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#MAMConf14
Integrating Marketing, Revenue Management and Customer Analytics
Bryan Pierce, Director of Revenue Management, Holland Partner Group
Devin Merrill, Vice President, Analytic Applications, Property Solutions
Josh McDonald, Director of Marketing, Holland Partner Group
Moderator: Elaine Williams, Owner, E Williams Consulting
#MAMConf14
• Business Intelligence shows great promise"The emerging field of business intelligence shows great promise within multifamily for helping operators find ways to market and sell more effectively in a variety of ways.
• Combine Marketing and Revenue Management to generate and measure more demand
Unifying marketing and revenue management practices gives owners the potential to understand the nuances of demand, as well as how to generate more demand that can be converted at a higher price.
• Leverage tools to understand and improve the buying processCustomer knowledge and segmentation-including social media tools-can provide simple, clear areas where operators can better understand today's buying process and how to create a great buying experience that makes it easier to rent at communities using better data."
Session Synopsis
#MAMConf14Example Scenario – The Situation
Uncovered Exposure
Forecast: 10 units of uncovered exposure over the next 90 days
#MAMConf14
• What do you do?– Costly Alternatives
1. Lower price2. Increase marketing spend3. Lower screening threshold
– Free Alternatives4. Improve lead conversion rate5. Improve property reputation6. Improve renewal rate
Example Scenario – The Options
#MAMConf14
• Align your marketing processes with real data to allow your RM system to reach stronger performance• Why “buy” (literally) more traffic? Effectively manage
what you already have to start with.• Align lead management touch points to when your traffic
actual makes the “buy” decision.• Ratings & Reviews impact your traffic, leasing volume
and rent growth• What sources give the most benefit – over the long term
(18-24 mo). Think retention and increases.
Data-driven Marketing
#MAMConf14
Lower Price and “buy” demand
• Demand can by “bought” by lowering the rent from $800 to $725• Over the next 12 months, that will decrease potential revenue by $1,500
Cost: $1,500
#MAMConf14
• Align lead management touch points to when your traffic actual makes the “buy” decision.
Effective Lead Management
3 3.2 3.4 3.6 3.8 4 4.2 4.47.5
8.0
8.5
9.0
9.5
10.0
10.5
11.0
f(x) = − 1.94095306798929 x + 16.1911357041811R² = 0.35392741769708
Lead Follow-Ups vs. ATR %
#MAMConf14
Why “buy” (literally) more traffic? Effectively manage what you already have to start with.
Marketing Optimization
Average follow-ups per lead• Our competitors (industry average)
follow-up with only 59% of their leads
• Holland lead follow-up is almost 4 times per lead (376%)
Average time to follow-up• 82.4% of all leases signed within 2
days of the initial tour• 94.2% of all leases signed within 9
days of the initial tour
# of Follow-Ups Per Lead Average Avg. ATR %
4.0 – 6.5 4.5 7.1%
3.5 – 3.9 3.7 7.3%
3.0 – 3.4 3.3 7.5%
2.8 – 2.9 2.9 8.3%
Holland 3.8 7.3%
2013 Average Monthly Results
#MAMConf14Increase Marketing Spend
• Marketing spend can be increased to cover the 10 units of forecast exposure
• If the minimum cost per lease is $99, this alternative will cost $1,490 to cover the exposure
Cost: $3,500Improve Lead Conversion Rate
• Assume there are 133 leads expected in the next 90 days and the current conversion rate is 8% this will create 10 leases
• An increase in conversion rate of 7% will cover the 10 exposed units
#MAMConf14
• What sources give the most benefit – over the long term (18-24 mo). Think retention and increases.
Long-term value by Lead Source
#MAMConf14
Lower Screening Threshold
• Lowering the screen score threshold will increase the demand pool, but not without potential costs and risk• Potential costs may be incurred due to the risk of higher delinquency, skips, and evictions• In this example, 10 leases can be gained by moving the acceptable threshold from 60 to 40• This will lead to an expected increase in the skip rate of 3% or 6 units• If the average turn cost is $600 per unit, the additional cost is $3,600
Cost: $3,600
#MAMConf14
• Ratings & Reviews impact your traffic, leasing volume and rent growth• Social Media tools and SEO can tell us buying tendencies about the
website visitors• Use this information to better target your renewal incentive
Reputation Impact
#MAMConf14
• Asset class impacts (key takeaway)
Reputation Impact
0 0.1 0.2 0.3 0.4 0.5 0.6 0.7 0.8 0.9 10
0.05
0.1
0.15
0.2
0.25
0.3
0.35
"Class B" Assets are more impacted by Ratings Scores than "Class A"; 4x more "B" data points than "A"Click Through Ratio versus Score by Asset Class: Apr-Sep '13
Class B - Correlated: .48; Class A - Not Correlated .13
Class B: Apartment Ratings Score
Clas
s B: C
lick
Thro
ugh
Ratio
#MAMConf14
Q & AContact Info Bryan Pierce [email protected] Merrill [email protected] McDonald [email protected] Williams [email protected]
Thank you!!