Applying the Challenge(r) Sales Model to Multifamily Selling

Regular readers of this blog already know our thoughts on the need for multifamily operators to fundamentally change their approach to sales. They also know our feelings on the need to create a real conversation about how operators should manage the sales function today and in the future.

We were quite excited to see the current moving in the right direction this past June when we had the opportunity to present our research and results on selling at the NAA conference.  Not only did we get a standing room only experience during the presentation, the conversation afterwards and on the trade show floor showed how far sales has moved up the list of attention.

We were encouraged not only by the conversation, but also the familiarity with some of the broader research into effective selling.  Maybe it’s the fact that we’re clearly past the peak of the recent multifamily performance boom, but we’d like to think that our contribution has had some impact as well.

One of the most common themes we’ve been asked about is how the research done by CEB that led to the book The Challenger Sale can be applied to multifamily sales.  We love that question, as this research is some of the best ever done into what actually causes successful sales results, and is a core part of what led to our conclusion that the multifamily industry was past the point of desperately needing to change its approach.

It also leads to a great set of questions and insights.  Because while the research certainly applies, the manner in which it is packaged does not always directly apply to multifamily sales.  The Challenger Sale (as the book is positioned) is focused far more on B2B, complex sales where demand is far more variant and influenceable than multifamily.  

We’ll share some additional insights into some of the core differences in a future post; but for the purposes of this post let’s highlight two of the components that make multifamily selling unique:

• Renting an apartment is an infrequent, high risk purchase decision that creates significant risk for the buyer (rent is typically the largest single expense in a household).  The high consideration nature of this sale makes the decision mirror many aspects of complex, B2B sales even though it is not B2B.
  
  
• Demand in multifamily is driven structurally (as the renter has a need) and cannot be created like it can with other high consideration purchases.

Additionally, the nature of the sale (let’s be honest) isn’t all that complex.  The feature sets are relatively limited, and pricing is typically out of the control of the sales (leasing) team, so negotiation is also minimized.  Therefore, there are limited opportunities for leasing associates to be “challengers” as described in the research.  

But this does not mean that there aren’t very important applications to take from the research and apply to how we sell in multi-family housing. For example, with a little translation, the five archetypes of sales have great application to multi-family housing.  Let’s take a look.

The first three profiles we’ll highlight have similar traits:

Relationship Builders:  These are the people for whom being liked is the most important attribute.  Be careful though, a lot of our training, reinforcement and management messages inadvertently teach that the #1 job of a leasing agent is to be liked.  You may be asking, “What’s wrong with being liked?”

The answer is that when being liked is the #1 goal, it is often accompanied by the failure to control the process. The leasing associate ends up with a real discomfort with the uncomfortable nature associated with the decision the prospect is trying to make.  It often leads to the failure to create any real value, or to have any real impact, and adds to the reluctance that naturally comes with this type of decision.

Hard Workers:  These are the people that managers love.  They work hard (as the name implies) and are willing to do anything.  They go the extra mile to do what it takes.  The problem is that they tend to be reactive and thus are not particularly effective.  They can also frustrate prospects by “overselling” and create more complexity and confusion, rather than eliminate it. Despite their approach, they get just enough sales to keep their job; however, if they would learn a better approach, their success rate will skyrocket.

Problem Solvers:  These are service people in salespeople’s clothing.  In leasing, they come across very similarly to the relationship builders and suffer from many of the same problems.

The next profile, unfortunately, is what a number of multifamily executives confuse with a sales personality.  

Lone Wolves:  These are the rule-breakers, do it my way or don’t do it types.  They don’t follow process and create disruption.  They do, however, often put up very good sales numbers (which is the only reason they’re tolerated).

I previously said unfortunately, because while some of these types are successful - and it's crucial to reiterate that some lone wolves put up good numbers - their success is highly unpredictable.  Their behavior can be highly disruptive; when you have a few of these types you often think it’s no big deal because their performance makes up for their frustration, but building a team of lone wolves is literally impossible.

The last type is the one where the most confusion exists.

Challengers:  These are the people who focus on being relevant and realize that by being valued they’ll be liked.  A Challenger is not a jerk who disagrees and challenges for the sake of it.  Rather they are the professional, who realize the complexity and difficulty associated in making a decision as important as where you’re going to live.

They realize the stress of the decision naturally makes the prospect uncomfortable - and they’re comfortable with that.  They know their knowledge and experience put them in the unique position to truly help their prospects.  They’re teachers, who focus on curating and supporting the decision making process.

They know that if they’re not leading the process, the likelihood of a good decision and outcome is greatly reduced.  As a result, they command the process in manner that is not aggressive, but rather similar to a doctor with a strong bedside manner leading a patient through a stressful experience.

Lastly, do not confuse the Challenger with the myth of the natural born salesperson (if one exists, they are far more likely to be a Lone Wolf). Challengers are taught and develop the skills that make them so valuable.  

They rely on a system that unlocks their talents and enables them to produce superior results - for their residents and their employer.

Note: The term Challenger is a registered trademark of the Corporate Executive Board. D2 Demand is not an authorized provider, and this blog derives solely from reading the book referenced and opining on how it may teach us things about our industry. Nothing in this blog should be interpreted as part of the CEB’s Challenger methodology or is in any way associated with, or endorsed by, the CEB.