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There are some service providers that have my unwavering loyalty. To name a few:
- My dentist – The staff is friendly, welcoming and reassuring, the office is immaculately clean, the receptionist always asks about my spouse and kids by name, and they give me a little lavender-scented towelette at the end of my dental cleaning to ensure there is no toothpaste on my face when I leave.
- My hairdresser – She always greets me with such enthusiasm and asks about my spouse and kids by name, offers me a variety of beverages (even champagne if it’s an evening appointment), and gives the best scalp massage as she’s rinsing my hair.
- Kanpai sushi – Though I only get to go every couple of months, the entire staff stops what they are doing to greet me when I come in, the wait staff knows my beverage of choice and that I always order a crunchy roll, and they always ask me about my kids and comment on how they can’t believe how old they are already and that I must bring them in for dinner one of these days.
The common theme here is that they do the basics very well: they make sure that I know that they know exactly who I am (by addressing me by name and asking specifically about the people who are important to me) and they are always happy to see me. They also find small, thoughtful ways of making me – and their other patrons – feel special. The lavender-scented towelette, a 2-minute scalp massage, remembering my “usual” order.
These special extras don’t cost a whole lot. They might cost a little time, some focused attention, less than a dollar in materials. But they sure make a difference in my level of loyalty. Even when rates have gone up, it’s an easy decision for me to stay. My new insurance doesn’t cover 100% of my dental costs, but it’s worth the co-pay for me to stay. My hair cut and my “usual” lunch costs have inched up over the years, but, again, it’s an easy decision to stay because I can’t imagine any other service provider treating me so well or caring about my preferences in the same way.
The SatisFacts Index shows that when asked, “How likely are you to renew your lease?” the breakdown is this:
Most residents expect that another year at your community will include a rent increase, so if you are encountering major objections it may be time to examine the issue more closely. Is it a major life change, such as a job change or buying a home, or is it something else? Neither our residents nor any of us feels good about paying more for indifferent or poor service. If residents are insisting that they “just need a change” or need a different floor plan or more or less bedrooms, or any number of other manageable objections, offer solutions and then dig a little deeper. Ask what is most important to them about the community they live in. Ask if there is anything in their home that needs attention. Discover if, in their experience, life at your community is worry-free or worrisome, as Lia Nichole Smith, our VP of Education and Consulting, likes to say. If 1 out of 4 residents can only say they are “Somewhat Likely” to renew their lease and 1 in 7 say they “Don’t Know,” there’s a great opportunity to connect with your residents, let them know they are a VIP, and help them gain confidence in making their renewal decision!
By Lia Nichole Smith
Did you know that 67% of customers who stopped patronizing a business did so because an employee treated them indifferently? And of that 67% here’s an even more startling breakdown:
- 96% will never complain
- 91% will never buy from that business again
- 100% will tell at least 9 other people
- 13% will tell at least 20 more people
So how exactly does this relate to the multifamily industry? Well, residents are customers and many of the actions they take towards businesses such as retail stores, banks and other services translate over to our world as well. Imagine losing 67% of your resident population, 67% of your occupied apartments. That’s a staggering amount of lost revenue and will surely turn your community into a ghost town.
Making sure your community never suffers a significant loss starts with the people hired to manage and maintain it. In “Customer Astonishment, 10 Secrets to World Class Customer Care”, Darby Checketts outlined some ready to implement steps that every community will find useful. First things first, start at the employee level.
- Hire the right employees
- Train employees to deliver superior service
- Treat employees with respect
- Show employees how valuable they are
- Measure performance daily
- Reward superior service
Establishing superior service begins by understanding what is most important to residents. Surprisingly enough, what matters most to residents has little to do with price or amenities. According to the 2011 SatisFacts Index, these are the top 5 renewal drivers (in order of importance) when it comes to a resident’s overall likeliness to renew:
- Promptness of response to calls and emails
- Follow-up on completed service requests
- Responsiveness and dependability of the office staff
- Courteousness and professionalism of the office staff
- Apartment appearance and condition
Residents do not choose not to renew their lease purely based on a rent increase. In fact, most apartment renters are conditioned to expect some type of an annual increase. What residents are most concerned about, as our research has shown, is the level of service they are receiving for the amount they are being asked to pay. When these two things are out of synch, residents are more inclined to spend their rent dollars elsewhere. By focusing on what matters most to your residents, and not what we think matters most, will ultimately make the difference in the amount of renewals you are able to secure each month. Here are some best practices your team can execute as they relate to the top 5 satisfaction topics:
Promptness of response to calls and emails – each community should have a “communication standard” in place. A communication standard is simply a timeframe for responding to residents. An example would be “all calls and emails received by 3pm are responded to by the end of the day and anything after 3pm will be returned by 10am the next business day”. Once your community has established this standard, be sure to include it in your outgoing voicemail and auto-responder for emails so that residents are aware of when they can expect a response.
Follow-up on completed service requests – according to the 2011 SatisFacts Index for Annual Surveys, only 47% of residents said they received a follow up call after a completed service request. That leaves 53% of residents out there that could potentially have outstanding or unresolved issues. Having a standard in place for 100% call backs will ensure you are able to catch any problems before they become bigger issues.
Responsiveness and dependability of the office staff – trust goes a long way when it comes to resident retention. Residents need to feel and believe that their concerns will be addressed and resolved once the office has been notified. Meeting expectations and deadlines are vital to establishing that much needed trust.
Courteousness and professionalism of the office staff – there is a big drop in overall performance residents feel as a prospect then when asked again at time of renewal. According to the SatisFacts Insite Unclosed Prospect survey, apartment hunters scored the office staff a 4.55 on a 5 point scale; this number dramatically dropped to a 4.07 on the Pre-Renewal survey. Remembering to do all of the little things such as greeting from a standing position, using the resident’s name and comfortably establishing a rapport goes a long way, even with existing residents.
Apartment appearance and condition – at every interaction with a resident, asking the question, “How’s everything going in your apartment home?” can make all the difference here. Oftentimes, residents simply forget to notify the office about small maintenance issues, as demonstrated in the 2011 SatisFacts Index for Annual Surveys. 24% of residents had outstanding maintenance issues the office was not yet aware of. These issues can be as simple as a broken window screen to something more extensive as a leaking kitchen sink.
Residents have spoken and clearly identified what matters most to them. The good news for us is the top 4 factors have absolutely no financial impact on our budgets. These factors have everything to do with hiring the right people, establishing and adhering to set standards, and maintaining a high level of service every day and with each resident interaction.
“Getting Inside the Head of Today’s Online Renter”
Results from this comprehensive national study conducted by SatisFacts and 30 Lines are now available!
Among residents surveyed in our national study entitled “Getting Inside the Head of Today’s Online Renter,” over 62% reported owning either an iPhone or Android smartphone, and 26% said they used their mobile device to help during their most recent search for a new apartment. Surprise you?
What do renters want? What makes them tick? What do they expect out of their rental experience? How important are ratings and reviews? How do they shop for apartments, and how does it impact your marketing efforts? We asked, and now it’s ready for YOU. “Getting Inside the Head of Today’s Online Renter” is the most comprehensive analysis ever conducted in the industry on the impact of technology and social media on apartment marketing and operations. Feedback from thousands of residents from 20 diverse management companies — plus insider input from industry experts like Lisa Trosien, Tami Siewruk, Dennis Smillie, Sue Weston, Jen Piccotti and more — can help you make more informed marketing, operations and technology decisions.
Authored by Doug Miller of SatisFacts and Mike Whaling of 30 Lines, the ebook is now available: TheOnlineRenter.
As Steve Gilbert notes, “Look at this as a road map, not the bible in determining how to best prioritize your operations and marketing strategies. Quality, as opposed to quantity, is more important than ever.”
Hopefully, we all understand very clearly how critical the move-in process is for establishing a positive resident relationship from Day 1. However, in the hustle and bustle of the daily grind, an astonishing figure has come to my attention:
According to 2nd Quarter 2009 data from SatisFacts Research, only 73% of residents indicated that all appliances and fixtures worked properly upon move-in!
That means more than one-quarter of all new residents had an appliance or fixture that did not work.
Houston, we have a problem
Are we okay with this stat? I hope not, because unresolved issues at move-in reduce the percent of residents “very likely” to renew by one-quarter!
So, what to do? Let’s re-evaluate the make-ready inspection process. One tip I learned from Bill Nye is the concept of “walking right,” or “follow the wall.” This means, for the final inspection, the maintenance team member enters the apartment and follows the wall to the right stopping to check each light switch, outlet, phone jack, window treatment, doorknob, appliance, light fixture, etc. Eventually, you end up at the front door again.
Rework is always costly – whether in time, materials, customer patience, or all of the above. Ensuring the resident’s new home is truly in move-in condition will be the first critical step in assuring the resident they have made the right decision in making their home in your community.
What make-ready inspection tips are effective for you?
I have greatly enjoyed the Dos Equis ad campaign spotlighting ‘the most interesting man in the world.’ He’s like James Bond and George Clooney rolled into one. The idea of being charismatic and interesting to draw others in is an often-used relationship building (and sales) tactic. However, the idea of being the most interesting man (or woman) in the world, and trying to convey the actuality of being that interesting most often are two very different things and have very different results.
He is the most interesting man in the world.
When it comes to establishing or solidifying connections with prospects, existing residents, co-workers and even vendors, it is more effective to find out what is important to that person, their expectations, questions, objections, interests, etc. rather than showcase how interesting or fabulous your community, apartment homes, amenities, rental rates or staff are. That information is best and most impactful when used in response to the other person’s interests.
In Nicholas Boothman’s September 2, 2009 blog post, Humbility, he shares a story illustrating this point exactly:
“Benjamin Disraeli became a Member of the Parliament of Great Britain at thirty-three, and its prime minister at sixty-four. Disraeli’s main political rival was William Gladstone, a four-time Liberal prime minister who was renowned for his abilities as a speaker.
One evening, Mr. Gladstone took a young woman out to dinner: the following evening the same woman had dinner with Mr. Disraeli. Asked later what impressions the two distinguished men had made upon her, she replied, ‘After dining with Mr. Gladstone, I thought he was the cleverest person in England. But after dining with Mr. Disraeli, I thought I was the cleverest person in England .’”
No matter what the relationship, making the other person feel like ‘the most interesting’ or ‘the cleverest’ is more memorable than the most perfectly crafted sales pitch or renewal incentive.
Home sweet home
or
You call this a "piece of the pie?"
I just got back from Boise, Idaho recently to visit family and enjoy the beautiful scenery of the Northwest U.S. I found out a cousin who has been living with her parents for various family reasons is now looking for a rental situation. I asked her what kinds of deals she was finding in the apartment market in Boise, and while she told me what I expected to hear – that the move-in deals were pretty amazing – she had chosen to submit a rental application for a single family home with a yard. This is no new story to any of us, and she shared all the reasons we’ve heard before:
- Fenced in yard
- Same price as an apartment
- No shared walls
- Lots of space
- And the neighborhood even had a pool and clubhouse!
Yes, the shadow market is alive and well, there’s no point in denying that. We’re competing with it for prospects as well as our existing residents! While there are many experts on the leasing side who can offer strategies and approaches to get new prospects in the door, there is a need to continue to use some of these same strategies to keep the residents we have. Remember the TV show, The Jeffersons? The theme song is all about moving to a “deluxe apartment.” How do we re-kindle that pride of residency in our own community? When it comes to existing residents telling us at renewal time that they are considering renting a single family home or condo, it may be an opportune moment to remind them of some of the extra costs that could be associated with renting a single family home:
- How quickly are maintenance issues resolved?
- What will it cost to maintain lawns/landscaping in summer or sidewalks and driveways in winter?
- Who pays for water/sewer/trash?
- What will utility bills look like in order to heat/cool the home?
- Who provides window coverings?
- Does the neighborhood have a pool, clubhouse, fitness room? If not, what will it cost for memberships at local facilities?
While the initial monthly rental rate may be equal to or better than the resident’s current rate, what other costs do they need to consider? And, ultimately, the renewal decision is most influenced by the service delivery the residents are experiencing. Are you offering your residents service that can not be matched? Meaning, do you return their calls and emails same day? Are their service requests completed in 24 hours, and are they completed right the first time? And as the theme song says, do your residents feel they have “finally got a piece of the pie?”
The NAA Education Conference was a whirlwind day trip for me. I was only able to fly in on Friday morning and fly out that evening. It was a great experience! I got to match many names with faces and have a some great conversations. There were very positive comments flying around about how impactful the conference had been for the attendees as well as the exhibitors.
As you can imagine, knowing that I only had 1 day to dive into the conference, I had to put tremendous faith in the airlines. There was no room for delays or flight cancellations. Knowing that I could not allow for any margin of travel error, I chose to fly Southwest. They are known for their great track record for on time departures, and when it comes to Las Vegas in particular there are no other airlines that can even come close in the reliability rankings. I don’t care for the “cattle call” although they have improved that process somewhat. I am a bit tired of the “no frills” peanuts. But I can count on them, and they did not fail me on this trip.
There was a twist however. I arrived safely home on Friday night, and in the morning I found an email waiting for me from Southwest.
With all the emails – both personal and junk mail – I receive on a daily basis, this actually did stand out. There was nothing more to the message. Just this thank you, with a subtle suggestion to share my positive experience on their own Southwest Travel Guide page.
You may remember a previous post in which I shared an idea of asking for positive public feedback from great residents who were unable to renew for whatever reason – suggesting they leave some good notes on certain apartment search websites. Southwest is essentially doing the same thing. They know they gave me an on time arrival and departure, they are acknowledging my patronage, and they are hoping to get a little extra mileage out of a satisfied customer. I think it’s a great idea. They have made it easy for me to leave some happy thoughts for another potential traveller to read.
So, what are you doing to make it easy for your residents to leave some positive feedback? I’m going to leave some positive feedback on the travel guide because as far as I’m concerned, when it comes to day trips or any travel that has no margin for travel error, Southwest – I’m forever yours, faithfully.
Check out Doug’s latest blog post at NAA’s Aptly Spoken: http://www.naahq.org/blog/lists/Posts/Post.aspx?ID=88
“… While I always intuitively knew that great service paid off (this being engrained in my genes), I became very dangerous over the years as I have been able to back up these feelings with the results from surveys we have completed with well over a million units.”
Summer is here, and we’re all waiting to see what levels of turnover will occur. Our typical summer experience, especially where our maintenance teams are concerned, is an increase in turnovers and the increased focus on getting newly vacated apartments ready for potential new move-ins. The result? Existing residents may have to wait a little longer to have a service request issue resolved. It might take a little longer to hear back on the status of an ordered part or a scheduled vendor.
But wait! Doesn’t it seem strange that we would prioritize empty apartments above our rent-paying customers? It’s almost as frustrating as standing in the check-out line, money in hand, to buy the perfect prom dress, but the clerk is busy dressing the mannequin in the store window and can’t be bothered. Something’s wrong with this picture!
We see the cycle. We know the cycle. There are times of the year that typically bring an increase in turnover, and times of the year that typically experience less turnover. Knowing this, what if we did something radical – something that turns what has been the norm in our industry for years and years on its ear? What if we reduced or retired our monthly resident events (that may draw a handful of attendees) and shifted those dollars to that time of year when we know turnover is traditionally heaviest? What if we shifted those dollars to hire temporary, part-time maintenance help to ensure our existing residents were never affected by the ups and downs of our business cycle?
Depending on your location, $6,500 can hire a part-time technician for over 430 hours – which equates to 30 hours/week for 14 weeks, more than covering the typical heavy turnover season. This is a strategy that provides a direct return on investment. Maintaining steady, consistent focus on reducing outstanding maintenance issues translates to higher resident satisfaction which results in increased lease renewal likelihood.
Resident events, move-in gifts, hard copy newsletters are great as icing on the cake when service delivery is top notch and running like a well oiled machine. How many of us can say with 100% confidence that this is the case for our property or portfolio? I know there are many of you out there who can! And there are many others who are making great strides. But as we all focus on minimizing turnover, the foundation of retention is how well we perform in service delivery. And it can be those part-time, temporary maintenance Boys (or Girls) of Summer that can make all the difference!
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