The Demand Solutions Blog

I just got back from AIM last week, and it was quite the inspirational experience. As usual, the networking was great…a chance to catch up with many old friends and meet a few new ones. Here are key themes I took away from the sessions I attended and the conversations I had:

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There are many different opinions about the value of social media in multi-family housing. Readers of this blog should be pretty aware of mine. But the one thing that everyone seems to agree on is that ratings sites are important. There’s a lot of debate about what to do with ratings sites, but everyone seems to agree there’s some “there” there.

So I thought it would be a good idea to get a sense of exactly how important ratings sites are. The first step I took was to dig up some research I had done for a client back in February. In it I wanted to identify whether there was a clear “category killer” or whether multiple ratings sites were important. In an admittedly un-scientific way, I just looked at 10 communities in the Washington, DC market.

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So I’m at the NMHC Market Research Forum in Boston this past week to sit on a panel/workshop on revenue management. Mark Obrinsky, who heads up Market Research at NMHC and has been a good friend and colleague for roughly decade brings up an interesting question:

“(paraphrasing) So what do you think about longer lease terms? And by longer lease terms, I mean 3-, 4- or 5-year leases.” He hypothesizes that there’s a latent, older “renter by choice” demographic that could be tapped, particularly in urban markets. The theory is that these folks would choose to rent but for the fear of unknown and thus uncertain future rent increases.

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At AIM last week, I was up early for breakfast and wandered into the roundtable Lisa Trosien was leading, called “Talk Nerdy To Me.” If you’ve never experienced Lisa, you’re missing out on a true force of nature. I’ve barely woken up, and she’s already full of energy and just moving the discussion along—presenting interesting websites, asking the group questions and just generally always pushing forward.

Anyway, that’s not the point of this blog. About a third of the way through, she asked a senior marketing person (someone I’ve known for years and always watched what she’s doing as a bit of a bellwether for the industry) what she’s found to be the most effective marketing tactics these days. After a pause, the answer came back, “Well, I hate to say it, but it’s still the traditional stuff—driveby, website, referrals, …” [note: I would add ILS although this executive said they'’ve really cut back on ILS without any pain —maybe a good topic for a future blog].

I found that response incredibly interesting on two levels.

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Those of you who know me well know that my brother is a sales coach. Well, more than that but this blog isn’t really about him, so I’ll leave it as a gross simplification of what he does. He and I used to work together—he ran a sales team and I ran the service team for a membership group of travel agencies back in the 1990s.

One of the first things I remember he taught me about sales and marketing is that people are motivated by only two things—they seek to avoid pain and they seek to gain pleasure. But it’s not symmetrical. We’re actually wired to put more attention to avoiding pain than to seeking pleasure. That’s why it’s easier to sell something to someone solving a crisis than it is to someone who’s doing very well and says they want to do better.

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Amenity pricing can be one of the tougher things to get right—but also one of the most lucrative. So here’s the shortest blog I’m likely to ever write.

Do you put an amenity charge on south facing units? Why south facing (many of you may already have figured it out)? Because you have to have a south facing view if you want a satellite TV subscription. As a displaced Marylander who desperately wants to watch his Washington Capitals on DirecTV’s NHL Center Ice package (even this year, when they’re not playing too well), I can personally attest to the willingness to pay a segment of the market has.

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So here’s a shameless plug for a good friend of mine, Steve Lefkovits and his conference, the Apartment Internet Marketing Conference. It’s going to be Apr 29-May 1 in Huntington Beach. If you’re responsible for demand management—certainly marketing, but also pricing and/or sales—you should go to this conference. It’s the finest collection of discussions about marketing and demand generation by industry insiders and, sometimes more importantly, those outside multi-family. Here’s a few things I’m looking forward to:

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