Resident Retention – Taking Your Residents’ Temperature

You have heard this repeated in sales training time after time – but it’s true!

‘It’s easier and less expensive to keep the customers you have than to acquire new ones.’

In fact it costs 5 times as much to acquire a new customer! This principle also applies to resident satisfaction and techniques to keep your current residents at your apartment community. Simply considering make-ready and vacancy costs of approximately $4000 on average for every unit you have to turn over, it’s easy to see why it is important to ensure your current resident stays in the home instead of having to look for a new one to fill the space.

In the current economic landscape, many owners and management companies are increasing their focus on resident retention, and what it takes to boost their residents’ loyalty to improve the likelihood that they will remain a resident once their lease term is up. A simple increase of 1% in your resident retention rates can mean thousands of dollars over time just at the property level. Essential to ensuring your residents remain at your apartment community is to determine their level of ‘resident satisfaction,’ and what is impacting their opinion and ultimately their leasing decision when it comes time to renew.

Try one or more of these methods to reach out to your residents and see how things are going!

• Engage with your residents whenever they visit the office or you see them on property
• Check out what residents are saying about you through social media outlets like Facebook or an apartment rating or other websites
• Survey your residents at essential touch-points during their lease, such as after they move in, after you complete a service request, and when their lease renewal is approaching

You can gain some valuable feedback when you ask and listen. The level of satisfaction with their home is dependent on whether it is meeting their needs – creating value in their perspective. Every service and amenity you provide takes on a unique level of importance to each resident – the only way you can find out what’s important to them is to understand and get feedback. This should be your first objective in understanding how to deploy your resident retention strategies. Resident insights might surprise you!

“The only way you can find out what’s important to them is to understand and get feedback.”

However, acting on specific feedback takes time to implement. While drilling down to what exactly is having the greatest impact on the leasing decisions of the residents at your community is the most effective path to increasing resident retention.

Resident appreciation ideas that can put a smile on your resident’s face.

• Place a “Welcome” card in each new resident’s home on move-in day
• Leave a “Just Popped In” note and popcorn treat bag in their home after service is completed
• Offer perks – negotiate local retailer discounts, offer reserved parking for long term residents, etc.
• Stay connected with fun and informative monthly newsletters
• Give personal recognition, like a quick note or small gift on a resident’s birthday
• Create community events – parties, organized outings, or even a community ‘yard sale’

While residents move away for a number of reasons, some of them beyond your control, you can tremendously impact your resident retention with how you treat your residents. As much as 2/3 of resident turnover is within our power to affect. Communicating effectively, responding timely, properly maintaining their apartment and the community they want to proudly call “home’… all of these help create an attractive lifestyle environment for your residents as a whole.

So if you’re not already, start taking your residents’ “temperature”! Learn what they value most – what is working and what might not be – and strive to provide the lifestyle they will stay for and recommend you to others because of.  ASK, LISTEN and ACT!

Resident surveys offer a path to learning more about what your residents needs are and should be at the top of your to do list..    Please see our guide to improving resident retention for supplementary details.

Resident Retention: The Good/Bad and the Social Media Factor!

Lee Resource Inc. found that for every customer complaint, there are 26 other customers who have remained silent. But silence is not golden! When you consider that customers who are not talking to you are most likely talking about you across multiple communities on the Internet and it’s apparent how important proactively pursuing customer thought and opinion are to your business.

“Lee Resource Inc. found that for every customer complaint, there are 26 other customers who have remained silent.”

Your customer’s experience is the sum total of every interaction they have with you, whether in person, by phone, or over the Internet. As there has been a push in recent years to examine customer buying behavior, a strong correlation was found between customer purchasing decisions and how delighted they were with their provider. 86% of consumers quit doing business with a company because of a bad customer experience (Harris Interactive).

For the multifamily industry, resident retention is a vital aspect of profitability. Make ready costs are extensive when units turn over, so to keep a resident in their home offers extensive savings. According to Peppers and Rogers, 81% of companies with strong capabilities and competencies for delivering customer experience excellence are outperforming their competition.

But how do we manage the processes of resident retention?

It starts with communicating with the customer – and we’re not talking about a generic newsletter or that 90-day notice of an impending rent increase. Sure, one way communication is necessary, but it’s real dialogue – receiving valuable feedback from the customer – that leads to productive paths for increasing the likelihood that resident will stay at your community for a very long time.

Nobody likes moving – albeit sometimes a move is necessary and the reason is beyond our control. That means it’s a practical impossibility to expect a resident retention rate of 100%. You can’t grow resident retention rates overnight or exponentially in a matter of a typical lease cycle. But you can find areas of opportunity at the property level that marginally over time will improve profitability.

“42% of companies who embark on a mission of creating a great customer experience do so in order to increase customer retention.”

Every customer-facing employee makes a difference in how your customer perceives their experience at your community. Do you ask new residents about their move-in experience after they have had a little time to get settled? If they experience a maintenance problem, do you follow up by inquiring as to their opinion of the interaction? 42% of companies who embark on a mission of creating a great customer experience do so in order to increase customer retention.

You have to start somewhere by finding out how your customer feels about you – are you meeting their needs, providing a high value, and offering excellent service? Would they recommend your community to someone they know? Once you gather specific data about encounters with your staff and service team, identify which experiences have the highest correlation to their buying decision – whether they plan to renew their lease or not! – then you can define the areas to be addressed that will make the biggest impact to your bottom line.

Social media is now a way of life; it can work for or against you and like it or not, the bottom line is your profitability capacity will be measured by your ability to effectively extract and manage feedback from your customers.

With the Ellis Partners Resident Feedback Survey program, we help property management companies seek out and listen to the Voice of the Customer; analyze strongest points of correlation to lease renewal; and outline plans of action to increase retention, because greater lease renewal rate leads to higher total customer lifetime value and profits.