Innovation is creating new opportunities for apartment marketers, who are redirecting their focus and spend in 2018.
At the end of 2017, Wood Partners took a deeper look at its marketing position and decided to make significant adjustments to where it spends its dollars.
“We are a merchant builder, so we are in full lease-up mode at all times, which requires laser-focused marketing,” says Steve F. Hallsey, Director of Operations at Wood. “We recognized last year that we are attracting more and more Millennials into our high-end properties and they are making their decisions on experiences and not by using the traditional marketing sources.”
During its past 10 lease-ups, Hallsey has seen Wood’s leases come from three major buckets: 50 percent came via the Internet (pay-per-click, ILS’s, property website, Facebook and Instagram); 30 percent came via organic marketing (property location, signage and lives/works in the area); and 20 percent via “experiences” (sense of community, onsite concerts, outreach and resident referrals).
That data helped Wood adjust for 2018.
“We have shifted more of our marketing dollars toward building experiences through spending more money in the third bucket,” Hallsey says, which makes or breaks leasing velocity for Wood.
Wood is not alone. Regardless of the avenue, companies plan to spend more money on digital advertising in 2018.
Kettler plans to increase spending on social media advertising and AdWords, an online advertising service developed by Google, where advertisers pay to display brief advertising copy, product listings and video content within the Google ad network.
For Fogelman Management Group, search-engine marketing (SEM) campaigns; social ads through Facebook, Snapchat and Instagram; and Matteport, defined as a 3-D tour comprising traditional photography and video, hold great promise.
Fogelman’s Chief Administrative Officer Melissa Smith says the company also has its eyes on market conditions. If the market becomes more competitive, the company will be ready.
“We are looking potentially at promotional items for aggressive outreach and resident retention as the markets tighten, without having to give concessions,” she says.
AMLI Residential, too, is exploring 3-D imagery for its apartments, along with virtual reality and augmented reality.
“We are focusing on ways of engaging differently with our residents through things such as text, chat, video and voice,” Amanda Johnson, AMLI’s Vice President of Marketing says.
Augmented reality also intrigues Jerry Perezchica, Director of Marketing, Decron Properties.
“As AR becomes more mainstream, we are seeing good examples from IKEA, Amazon and others to show customers what a product would look like in their home prior to purchase, such as a sofa or toaster,” he says. “Can we use this same technology to help customers envision what living in one of our apartments would be like by virtual staging with furniture and putting on the web, or adding to the experience while visiting a community?”
As Alexa, Google Assistant and Apple’s Siri are being integrated into more products, Decron wants to look at ways to integrate answers to customer needs, so its business can be served up within these voice assistants.
“For example, someone may ask, ‘What is an affordable West Hollywood apartment?’ or, ‘What properties accept pets and are near the beach?’ ” Perezchica says. “These are things marketers think about when crafting content strategies, but voice search is a new wrinkle for customer service or sales opportunities.”
Overall, Decron looks for technologies that enhance customer experience, have ease of implementation and are built upon a strong foundation.
“Does it enhance the customer experience, is technology fully functional, and is it fairly straight forward to implement?” Perezchica says. “We don’t need to be the first, or spend the most, but we look at trends and are always open to testing emerging technologies.”
“As marketers continue to move into the digital realm, multi-touch attribution is going to be front and center,” Jennifer Anderson, Director of B2B Marketing at RentPath, says. “They’re going to need buy-in from their operations and IT teams on leveraging marketing technology to mature beyond single-touch attribution. It’s archaic to credit a conversion to a single touchpoint, whether it’s the first, last or any other. Without a more sophisticated attribution model, marketers will face an uphill battle of justifying the additional investment into digital — particularly those channels that don’t drive acquisition but are important in generating early interest and awareness.”
As apartment marketers look to spend on digital strategies in 2018, traditional avenues could lose traction.
“We are probably going to lower our spending in traditional sources, such as the Internet, and spend in only a few sources,” Hallsey says.
Smith says that Fogelman plans to invest less on traditional collateral.
Other than print advertising, Johnson is not pinpointing any category for which AMLI plans to decrease spending in the year ahead.
“We have shaved expenses in other buckets to make our marketing efforts most relevant to our prospects,” she says.
“We are still focusing on PPC campaigns, but since the costs have been driven up because of competition we are engaging further in social media advertising, geo-fencing, in app mobile advertising and retargeting,” Jennifer Staciokas, Senior Vice President, Marketing & Training, Pinnacle, says.
“A newer focus for us is on influencer marketing via guest bloggers and event marketing, and we are starting to test chatbots.”
Eric Clark, Vice President Marketing & Strategic Development at The Bainbridge Companies, says “Budget-wise, we’re paying about the same amount for our keywords, and we’ve gotten smarter about them over the years. For example, we install real-time pricing into our ad word copy and use Yieldstar data to target our ads to the floor plans where we have the most availability that day. Additionally, due to the volume of data available, we are able to drill down to keywords that work best on a property-by-property basis to focus on what makes the most impact and at the lowest possible cost.”
Clark says his company’s social media strategy avoids “selling” through these channels.
“Social media is a communication vehicle to have a meaningful and enriching two-way conversation with our residents and potential residents,” Clark says. “We’re focusing not just on the traditional social media outlets like Facebook, but really looking at taking our use of Instagram and Snapchat to the next level.
Nationally, marketing expenses per unit in apartment communities increased 7.8 percent year-over-year, according to NAA’s 2017 Survey of Income and Expenses (I&E). This is somewhat higher than the average increase of all operating expenses of 5.4 percent. Marketing as a percent of total operating expenses has been stable, averaging in the 3.5 percent range for the past six years.
Beginning with the 2017 I&E survey, marketing expenses were further segmented into internet, print and resident relations, to include events and other outreach. Contact NAA’s Paul Yoon to participate in the 2018 survey, which opens in April, and receive a free copy of the results.
Read all of our coverage on 2018 digital marketing trends:
- Alliance Residential Marketing Focus: Keywords Not Ruling the Day - Cat Thomas, Director of Creative & Digital
- LMC Marketing Focus: CPCs, CTRs and Voice Search Trends - Morgan Porter, Director of Digital Marketing
- JVM Marketing Focus: Facebook Marketplace is Intriguing - Kim Morgan, Marketing Manager