college student population.  While these premier properties are appealing, there is a finite percentage of the student population that can afford to choose to stay in such a property.  There is even a larger percentage of the student population that is looking for more affordable accommodations within close proximity to campus or with mass transit close by.

As the 21^st Century Project determined students are driven by the following: privacy, technology, community, and sustainability.  2/2s and 4/4s will continue to appeal to the majority of the student population.  Units that provide the greatest degree on technological integration with their multiple devices will be valued.  A property that encourages and promotes the development of community will stand above the rest of the competition.  A property that promotes sustainability via energy efficient heating and cooling; easy to access recycling;  ease of bicycle parking/storage; and the use of sustainable products in all aspects of the operation will have a market advantage with the generation of students who are now attending institutions of higher education.

At the same time, students and their parents are becoming much more astute customers.  What makes your offering stand out above the competition?  Instead of offering a free month’s rent, or a chance to win the latest and greatest techno toy, or the opportunity to have a unit that faces the pool, consider what adds value to both the student and their parents.  Instead of requiring it, why not offer renter’s insurance as part of your rent?  In addition to providing washers and dryers in units or in close proximity, why not offer a weekly laundry service pick-up and drop-off with one of the local businesses?   Depending on your location, why not provide free shuttle service to and from the local airport during holiday season?  The opportunities are endless on how you can make your property stand above the rest of the market at a relatively low cost but will be viewed by students and parents as being invaluable.  Students and their parents are seeking more than just an apartment, they want an experience and value.

Michael J. Coakley

Coakley and Colleagues, INC

You can reach Michael at michael@coakleyandcolleagues.com

Coakley and Colleagues, INC, is a consulting firm focusing on higher education, with a particular focus on student housing both on and off campus.

www.coakleyandcolleagues.com

    Marketing drives sales; it’s as simple as that. And as a company that specializes in apartment lease-ups, we know that when marketing is done consistently and correctly it will increase traffic and therefore increase leases. But that shouldn’t be news to you. What should be news to you is that you’re probably doing it wrong.

In the apartment industry we see a lot of the “let’s throw it out there and see what sticks” mentality. No one is really sitting down to think their marketing plan through. This can result in a waste of money and a leasing and marketing team that feels defeated and unmotivated when they don’t see results.

This can all be avoided by target marketing and market segmentation. Target marketing refers to who will be using your product. Sit down and decide what group, or groups, of people are going to be attracted to your community. If you’re running a student property or senior property this part will be easy for you. If you’re a conventional property, your answer will more than likely be anyone and everyone.  Now that we know who we’re targeting let’s get marketing, right?! Wrong.

The most crucial part of a marketing plan is market segmentation. Market segmentation refers to taking the target market you identified and breaking it up into different groups, or segments, and approaching them each in different ways. When you think about it, it makes sense. You wouldn’t advertise a car to a baby boomer the same way you would advertise it to a 20-year-old so why would it be different with apartments? We need to discard the ‘what works for one works for all’ way of thinking.

Types of market segments:

                1) Baby boomers: Although they’re becoming more comfortable with social media and navigating the internet, they certainly aren’t as comfortable as their younger counterparts. Keep your ILS sites because they will in fact attract baby boomers, but you can’t depend solely on them to drive traffic. Implement a guerilla marketing campaign using flyers to target places baby boomers frequent: isolate restaurants, shopping centers, doctor’s offices, etc. The natural progression is that they’ll see your flyer, do some research online and contact you through one of your ILS listings.

                2) Generation X: With a general age range of about 33-48, this group is busy. They’ve got careers and families and apartment hunting may not be their first priority because they simply don’t have time. So if they aren’t coming to you, you need to go to them. Implement a direct mail campaign and send literature to their homes. Also, beef up your preferred employer program and reach Generation X at work. Make sure you visit these companies in person– and bring more than just flyers. Gift baskets, pizza, candy, etc. can go a long way in making sure your community is remembered.

                3) 20-somethings, also known as Gen. Y: You’ve got to get creative here. This group is inundated with ad campaigns daily so you need to make sure you’re standing out– and social media is a fantastic tool to utilize. LeaseStar Social (formerly known as RentMineOnline) lets residents advertise your community to their friends using various social networks.  It’s essentially the same as the referral program you may currently have in place, but you have the potential to reach hundreds of people. Another out of the box idea for Generation Y was The Irvine Company’s use of Instagram and Twitter to promote one of their communities. They cleverly hosted three sisters (with a combined following in the tens of thousands) for one week and had them tweet their experiences. It created a huge buzz for the property and you can read more about blogger Jonathan Saar’s thoughts on the project here: http://jonathansaar.com/2013/05/03/apartment-marketing-with-the-veturis-sisters/.

To learn more about LeaseStar Social visit: http://www.rentmineonline.com/learn/benefits/

For today’s consumer, there is purpose behind a purchase.

If you watched The Masters last month, you may have noticed ExxonMobil’s campaign for their National Math and Science Initiative.  Rather than promoting their product, ExxonMobil utilized a marketing technique known as Cause Marketing.  Coke also just released a very cool video campaign based on cause marketing that you can see here.

Be prepared to see more cause marketing as consumer buying behavior is trending towards purpose purchasing.  In other words, people are starting to support brands that actively support a charity or cause.

Here is an amazing stat from the CauseMarketingForum.com:  purchases from brands that utilize cause marketing are up 47% since 2010. Over the years, consumers have taken increased action on behalf of brands with purpose.  When product and price point is equal (as is usually the case within multifamily submarkets), consumers tend to choose organizations that partner with and promote a charitable initiative.  Marketing Directors are seeing the ROI on these efforts and cause marketing expenditures are expected to reach nearly $2 billion in 2013, up 5% from 2012.

It may be time to leverage this trend into your marketing plan.  Here are a few ideas.

1. Establish a charitable donation referral program.  When a resident or local business refers a move-in, make a donation to a charitable organization.   Send a notice to that business or individual to let them know that the donation was made in their name.
2. Develop resident events that raise money for organizations like The Wounded Warrior Project.  This can include drawings, rummage sales etc.
3. Partner with local food bank and schedule a day where your residents can help donate their time.  Provide a shuttle service, food and drinks and build a sense of community for your residents while assisting at the food bank.

Make sure to take plenty of pictures of these events to document on your Facebook page.  This will act as great exposure for your community while also providing much needed funding and assistance to a good cause.

This is a great app for your smart phone that can really be of assistance for not only leasing agents, but also for prospects.

The app is called RoomScan and was created by Locometric.  RoomScan allows you to measure the dimensions of a room by simply holding your phone up to each of the walls in the room.  The app is also incredibly accurate with only a small margin of error of plus or minus 2%.

Seeing the app in action is quite impressive, as it is a very user friendly system and fun to use.

As a prospective apartment shopper, RoomScan would allow you to have an exact idea of what can and cannot fit in a potential apartment.  You will never have to wonder if your bed was going to be too large for the room, or if that sofa was going to extend past the end of the wall with the exact dimensions RoomScan can provide.

From a leasing agent perspective, utilizing RoomScan would enable you to to provide extremely accurate dimensions to your prospects for every single room of their new home.  In doing this, you would not only be educating the prospects on the apartment, but you would also be getting them involved with the tour.   This will also allow a leasing agent to prepare ways to overcome objections if a room is small.  Most importantly, using RoomScan will make your tour even more memorable, which in turn would make you standout from your competitors.

I cannot tell you how many communities I have shopped where the leasing agent does not know the dimensions for each room.  It is unhelpful and it makes it appear as if the agent doesn’t know the community.  By using RoomScan, you will look knowledgable and impress your prospects with the exact specifics of the apartment.

Take the time to download the app and give it a try.  If you are a leasing agent, I think you will find this app to be very helpful to your presentation of the apartment and could absolutely lead to more leases.  Plus, the app is free!

CLASS has spent the past month leasing a by-the-bed student property at Texas A&M University.  In a saturated market it is extremely important to quickly identify emerging trends in order to capitalize on market share. By gauging these trends and tweaking our sales process, the property is almost ten percent ahead of last year’s pre-leasing numbers.

Here are three trends we’re seeing this year:

• Enhanced focus on cost-effectiveness

Having leased-up the same property last year we have noticed an unmistakable uptick in the number of students paying rent on their own, whether through part-time jobs or student loans and grants. This results in a consumer far more involved in the buying process than we’re used to seeing. Whereas last year’s student, with parents footing the bill, didn’t care about price tags, this year’s student wants to ensure they’re getting the most bang for their buck. It is imperative that value is conveyed to this year’s student. Whether that means calculating how much money your community will save them on utilities each month or charting out the bus route to show how much closer they’ll be to campus, you must be communicating value at all stages of the sales process. In order for the price-conscious student to lease at your community, they need to perceive some sort of value in your product. Resident events and parties are no longer cutting it for a lot of students.

• Short-term leases

Reading that may have you cringing, but it’s true. The reality is that many students don’t want to lease an apartment over the summer if they aren’t planning on staying in town. However, students want short term leases so badly that they’re willing to pay almost anything for them– and Mom and Dad are too.

At my current property, the only alternative to a 12 month lease is one beginning in August and ending in May. With our current rent concessions taken into consideration, the 12 month lease actually ends up being the cheaper option when compared to the 10 month lease. Naturally, you would think that students would agree with the math and choose the longer lease. However, that is not the trend. Students are choosing the 10 month lease at almost every opportunity and sighting their “summer freedom” as reasoning. Our competitors have also taken notice of this tendency and one property in particular is charging a premium fee of $100 a month for 9 month leases.

• Applying and leasing online

There is nothing this generation loves more than the ease of technology. While some of you would never personally apply for an apartment online, this year’s students are doing that and more. Recently my property expanded upon the typical process for applying online. Instead of filling out the standard contact form and having a leasing agent get in touch with the prospective resident, our new website allows for the entire lease to be signed via our property website  without ever stepping foot on the property. While this approach certainly won’t appeal to every student, it definitely has caught the attention of some. In almost a month’s time we have received an average of about 20-25 online leases. While this number may pale in comparison to the number of leases signed in the leasing office, it is significant nonetheless. It’s very likely that the property may have lost out on these leases had we not had the online process in place.

PROPERTY OVERVIEW:

The subject was a distressed property located outside of Cincinnati, Ohio.  The property had a terrible reputation for crime and gang activity and was poorly managed.  The asset was acquired by a local company that invested a significant amount of capital for both an interior and exterior renovation.  The property underwent a name change and built a new leasing office.

The first building came online in October 2012 and during the next 90 days the property captured 21 leases; however 16 were rejected due to credit or criminal backgrounds.  After receiving only 1 additional approved lease during the first 3 weeks of January, the owners decided to enlist the help of CLASS.

STRATEGY:

CLASS recognized that the property was suffering from a reputation issue that was resulting in under qualified traffic.  Additionally, a strong closer was needed to overcome the property’s reputation and other objections such as the lack of washer and dryer connections in the units.

CLASS needed to get the word out about the changes to the property and drive more qualified renters in the door.  CLASS also needed to find a solution to the washer and dryer objection, particularly since the onsite laundry rooms were still under construction and the few existing residents were required to drive offsite to a local Laundromat.

IMPLEMENTATION:

CLASS implemented the following changes to the leasing and marketing platform:

1.  CLASS set up a program with a local dry cleaner and Laundromat where residents could drop off their laundry every week at the office and it would be returned there in the afternoon.   This service was provided free of charge for all residents until the laundry rooms were operational and served as a great selling feature to help overcome any objections.

2.  Increased social media platforms: CLASS knows that today’s renters rely heavily on their peers when it comes to purchasing decisions. They are more likely than any other group to research social media platforms of a community and search for resident reviews.  CLASS consistently updated Facebook and Twitter pages which advertise the specials, communicate with residents and prospects, and reach out to local businesses.

3.  CLASS implemented an outreach marketing plan in the form of tear-off flyers, ¼ page flyers, and full page floor plan sheets. CLASS also ordered post-it note flyers which were quickly distributed to target areas. CLASS made sure to put in several hours of outreach each week and made the effort to speak to as many employees as possible to give short pitches about the property.

4.  CLASS established a preferred employer program.  This helped target local students and local businesses.  CLASS also set up a resident referral program.

5.  CLASS ensured that the property was properly listed on search engines like Google and Bing and deleted all information prior to the rehab.  CLASS also generated numerous positive reviews from both residents and prospects to improve the online reputation of the community.

6.  CLASS created a direct mailer which targeted local qualified residents and informed them of the positive changes to the community.

RESULTS:

By implementing these strategies CLASS was able to significantly increase traffic and leases. After only receiving an average of 2 applications per week over a four month period, CLASS was able to secure the following numbers:

RENT REVENUE PER MONTH

WITH VS. WITHOUT CLASS

*assuming property continued the current unit absorption rate

Click to enlarge

COST OF CLASS VS. INCREASE IN ANNUAL RENT REVENUE

*The increase in leasing activity resulted in an estimated 30 more leases than the property would have obtained without CLASS.

*Annual rent revenue generated by these additional move-ins = $261,000.00

*Total cost of CLASS Service = $36,000.00

Click to enlarge

With all the talk about marketing and leasing to college students, we often find that a critical decision maker is left out of the sales process.  I’m talking about the parents.  You know, the folks who are actually writing the rent check.  While the property must first appeal to the student in order to have any hope of procuring a lease, we often underestimate the influence that a parent can play in the decision making process.  This is especially so if we are looking to maximize rents and the price point is going to be a key issue.

Before we explore some ways of marketing to parents, we first need to understand the basic dynamics of buying behavior.  When two parties are considering a purchase, one typically finds that the party who initially identifies the product will take a pro-purchase stance, while the party who was not present during the initial inquiry will often play devil’s advocate.  This is true in most cases, whether it’s the wife who first viewed the apartment and the husband must now be convinced, or the senior citizen who identifies a 55+ community but must now talk it over with skeptical children.  In other words, don’t just focus on the person who made the initial inquiry.  It is often more important to sell to the party who was not present when the property was first viewed.

As the Student Housing Industry continues to mature, most CMO’s are aware of the need for a robust, year-round marketing program.  Targeting students used to begin in January and end in May.  Today’s student properties incorporate resident functions, social media, web presence, reputation management, and traditional marketing strategies into a 12 month program geared at building a sense of community and a recognizable brand.  While these robust programs can make identifying the source of traffic and quantifying the ROI on marketing spends very difficult, it also means that prospective residents are very familiar with our properties by the time the leasing season gets cranked up.  But how do we sell the property to the parents?  Below are 3 ways that you can target this all important decision maker and ensure that they are happy to pay the rent each month!

• Get parent testimonials during lease renewals or lease signings.  Offer a free Starbucks card to any parent who provides feedback via email or on a review site regarding the ease of move-in, convenience of rent payment or overall satisfaction with the operations of the office.  It is not just the younger generations who value the feedback of their peers!
• Get their email address.  Have your CA’s acquire the parents’ email addresses on the phone or during the initial tour.  If received on the phone, send the parent an email and Cc the student. (Cc’ing the student is very important, as generation Y hates any lack of transparency and will want to be privy to the conversation).   The email should be short and personal.  It should explain that their son or daughter has contacted the property and you are writing to simply introduce yourself.  It should include pictures, floor plans and pricing as well as an attachment with some testimonials from both residents and their parents.  It should conclude by providing a good contact number and an invitation to either call or visit the property if they have any questions.  Finally, include a coupon for a free coffee or sandwich from a local restaurant or coffee shop for the next time they are in town.  With the click of a mouse you will become the parent’s first choice. This will help overcome any price objections by demonstrating value and customer service.
• Direct Mail.  As the postal service continues to scale back operations and mail volume declines, direct mail is becoming a viable marketing source for the older generations.  Have a direct mail piece drop during the Thanksgiving and Christmas Holidays while the children are at home.  Direct it to the parents and it may become the catalyst for a dialogue between parent and student about their housing plans for the following year.

Make no mistake, if the student does not consider your community as a housing option, any of the above suggestions will be futile.  However, marketing to the parents can be an extremely effective compliment to your existing student focused strategies.  Parents can’t make the sale, but if they are not on board they can certainly break it.

“Below guest blogger and CLASS Leasing Specialists James King weighs in on the new changes to Facebook:

The team at Facebook has finally thrown down the gauntlet and is poised to show the world that it can hold its own against search engine giant, Google. Early in January, Facebook announced its new social search engine, called “Graph Search”. Facebook plans to change the way we search by using the personal data of you, your friends, and the 1 billion other users of the social media giant. It works by taking the likes, check-ins, and locations of all the people, places, and things on Facebook and indexes all of that information into a search engine. Now, a user can search “People who went to University of Georgia and like R.E.M.” and get a list of all the Facebook users that meet that requirement. With this switch to a more social search engine, now is a good time to make sure your Facebook profile is up-to-date.

In addition to looking up individuals with the new Graph Search, it is also possible to look up pages of businesses and landmarks. Prospects can submit searches like “Apartments in Sarasota, Florida” or “Townhomes my friends have been to” and receive a personalized list of apartments, emphasizing the ones that have more likes and activity within their group of friends. We all know that word of mouth is one of the most valuable marketing tools a manager or leasing agent has at their disposal, and this brings those personal endorsements to a more public scale. Now every time a friend of a resident searches for apartments through Graph Search, your page will pop up on the top of the listings. That is, of course, as long as your residents have liked or checked into your apartment community. Maybe now is the time to take a look at your Facebook strategy before Graph Search goes live within the next couple months.

There are several ways to stimulate the number of likes on your Facebook page: -Add a flyer promoting your Facebook page to the leasing office and make sure your residents and prospects don’t leave without one!

•  Insert a link to your Facebook page in your e-mail signatures and website. I also make sure to put links in my Craigslist ads to make sure new prospects see the most updated specials and offers.
•  Many residents might not want to add your page and be spammed with links they care little about. Make sure the links and statuses you are posting are of value. One great selling point is that Facebook and Twitter are great for distributing information about events and news on-site quickly.
• Utilize QR codes and text messages to make it easier for residents to ‘Like’ you. Residents can text “like YourFacebookPage” to 32665 and automatically become fans without having to get on a computer. Alternatively, they can scan a QR code with their smartphone (Kaywa is a great source to generate free codes) and jump instantly to your Facebook page.
•  Offer a small incentive for people to like your page. For example, if a prospect is ready to submit an application, offer $5 off the application fee in exchange for them to like your page. They save $5, and you gain more visibility with all of his/her Facebook friends and acquaintances.

Remember that social media growth is a marathon and not a sprint, and that consistent work is key to build a strong social media base. By re-examining your Facebook page now, you will be a step ahead of your competitors and will look even better in front of prospects searching the web for their new home. Check out the video below for an example of the Graph Search in action:”

Video of Facebook Graph

Thanks for sharing your tremendous insight James!

When leasing apartments it is important to give some thought into the buying behavior of our potential residents. In most cases, a decision to lease an apartment is not made entirely by the prospect who tours the apartment. When there are other occupants living in the unit, their feedback becomes essential. Even when the apartment is for only one person, most prospects will consult a friend or relative for advice on where to live.

Buying behavior tells us that the person who first finds the apartment will become a proponent of leasing the unit. The other party who was absent at first contact becomes the opponent of the purchase and immediately assumes the role of devil’s advocate. For example, if you show an apartment to a guy and he returns later with his girlfriend, the guy will assume to role the proponent while the girlfriend will be the party that still needs to be sold.

That is why it is so important to get the contact information of everyone who will be living at the property. In most relationships, whether it be a companion or roommate situation, the two parties will choose different stances on the purchasing decision. Therefore we need to focus on not just the party who inquires about the apartment but also the party who is absent during the initial inquiry.

The next time someone views an apartment without their roommate, get the address of the roommate and send them a quick note letting them know you can’t wait to meet them. You should also shoot them an email saying how much they will love the community and attach a gift card or coupon for a local restaurant that you have teamed with for cross marketing. The roommate who is absent will be blown away that they received the note and email prior to even viewing the property. They will come in with a “softer opposition” to buying and you will certainly set yourself apart from the competition.

This same technique can be used for first time renters who will be consulting with their parents prior to leasing. See if you can get the email address of the parents and drop them a line explaining why their son or daughter will be comfortable and happy living at your community. You will immediately get the seal of approval from mom and dad.

When speaking with a prospect, try to determine EVERY person in their life that will be an influencer in the decision. Then target those influencers with thank you notes, emails and phone calls. Your prospect will trust the opinion of their family and peers so go the extra mile to make sure they will be an advocate for your community!

Traditional marketing is dead! Or so claims The Harvard Business Review.

But is it really dead, or has it drastically changed along with the rest of the today’s communication landscape. With social media, hundreds of new channels have been opened resulting in a constant bombardment of product messaging. So how does your message stand out in such a red ocean? People hate to be interrupted (Pandora commercials), but what about being disrupted? And what is the difference?

There is much debate about the meaning of disruptive advertising, but I describe it as “what the heck was that?” advertising. And to get that reaction today, you have to go over the top! Maybe that is why the Old Spice or Dollar Shave Club campaigns were so popular. Much like the popular show Family Guy that goes over the top with every joke, todays marketers need to bring the heat if they are going to get the attention of a consumer.

Nowhere is this more evident than in the multifamily industry. Whether it is the generic “Free Rent” or “Now Leasing” banner, or your local Craigslist page, it’s almost as if our industry is afraid to stand out. But that is exactly what needs to happen in today’s leasing landscape. When marketing an apartment, remember that the attention span of a consumer is shorter than ever. If the image and message does not disrupt them, they will not notice.

Below are 3 “Disruptive” apartment marketing ideas.

1. Branding the toilet paper. For a student property in Michigan, hundreds of rolls of toilet paper were purchased with the words “tired of your crappy apartment call….” and the logo printed on each square. These rolls of TP were then placed in bathrooms all over campus.

2. Disruptive Images. Images like this completely random picture of Jeff Goldblum might seem strange to some CMO’s, but when placed on a stall in a bathroom you get disruptive marketing. An image like this with an apartment’s name or website will certainly get attention.

3. Burritos on a Bike. The Leasing Director at a property in Texas recently purchased $100 worth of $1 burrito’s, put them in a basket on a bike, and road around the property and the town handing out burritos. The reaction on Facebook and Twitter to the burrito bike stunt drew traffic and renewals for the property.

Stop thinking about how best to describe your property, and start thinking about how to disrupt the attention of your prospective renters. If they see your message and it is interesting and outside the box, they will remember your brand!