Every once in a while I Google “Resident Retention” just to see what comes up. And each time, I am disappointed in the results. In an industry that has seen customer turnover fluctuate between 55 percent and 62 percent over the past 10 years, do we really believe that the answer is better move-in gifts, cute door hangers and more pizza parties?
Some of the suggestions I read included providing “Carefree” gum as a leave-behind gift for a completed service request, monthly Sunday brunches, resident birthday cards, kids movie nights, and the especially poignant advice of, “Focus more on retention!” Helpful.
Here’s a scenario I like to share with new clients who feel that resident events are critical to their retention program, though their resident satisfaction scores have real opportunities for impactful improvement:
Ms. Jones is going on Day 3 of being without A/C during a week-long heat wave. She has submitted her service request online and has also called the office. As she looks out her open window, desperately trying to catch a breeze, she sees the property manager directing a couple of maintenance techs on the set-up of chairs and tables for this afternoon’s resident pool party. How thrilled do you think Ms. Jones is about the upcoming pool party?
Not very. She wonders, “Why is the maintenance team gathered ‘round the pool when there is an HVAC emergency at hand?” An intended perk has now become a slap in the face. Ouch.
According to the 2010 SatisFacts Index, when asked what can be done to improve the community, residents ranked “Social Activities” #29 out of 30. All this hype about being 29th?
Social activities should never be the meat and potatoes of a retention strategy. Think of them as gravy. On its own, it tastes good but is not ultimately satisfying. You miss the meat and potatoes when they are not there.
Meat and potatoes consist of the residents’ ability to a.) Communicate with your team quickly and easily, and b.) Get service requests resolved promptly the first time they report it. The more outstanding maintenance issues there are on a property, the less likely the residents are to renew their lease.
We are approaching the part of the business cycle where more leases expire, and there are more vacant apartments. More vacant apartments means more man hours for turnovers. The leasing team is running at top speed and is pressuring the maintenance teams to hand over rent-ready apartments. The focus is on turns, and yet the service requests from rent-paying residents don’t slow down. This is right when A/C season hits, resulting in even more work orders to compete for attention. The compounding effect means it takes even longer to get to the service requests. Unfortunately, just as the service is declining in the eyes of the residents who are waiting for their issue to be resolved, their lease renewal letter arrives in the mail. Not good. Especially since in those markets where market conditions are tightening up, properties are finally able to begin rent increases. It is critical that perceived value by existing residents be at its highest level when a rent increase awaits them in their mailbox.
Look at your resident activity budget. What if you re-allocated those budgeted dollars to bring on a part time maintenance tech for those heavy turnover months, with the sole purpose of ensuring that service request resolution is not impacted by the increased focus on make-readies? This allows service to remain a priority, which has a significant impact when the resident gets that lease renewal letter.
Once you are confident your basic service delivery is performing at the highest level, then by all means bring on the gravy! Until then, let’s focus on the meat and potatoes.