Apartment Living BlogApartment Living › Perks Renters and Landlords Can LIVE with

We’ve posted an article previously with ‘Ten Tips for Advertising during Tough Economic Times’. And today I stumbled upon an article from the Wall Street Journal circling the same suggestion we provided; which is for companies to ‘provide perks’ for their customers. This is something we’d like to elaborate more on as it’s very current for today’s market. As I’m sure many property managers know the nationwide vacancy rates are increasing. In fact, according to research collected from Reis, apartment vacancy rates rose to their highest in more than 3 years-greater than 6%-in the third quarter of 2008. While most companies are looking to abandon ship on items such as advertising, the successful companies know better. So what else can property managers do in order to ensure lower vacancy rates at their communities? Again, we go back to the ‘provide perks’ tip.

Renters are smart. There is a plethora of information on the internet about how renters have control now. And everyone knows that turnover in the multi-family housing industry is costly. So keeping renters that are stable and dependable is highly desirable.

So what perks would your company be able to provide? The most popular choice for renters is going to be rent discounts! “There isn’t the job growth necessary to sustain a high demand for rentals and they [property managers and owners alike] have to be much more realistic” about price, said Daniel Baum, chief operating officer of the Real Estate Group. Offer rent discounts for residents that opt to stay in a longer lease.  And beware of the ‘shopper’ renter. These renters will do their research and seek out similar apartments in your neighborhood for less money. Be prepared to show how your community stacks up, or match the competitors pricing.

Another perk to offer would be services for next to nothing or free! (Everyone loves the word FREE) Does your community charge for additional amenities, such as spa usage, renting the club house or the use of a garage? Or how about upgrading on renters appliances? You could even sell the fact you’re installing energy star appliances to save them more money on monthly utilities!

And finally while property managers/owners have to pay bills too, we all need to be a little more flexible. In this state of the economy people are taking pay cuts or worse, loosing their jobs. So if a resident contacts you regarding the rent being a few days late, or a possible payment plan, weigh your options. If this renter has a steady track record, then be willing to discuss alternatives.

Times are tough, but everyone-property managers/owners and renters alike-have to survive. So finding a balance between what each side can financially do is going to be the way to weather this current economic storm.

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  1. While fantasizing about The Next Big Thing in Multifamily Marketing can be inspiring, execution beats everything. Today I see way to many apartment communities searching for the next marketing solution, I ask “ARE YOU FOCUSED ON RESIDENT RETENTION?” Which is exactly why an easy-to-apply trend like the rising importance of perks and benefits should be on your radar.

    Marketing and Leasing problems can be symptoms of the lack of a solid resident retention plan, not the solutions.

    Consumer infatuation with perks and privileges isn’t new. For years, airlines, hotels, credit card companies and private banks have been cleverly rewarding their most valuable customers with surprises, status symbols and convenience. Our industry has made attempts at providing our residents with perks and a handful have done it very well. Read “Beyond Resident Referrals.”

    Today we are rapidly moving towards a consumer society that’s based more on experiences, on status stories, on the ephemeral—and in which, for many, time is now the only true scarcity—expect perks and privileges to become an integral part of every business to consumer industry and sector. YES! That includes ours.

    This trend has been dubbed PERKONOMICS by Trend Watch: Their statement reads “A new breed of perks and privileges, added to brands’ regular offerings, is satisfying consumers’ ever-growing desire for novel forms of status and/or convenience, across all industries. The benefits for brands are equally promising: from escaping commoditization, to showing empathy in turbulent times. One to have firmly on your radar.”

    Time—that is, the lack of it—is still one of the biggest consumer trends around. Anything that you can do to help save consumers’ precious time is worth its weight in, well, long lazy uninterrupted days. And that includes not wasting people’s time, too. 😉

    70% of Americans 16 years and older say they don’t have enough time to do all the things they need to do. Half of US consumers now say that a lack of time is a bigger problem in their lives than a lack of money. (Source: Yankelovich.)

    43% of Americans, 39% of British, 60% of Dutch and 47% of Australians rate themselves as ‘time poor’, meaning they feel short of time. (Source: J. Walker Thompson.)

    Americans are critically under-vacationed. That’s both by choice and circumstance, at least according to the results of Expedia’s annual Vacation Deprivation Survey. Americans had only 14 days off in 2007. Yet 35% of Americans won’t take all the time off they earn, returning upward of 438 million days to their employers. (Source: Expedia.)

    Who to learn from? Perks pioneers obviously include airlines, hotels, credit card companies and private banks, who have always been big on all kinds of loyalty programs and privileges. From priority lines to “no middle seat” guarantees, and from upgrades to discounts on flights, holidays and concerts.

    So for those who want to dive deeper into perks, study the various perk-based initiatives and countless articles and books that cover the dos and don’ts of traditional loyalty programs and rewards. Then either translate those established insights into new perks for anything that is not an airline, hotel or bank, or come up with a novel approach for the incumbents. Easy, right? Southwest Airlines created a perk from something they had always done when they didn’t follow other airlines in charging for baggage. Not paying for my luggage feels like a perk now.

    So … If you deliver two major benefits that your customers clearly crave—status and convenience—what’s in it for you, as a multifamily professional or as a brand?

    Perks help commodity-like industries stand out by conferring a (renewed) sense of uniqueness. Adding perks often requires the ability to partner with other products or services, so brands with the best partnering skills—and therefore access to the best exclusive offers—will win. Jamie Gorski and Karen Kossow with KSI are masters at partnering skills and giving residents perks from the day they move-in. Partnering with the likes of Starbucks, Crate & Barrel and restaurants with famous chefs are only a few of the resources that they have used to create perks for their residents. Lennar Homes has a perks program for the people who buy their homes, and that’s a one-time sale. Hmmmm … or is it?!? Visa has one that they have named “VISAPerks.”

    Perks can give you the leading edge when it comes to attracting first-time residents. They can make for great if not invaluable PR. Residents will tell others—Perks are excellent conversation starters—while the media loves a good perk story. A famous chef gives cooking lessons or and local author releases a new book and your residents get the perk of attending right in their own community plus they get to bring a friend or two!

    Perks can help make boring communities/companies interesting again and thus more desirable.

    Perks can help cultivate more desirable brand perceptions and associations—think anything from showing you actually care about your residents (gasp!) to showing you care about the environment, offering eco-perks. An example of an eco-perk would be special parking for residents with hybrid cars.

    First of all, for most communities, perks will be an important sub-trend, not an A-list resident trend that will change the nature of resident retention overnight. It also won’t smooth out major issues that your brand may be having; if anything, it will enable stable community brands to do even better. (Read blog post A Brand Called You) Yet it isn’t a gimmicky trend, either: any new source of inspiration for improving resident satisfaction should be embraced with vigor.

    The ‘new’ perk isn’t about old-school resident renewal and referral programs, as those do tend to deliver financial value to residents, but not necessarily the status boost or true convenience tied to perks. This trend applies to all grades of multifamily assets!

    Another non-perk: turning previously free, completely accessible services into pseudo-perks, if not paid perks. This is a dubious practice: witness perk-pioneers like airlines now introducing all kinds of payment and perk schemes for simply checking in luggage. Think about the drive in recent years to increase ancillary income, our industry is no different than the airlines in that regard.

    Last but not least, perks are cool to receive, but not cool to have taken away: prepare to be in it for the long run, or clearly communicate the temporary nature of the privileges you’re introducing.

    All in all, the best way to approach the perks trend is to dream up genuinely interesting and unexpected benefits and privileges that will delight some or all of your residents. Simple things like returning a residents security deposit when they renew their lease for the third time. Apartment makeovers when they renew their lease for the second time, surprise them with a perk of night in a PARTNER hotel so they don’t have breath the new paint fumes. Add a perk to their apartment when they refer a new resident to the community. The list of easy to implement perks is endless!

    The Opportunities?

    Besides all of the benefits summed, there’s a chance here to be the first non-airline/hotel/credit card company to really nail this trend: very few brands seem to have an integrated view, let alone an integrated approach to perks. And for those of you with solid perks in place it may be time to give your programs a makeover.

    Bottom line: you will have to be creative, and you will need to reach out, if you want to offer your residents perks outside your own sphere, it means that forging exclusive relationships and partnerships with other brands and personalities has never been a more prized skill. So … be the first one to do any of the above well, and reap the benefits.

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