Very few multifamily operators are satisfied with their leasing. Most have a sense that something is not quite right. Other than wishing for leasing agents to “be better at closing,” they may not be able to put a finger on the real issue(s).
In our research on multi-family demand management platforms, we have identified that this is fundamentally a lack of appropriate attention to “the last mile” of the leasing process. Multifamily operators expend significant resources – time, effort and money – to attract prospects to their communities, engaging in a wide variety of marketing activities to generate leads. Yet the process to convert leads to leases (sales) has gone relatively unchanged despite radical changes in prospect behavior (see Google’s seminal Zero Moment of Truth study for just one important component of that change). Whether in a bull or bear market, this places a hidden drag on NOI performance and portfolio value (though it’s admittedly easy to be complacent that sales is “good enough” when in a bull market).
Sales and marketing are the only open-loop systems in business. Open loop systems exist when parties or systems outside the control of the designer are a part of the system. For example, businesses have full control of their financial, HR and operating systems; but, to paraphrase a famous Norman Schwarzkopf quote, in sales and marketing, the market gets a vote. Your prospects fundamentally change how your marketing and sales efforts must operate on a day-to-day basis.
To design a leasing process that truly works and optimizes performance, you must orchestrate several functions, including: how you recruit, train, manage and coach your people, the technology you use and the systems and tools utilized by your leasing team to manage the process. All of these components must align with the unique path your prospects go through when learning about, assessing and deciding where they will call home.
To adequately address this area, operators must take a holistic approach to addressing “the last mile." While sales training is an important part of the solution, it is only a piece. Operators must address the “upstream” and “downstream” impacts associated with selling to today’s knowledgeable, sophisticated consumer.