When we lease apartments, we provide an “all inclusive” package.  Not only do our residents receive an apartment to stay in, but they also get free maintenance, often a pool to swim in, a gym to work out in, a clubhouse to hang out at and get a free cup of coffee, and other perks.  Rather than break all of these elements out into separate costs, we provide a nice, simple charge for everything in the community, providing them with an all-access pass.  Unfortunately, we treat these as bonuses and often don’t really place much care into whether these elements of our package actually ever get used.  But for a moment, I’d like to share a different perspective that shows that if we are not continually “selling” these amenities to our residents, they will likely not renew!

Rather than seeing our leases as just for an apartment that happen to give the residents access to amenities, let’s pretend that we break down the cost for each apartment.  So rather than one apartment that costs $1,200 to rent, we have:

Apartment Base Rent:  $1,040
Maintenance:  $50
Gym Access:  $40
Pool Access:  $30
Clubhouse Access (with free coffee):  $30
Resident Events:  $30
Courtesy Officer Charge:  $20
Landscaping/Grounds Upkeep:  $45

Total:  $1,285  (The bundled package gave them a special deal, most likely)

(Note:  These numbers are just for discussion purposes – actual numbers may be completely different, so let’s not get bogged down on whether this is the proper cost for each amenity.)

The Disappearing Value For Residents

Now, to take this perspective a bit further, let’s see all these items as credits.  In other words, the resident prepays $30 for clubhouse access, to which he/she can use throughout the month.  If the resident doesn’t use the clubhouse, get a free coffee, these credits are nonrefundable and disappear.

If we take this idea that the resident gets credits to use these amenities that expire every month, what happens to their sense of value if they end up not using any of the amenities every month?  The clubhouse is often the first to go, because let’s face it – it was often really designed to sell the community, not designed to actually be used by residents.  And besides, it is often locked up when the residents are actually at the community.  So those credits are almost never used.  Our resident events also often suffer, generally reaching only 25% of our community, leaving 75% with no value from this amenity.  This trend often continues through many of our amenities, which results in residents leaving tons of cash on the table.  So while they are spending $1,200 in rent, they may only be getting $1,080 in “value”.  So this resident went from feeling like they got bonus amenities to suddenly feeling like they overpaid, by spending $1,200 on a $1,080 apartment.  When words like “overpaid” and “not worth it” are driving the opinions of residents, there is a big problem.

Inspiring Residents To Use Their Credits

This means that in order for our residents to feel that they got a good value, they must actually use their credits/amenities in order to reach their rent amount.  In other words:

Apartment Base Rent:  $1,040
Maintenance:  $50
Gym Access:  $40  (They started a new workout routine!)
Pool Access:  $30  (They lounged at the pool!)
Clubhouse Access (with free coffee):  $30  (It was always closed when they were home)
Resident Events:  $30  (They never attended)
Courtesy Officer Charge:  $20  (They never had an incident and never saw him patrol)
Landscaping/Grounds Upkeep:  $45

Total:  $1,205  >  $1,200 they pay  (The amount they receive is comparable/above the amount they pay, so they are happy!)

I was reading a post about social media today, which said that social media can be used for selling.  He shared an example of how Burger King inspired him to get a cheap ice cream cone:  “It was hot out, and the cone was cheap!”

And it got me thinking about this new perspective about our residents having unused credits.  If a hot day equals a cheap ice cream cone, then a hot day can also equal a swimming pool that the resident already has credits for!  So why not periodically “sell” to your own residents the amenities that they already have credits for?  Schedule Facebook posts and tweets on Saturday and Sunday when most residents are available to entice the residents to lounge at the pool, even if it isn’t for a big resident event.  Or schedule 6pm posts when residents are getting off of work to motivate them to hit the gym.

In the end, we can tell ourselves that the resident has access to the community’s amenities, so it’s not our business whether they use them or don’t use them.  But who does it hurt if the resident doesn’t use the amenities and receive a good “value”?   The community!  So although it is completely in the residents’ hands on whether they maximize their stay at the community, it affects the community if they fail to do so.  So rather than say it doesn’t matter if they use the community to its fullest, we must consider that part of our job is to continually re-sell these benefits to our residents in order to maximize their value proposition.

With this thought process, we should always be selling.  We might have gotten our residents to prepay for services, but did they really get the value they signed up for?  If they didn’t, then they will be leaving!