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Brent Williams' Apartment Blog

Thoughts, comments, and ideas about the overall multifamily industry, as well as a property-specific focus on resident retention and apartment marketing.

Shifting From a Sales-Oriented Model to an Experience-Oriented Model

Last week, I discussed what it would be like to be an exceptional apartment community, and how that would affect our view of our community, our confidence in our product, and our entire operational process.  I would like to expand upon one of the bigger elements:

Creating a community that truly provides a memorable experience shifts
work from a sales-oriented model to an experience-oriented model.

What does that truly mean, and why is it so difficult?  As I mentioned, if you have a scarce product, and you have high demand, sales happens easily on its own.  The problem is somewhat of a “chicken and the egg” scenario, however, because how do you allocate labor to creating an experience, when you need that labor to plug the holes from residents walking out the door? 

This is where the “bravery” part comes in.  Too many owners like to run their communities short staffed, and while that may work for a short period, who really believes a run-down, over-worked, and generally exhausted employee is going to be able to help create an experience that is memorable for their residents?  Even staffed at normal levels doesn’t work because the duties require a temporary overlap.  Efforts into creating a unique community that result in lower turnover don’t manifest immediately, but rather build up over time, which means that the “back door” won’t be shut immediately.  So additional labor is needed in the short term to build up the “experience” while leasing continues to maintain occupancy. 

Therefore, owners who want to create an exceptional community must invest in that process, at least in the short term.  Those costs include additional labor, consulting to create that “vision”, and maybe adjustments in amenities to create a cohesive message.  But not to fear, the rewards are significant.   Here is a quick list of the income improvements/cost reductions possible:

  • Decreased resident turnover.  Pretend for a moment that 60% turnover in our industry is not normal.  What if we halved that number?  That’s $270,000 for a 300 unit community using $3,000 turnover cost.
  • Increased rent.  Back to the Apple analogy from my earlier post, people pay a premium for things they love.  Plus, the basic laws of supply and demand will drive up rents at your property.  I would estimate people will pay at least 5% more for this type of property, which equates to another $180,000 more in the bank after a year.
  • Decreased advertising.  Why advertise so much if you don’t have anything to rent?  Besides, the experience you have provided is perfect for resident referrals, which is often free when done correctly.
  • Decreased employee turnover.  As Anne Sadovsky mentioned in her recent webinar, the top reason people work is to make an impact and feel like they are part of something special.  The beautiful thing about the apartment industry is that we can affect many people’s lives in a very powerful way, and this strategy is perfect for that.  Who wouldn’t want to work at such an amazing property?

These are obviously rough numbers, but hopefully everybody can see the scope of such a project.  But the investment must be made in order to reap the rewards, and that takes a brave owner and property management company!

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This comment was minimized by the moderator on the site

I couldn't agree more, Brent. I recently commented that apartments are both a product and an experience and that, yes, it behooves companies to recognize the importance of making that shift from sales to experience orientation. You forecast, quite aptly, the likely benefits of making such a shift. Nicely said.

  Jeffrey Spanke
This comment was minimized by the moderator on the site

Brent, I would draw a parallel with my business development efforts. Cold calling is one-dimensional and one starts with a name and infrequently ends up with a relationship. Some are more successful that others, but in general, the yield for this type of an approach is low. The way I prefer to approach building a business is to really take the time to understand the market, the clients, the competitors. They get to know me, I get to know them. Relationships build AND LAST because they are built around a shared interest. With apartment communities, the same thing applies. An experiential orientation allows the multifamily professional to demonstrate his or her passion about the work and the community. It is not just about growing a business, it is about establishing a lifestyle and brand. Being a low-cost provider is one thing. Being a provider who operates efficiently at lower cost, allowing for operational flexibility, is quite something else.

  Charles Fiori
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Thanks for the comments, Jeffrey and Charles!

  Brent Williams
This comment was minimized by the moderator on the site

Great insite Brent! Our clients who opt to employ our temp leasing agents, especially during busy seasons, find they capture more leases and their staff executes better relationships both with current residents & prospects, due to having assistance, therefore more time to spend with either/both. It's a win/win for all! Even the best leasing agents that are pressed with too many tasks, prospects waiting for tours, renewals to pursue, etc. often rush the process and these effects can cost leases.

  Laura Bruyere

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