2009

Two years ago at AIM, experts from Sitewire, a full-service digital advertising agency, did a usability analysis of a renter’s search experience from start to finish. They recently caught our eye again.  Sitewire just published a fascinating post on juicing Search Engine Optimization (SEO) results that leverages eBay ad listings.

Pay Per Click (PPC) advertising is a popular and effective way to market your company or services. However, those clicks can add up and result in a costly campaign, often times leaving the marketer wondering how to increase SEO without spending thousands.

Danny Stansfield at Sitewire takes a closer look at how to use eBay to get local Google search listings. He theorizes that by listing your item using keywords that a Google searcher would use as well as an eBay buyer, you can take advantage of eBay’s deep pockets to substantially increase your SEO on Google.

Stansfield is in the process of testing his theory one step further by testing how this strategy could affect local listings in Google.  While perhaps not directly applicable to apartment marketers, the theory of placing keywords in a larger site’s ad listings is worth thinking about carefully.  All of the apartment ILS sites can provide this same function.

Read more about Getting Local Google Search Listings with eBay here.

How changes in renter behavior are affecting apartment marketing strategies

Christina Aragon, the director of strategy and marketing at Rent.com, offers up great marketing advice for multifamily managers in the whitepaper ‘Maximizing Apartment Marketing Return on Investment: How changes in renter behavior are affecting apartment marketing strategies.

Huge drops in employment and home ownership across the United States have dramatically altered the multifamily housing industry. Because of this, trends in renter search behavior are clearly impacting the effectiveness of apartment marketing strategies and tactics. For savvy Internet marketers, this scenario creates opportunities. But it could be a potential pitfall for those who do not adapt to changing conditions.

For apartment marketers to effectively maximize the return on apartment marketing investments, they must understand where and how their prospects are searching for apartments. They also must understand how to capture and analyze the effectiveness of their marketing campaigns and their true costs. Aragon addresses these two areas and helps incorporate fluctuating renter behavior into marketing strategies.

‘Maximizing Apartment Marketing Return on Investment’ provides insights for readers to make the most of their advertising budgets and maximize marketing ROI by looking at these key points:

  1. Where rental prospects are searching for apartments
  2. How rental prospects are searching for apartments, both on search engines and on apartment Internet listing sites
  3. How to implement strategies for developing online marketing campaigns and fine-tuning ROI calculations
  4. Change implications in renter search behavior for apartment Internet marketers

Click here to read the full report.

Written by Lisa Trosien, President of ApartmentExpert.com

The Internet Listing Services (ILS’s) haven’t had it all that good lately. They’ve been getting some pretty close scrutiny on the Multifamily Insiders website, as well as some discussion at national conferences including NMHC Tech and the Multifamily Brainstorming Conference.

Just to make sure we have full disclosure here, I have worked for many of the ILS’s, either as a paid speaker or a paid consultant. Am I currently under contract with any of them? No.

In the interest of fairness, I want to add a few points to the ILS debate. These points are all based upon my opinion after having numerous discussions with the ILS community over the years.

  1. Ratings: All of the ILS’s are very much aware that renters want ratings. However, they (the ILS’s) have received significant pushback from their advertisers (NOT their renter/users) on the whole idea of ratings. The majority of their advertisers have been vocal in saying that they do not want ratings on the ILS sites. Rock, meet hard place for the ILS’s. Years ago, some of the ILS’s used to advertise on Apartment Ratings. Why? The site receives a tremendous amount of renter traffic, exceeding some of the smaller ILS’s on some occasions. Their advertising on this site was dropped however, again due to pressure from advertisers.
  2. It appears, to me at least, that the majority of the ILS’s are continually striving to keep changing, upgrading and improving not only their product, but the end user experience. Apartment Guide was the first ILS to come out with an iPhone application. Apartment Finder launched their Community Sherpa product, in an effort to help property management companies pursue a social media strategy. For Rent just launched the first augmented reality application for the ILS’s, yet another way to improve the renter experience.
  3. Most companies who choose to work with an ILS never try to leverage their relationship. The ILS’s have a wealth of knowledge about your renters at their fingertips such as the top ten search items for your market. Have you asked what these are? If not, why not? Have you asked them how renter behavior changed due to the recession? Rent.com even released a white paper on the topic, loaded with great information on number of searches and more. ILS’s can tell you how many properties the average renter views, how many they contact, what features are most helpful to you in gaining more ‘page views’ and more. (Coupons can increase your leads by 18%; including accurate pricing can increase them by 30%).
  4. One of the biggest criticisms of the ILS approach to the rental market is the fact that all property ads basically look the same. And I agree, that’s clearly an issue for companies that have been able to successfully build a brand. Unfortunately for those forward thinking companies who’ve managed to do this, they are in the minority (on an national basis) and in their case, they might not be the best properties served by an ILS. Taking an extraordinary approach with their extraordinary brand is smart marketing on their part. I will throw in one caution, however. For potential renters coming in from outside the immediate market, the personality that these companies have established might not be immediately discernible to someone who is simply searching for an apartment home with geography, size and price as their qualifiers. In that case, the ILS model would serve them and I believe, serve them well.

Lastly, I must say that I fully appreciate and support the discussion that has been started by folks on the ILS model. Pushing the ILS’s to improve the experience for both renters and property management companies and owners is only going to improve the performance of the product. In NO WAY am I
criticizing those who have been willing to ‘take up the charge’ so to speak. They have actually publicly stated what many were ‘whispering about’ for years and for that and more, I applaud them.

Let’s keep the debate going and help to increase leads and leases for all of us.

Lisa Trosien
President
ApartmentExpert.com

Multifamily operators and property managers are always struggling with lead-to-lease tracking; especially now, when Internet marketing plays such a key role in the promotion of properties. Just what leads are coming from Internet listing services (ILS) providers? What do all these “clicks” mean? How accurate are these numbers from the ILSs?

Mark Juleen, vice president and director of marketing and training of Indiana-based J.C. Hart Co., shook things up when he posted a video questioning the Rent.com‘s lead tracking on industry blog sites including theapartmentnerd.com and multifamilyinsiders.com. (Responses from Peggy Abkemeier, president of Rent.com are included on the blogs.)  A recent article from Multifamily Executive takes a look at this debate and Juleen’s questioning of ILS practices. ILS pricing and reporting methodologies are being put under the microscope as multifamily operators struggle to fully understand the leads ILSs are charging back as part of their normal billing cycle.

Last month, we posted a blog Does Anyone Still Use MySpace?, which summarized an article from the Harvard Business School’s Working Knowledge about a study of the users of social networks: who they are, and what they are doing on these sites.

One fascinating finding in that piece was that people are in fact using MySpace – 65 million to be exact. It just may not be who you think. According to the research noted in the article, it’s because MySpace users populate smaller cities and communities in the south and central US. “MySpace has a PR problem because its users are in places where they don’t have much contact with people who create news that gets read by others,” said Mikolaj Jan Piskorski, the Harvard Business School associate professor featured in the article.

And recently, a related story aired on NPR about the social divide on social media. The piece examines the use of social media among high school students at The Urban School, an elite high school in San Francisco, and art students at Southern Exposure, a San Francisco community gallery. While all students are living in one of the largest metropolitan areas in the US, there still seems to be a divide on social media. This story suggests that social status and race are the reasons for this online social stratification.

The majority of students at The Urban School are part of the group of 90 million Facebook users and held somewhat elitist attitudes about social media, one student saying, “No one uses MySpace. [Facebook] is safer and more high class.” Another student said of MySpace, “The only people who use it are trashy people.”

The students over at Southern Exposure have their own thoughts on who’s using social media networks, one stating, “Not to be racist or anything, but there’s more white kids on Facebook.”

While this is just a microcosm of the real world, research (and a lot of it) is supporting the idea of social stratification on social media. One social media researcher, danah boyd (name spelled in all lower case) thinks the online social world is dividing up – just like the real world – into neighborhoods.

“Young people – and for the most part adults as well – don’t really interact online with strangers,” says boyd. “They talk to people they already know. You have environments in which people are divided by race, divided by class, divided by lifestyle.”

boyd theorizes that business analysts have been dismissing MySpace because they do not belong to the social groups using that site. Because studies show that lower income users are more likely to click on ads, boyd feels MySpace is an excellent place for advertising

What do you think?

Click here to read the full article.

As we try to wrap our minds around how to use social media networks to our advantage, it’s just as important to understand the audience. Just who are these users of Facebook, MySpace and Twitter? How are people using LinkedIn? Is anyone using MySpace anymore?

 

Mikolaj Jan Piskorski

A recent article, “Understanding Users of Social Networks” by Sean Silverthorne in Harvard Business School’s Working Knowledge looks at the surprising findings of Harvard Business School associate professor, Mikolaj Jan Piskorski (shown at left) regarding his study of the users of online social networks. Through these findings companies can develop strategies to leverage various online networks for profit. Silverthorne’s article highlights five major insights regarding online social networks.

 

“No One Uses MySpace.” It turns out that little phrase isn’t true. In fact, there are 70 million MySpace users, not too far off from the 90 million on Facebook. So why isn’t MySpace getting any love? According to Piskorski, it’s because MySpace users populate smaller cities and communities in the south and central US. “MySpace has a PR problem because its users are in places where they don’t have much contact with people who create news that gets read by others.”

 

Then Came Twitter. Piskorski found that 90 percent of all “tweets” were created by 10 percent of users. More women are on Twitter than men but they tweet at about the same rate. Only people who are willing to put themselves out there publicly to others that they may not know use Twitter.

 

Addressing Network Failures. Online networks are successful when they point out the operational shortcomings of offline networks. For example, you might be less apt to keep up with classmates if you relied on reunions, telephone calls and mail, but online you can be up to speed on your friends’ lives very easily.

 

Empirical Evidence. Why are people on social networks? What are they doing? Piskorski has found that 70 percent of users look at pictures or view other’s profiles. He also discovered some major gender differences in site usage. For example, the biggest usage category was men looking at women they don’t know, followed by men looking at women they do know. Women on the other hand look at women they do know.

 

From Social Media to Social Strategy. Piskorski says that executives are treating social network sites like websites, as another channel to get people to click through. Users on social sites do not click through on advertising. These are social sites and to be successful, you need to think socially. The mindset needs to change from social media to social strategy. Firms need to help people fulfill their social needs online, and they can do that by making products more social and leveraging group dynamics.

 

Click here to read the complete article.

 

Is revenue management just a “black box?”  Have the technical challenges been solved in creating a software that can optimize the rent yield in apartment communities?  What’s the math behind revenue management?  A new technical white paper answers these questions and many more.

Dr. Jian Wang

In a recently published white paper, “The Implementation of an Apartment Dynamic Pricing System,” Dr. Jian Wang, vice president of research and development for The Rainmaker Group, describes in great detail the implementation of an apartment dynamic pricing system with particular emphasis on setting optimal rental rates for new leases. The system he describes “has been helping several leading apartment operators offer prospective tenants a menu of rent options for the last six years. It sets the optimal rents everyday, which are presented in the form of unit type, move-in week and lease term.

Click here for entire white paper

Apartment operators struggle with a myriad of issues, one of the most important is setting rental rates for new and renewal leases. Traditionally, rents are typically set with the goal of achieving market share, maintaining occupancy and remaining profitable. Rents are determined by various factors including market condition, competition, condition of property, and vacancy rates. Management experience also plays a role in determining rental rates.

Revenue Management (RM) has emerged as another way to determine lease rates for apartment operators. This methodology uses data-driven pricing to find the optimal price for individual apartments based on current and forecasted market conditions.  Apartment Revenue Management Systems (RMS) is a rapidly growing trend for setting rental rates in the apartment industry. Once limited to the airline and hotel industries, RMS has seen significant growth in the apartment industry since multifamily-specific software hit the market several years ago.

The article includes a study of the characteristics of apartment rental firms compared to hotels from a revenue management perspective. The characteristics that apartments and hotels share:

  • Both are perishable products (they are worthless until they are occupied again)
  • Both have constrained supply (there’s only so much to go around)
  • Both are effected by advance consumption decisions (customers reserve product before using)
  • Both have censored demand observations due to product availability and/or pricing constraints

However, the apartment industry does distinguish itself with the following characteristics:

  • Longer lengths of stay
  • Fewer transactions
  • No repeat customers
  • More renewals
  • Riskier decisions
  • No group booking
  • No walk-ins
  • Concessions

Dr. Wang outlines his expert view on the design of an optimal multifamily revenue management system with modules including:

  • Data Aggregator – links the property management systems and the RMS
  • Statistics Operator – estimates a number of business statistics based on the aggregated historical data
  • Demand Forecaster – predicts the remaining unconstrained demand for a finite planning horizon, which will be fed into the Rent Optimizer module
  • Supply Forecaster – predicts the number of units available for lease for a finite horizon of future weeks
  • Reference Rent Calculator – estimates reference rates
  • Rent Optimizer – calculates optimized rents from which the optimal rental rates are derived in the Rent Recommender module
  • Rent Recommender – module that recommends optimal rents by disaggregating optimized rents

Dr. Wang has more than 16 years of experience in mathematical modeling, system architecture, and implementation in engineering and software vendor industries. He’s a demonstrated leader in operations research and is published in several top journals.

Click here for entire white paper

The multifamily industry spends around $170 per unit yearly on marketing costs – over $50,000 annually for a 300-unit property, or $1.7 million per year for a 10,000-unit portfolio. The bulk of this spending goes to advertising, yet the typical owner/manager still struggles to determine if this money is delivering cost-effective results.

 

Many advertising decisions are made without clear data on how effective different forms of advertising can be. The multifamily industry can change this by using principles of direct marketing to assess which advertising methods will generate the most leads and leases for the least amount of cash outlay.

John Helm, CEO, MyNewPlace.com

John Helm, CEO of MyNewPlace.com stresses the importance of consistently tracking the effectiveness of each advertising source in a white paper Cost Effective Resident Acquisition.  His team worked with the heads of marketing for several owner/managers in implementing the recommended analytical approach.

In every case, the owner/manager was able to identify that 20%-30% of their advertising spend was simply not cost-effective. In many cases, they were able to cut this spend, redeploy half the “saved” dollars and replace, or even increase, the number of leads and leases generated.

 

There are five basic steps owner/managers can take to evaluate most cost-effective lead sources:

1) Identify Sources

2) Determine Common Metric

3) Benchmark Sources

4) Allocate Spend (and Effort)

5) Repeat

 

Using these basic steps can help multifamily housing managers identify ineffective cost areas of their advertising spend. That money can then be reallocated to more efficient advertising methods, resulting in better leads and leases for the same or lower costs.

 

Click here to read the full report.

 


Budget blues priced you out of registering for AIM 2009?

MyNewPlace feels your pain.

In honor of CEO John Helm’s forthcoming white paper “Cost Effective Resident Acquisition,” MyNewPlace is sponsoring a Twitter-style writing contest to select up to five multifamily executives who will win complimentary admission ($595 value) to AIM. (Lodging and travel are not included.)

Essays may be no more than 140 characters (about 28 words) on the topic of “The Importance of Tracking Marketing Results.”

Since it’s just 140 characters, the deadline is Tuesday April 21, 2009. Winners will be selected entirely subjectively, but given the short deadline you have a good chance of winning if you submit. Contest only open to employees and principals of firms that own and manage multifamily housing.

Please submit by email to Steve Lefkovits of AIM – steve@jtimedia.com and Mandy Cann from MyNewPlace – acann@mynewplace.com.  Previously registered attendees are not eligible.

Sneak Preview:
Download the brand new MyNewPlace white paper “Cost Effective Resident Acquisition” (1.6 mb PDF file).

The Apartment Internet Marketing (AIM) Conference starts in only TWO WEEKS: April 29 – May 1, in Denver. If you’re on the fence about attending, we want to make your decision easier, by giving you three reasons to not attend AIM 2009:

#1. Your customers don’t use the Internet and it’s not important to your company.

The AIM Conference lives up to its name by providing attendees with the best available education on online marketing and operations. We will show you how to cut costs and drive revenue with cutting-edge techniques and new technologies.

#2. Your marketing budget is way too big, but you’ve found the solution: ineffective advertising. It’s a great way to get rid of extra cash.

Unfortunately for you, this year’s AIM Conference is tightly focused on showing attendees how to make the most out of their marketing spend. Our expert speakers will show you ways to track and analyze your marketing spend, use social media to find new residents online.

#3. You like boring speakers talking about things you already know.

Too bad for you. At AIM, we only feature dynamic speakers who will teach you the skills you need to fill units and drive revenue in the current down market. Sessions feature Internet leaders from other industries paired with successful case studies from multifamily owners and managers.

Here are a few of this year’s speakers:

Jed Nachman, Vice President of Sales, Yelp, Inc.

Yelp has revolutionized how people find out about local businesses, restaurants, and destinations with social reviews. At Yelp, Jed is responsible for all aspects of the sales function including local, display, client services, and sales operations. In his presentation, Jed will explain how businesses can successfully work with user-generated local content to increase their own visibility and drive leads.

Sharon Melnick, Psychologist & Fortune 500 Executive Coach

Sharon Melnick, Ph.D. is a psychologist/coach who helps talented and successful people “get out of their own way”. Informed by 10 years of research at Harvard Medical School and trained in cutting edge stress resilience techniques, she is a leading authority in helping business professionals move to the next level and master the stresses of the new economic climate. She is a sought after speaker, and has appeared as an expert for Success Television, Huffington Post, Lime Radio, AirAmerica, Natural Health Magazine, USAToday.com, and others.

Jed Katz, Managing Director, DFJ Gotham Ventures

One of the pioneers of Internet commerce, Jed was the COO and Founder of Rent Net (www.rent.net), the Internet’s first rental and relocation guide. Jed used its infrastructure as the starting point for the formation of Move.com, which he grew to 360 employees and was acquired by Homestore for over $900 million. Jed was recently voted by a community of thousands of entrepreneurs nationwide as a top 10 venture capitalist by the website The Funded and was selected in the “Silicon Alley 100”, an annual list of the most influential people in New York digital business.

Chris Sherman, Executive Editor, SearchEngineLand.com

Chris is an expert on all things related to internet search, and his site SearchEngineLand.com is a leading destination for search information. With over 25 years experience in interactive technologies, he is frequently quoted in the Wall Street Journal, the New York Times, Business Week, USA Today and other publications, and has appeared on CNN, NPR, CBS and other television and radio networks. He will focus on the burgeoning area of local search, and give attendees insight and local search techniques successfully used by other industries.

CHECK OUT ALL THE OTHER GREAT SPEAKERS

SEE THE FULL AGENDA