In the latest of our Expert Roundtable Series, we report on best practices for managing leads. We interviewed three experts in the multifamily housing market to learn about the technologies and procedures they use for successful lead management. Among our experts are executives from Gables Residential and Archstone – both are ranked in the Top 50 Apartment Managers report from the National Multifamily Housing Council. Let's meet our experts:
Donald Davidoff is Group Vice President, Strategic Systems for Archstone, a large privately held multi-family housing developer and operator. His teams manage Archstone's entire marketing platform, which includes ecommerce, field marketing, creative services and corporate communication. He also pioneered Archstone’s industry-leading business process management solution to automate key forms and processes resulting in a "less paper-full" office.
Lynette Hegeman is Vice President of Marketing for Gables Residential. In this role, Hegeman oversees the development and execution of general marketing, internet marketing, public relations and advertising. With 19 years of experience in marketing, sales management and real estate development with companies such as Intrawest, Hilton Hotels Corporation and Preferred Hotels and Resorts Worldwide, she leverages her experience to further establish Gables as a leader in the multi-family industry. Lynette has a passion for excellence and a strong focus on best in class marketing campaigns.
Tracy Guillen is the owner of Esquire Property Management. She has many years of experience providing Ventura County property management services to real estate investors in Ventura County. Tracy is passionate about the real estate business and takes a personal interest in this field as she actively owns, sells, buys, and manages her own property management portfolio in Ventura, Oxnard, & Camarillo. Her affiliations include: California Broker’s License, California State Bar Association and the California Apartment Association.
Lead management is a critical component for any property management company serious about marketing. In a study from the Aberdeen Group, 90% of companies using automated lead management had average yearly revenue growth of 59%. So without a strategic and organized process for vetting prospective tenants, you may be leaving money at the curb.
What Technology Do You Use to Manage Leads?
Technology is central to any lead management process and infrastructure. Whether it’s a simple contact management system or a custom lead management system, you cannot scale your lead management efforts without technology.
Experts from our roundtable use three general types of applications to track leads. From least to most sophisticated, they are: contact management systems, property management software with customer relationship management (CRM) functionality, and customized lead management software.
In general, small property management companies use less sophisticated technology than their large counterparts. First, small companies don't need the functionality, automation and scale included in best-of-breed lead management software. Secondly, they don't have the budget or resources to warrant buying a dedicated lead management system. Instead, most will do happily with a simple contact management program.
Tracy Guillen – “Currently, we just use our website’s contact form to track leads. We use a system called Formstack. It allows us to create a custom, online contact form in HTML, then track inquiries by email and in an online database.”
On the opposite end of the spectrum are large commercial and residential firms that manage thousands of units and field thousands of property inquiries. They often need property management systems with CRM functionality, or stand alone lead management systems. Both Gables Residential and Archstone have developed proprietary lead management software to track prospects.
Donald Davidoff – “We have a comprehensive set of tools to manage leads. We built our own Lead Management System (LMS) as a standard interface from lead sources into our property management system (PMS). Leads from Internet listing services (ILSs) come directly into our LMS which notifies our community associates when they have a new lead and tracks their response. For inbound phone calls, we use Level One which sends leads into this same LMS and provides independent reporting as well.”
Lynette Hegeman – “Gables Residential utilizes a custom built, proprietary system called Insite to manage all referral sources, prospects and conversion results to lease. In addition we have launched a custom analytics tool that tracks lead data, cost and conversion attribution.”
How Do You Prioritize Leads?
According to a Raintoday.com report, fewer than 25% of new leads are sales-ready. The report is not specific to the property management industry, but this industry isn’t very different to others in that regard: not all prospective tenants are ready to sign a lease. So what do you do with the “leftovers?”
To begin, you should create a formal lead scoring process. Identifying qualified leads can have a big impact on the productivity and effectiveness of your sales teams. Without prioritization, your sales rep could hound a prospect who is six months away from moving while another “ready-to-move” goes untouched.
An effective lead scoring system will rate a lead based on a number of criteria. Take Gables Residential for example. They consider a prospect’s apartment preferences, budget, location and time-to-move before prioritizing.
Lynette Hegeman – “All leads go through our “funnel” and are prioritized by the level of information received. For instance, two-way communication indicating apartment preference, budget and preferred location would be deemed a priority lead if the community being looked at meets the prospects requirements. Another priority factor would be timing of move. Those with short time frames would be considered a priority. However, in general, we treat all leads with equal care and attention and follow-up on all.”
In some cases, a simpler strategy may be just as effective. Both Esquire Property Management and Archstone take a hot-or-not approach to prioritizing leads.
Tracy Guillen – “We have a simple rating system. They are either hot, or warm and need more nurturing. If the lead is cold, we typically let them go without any further follow up.”
Donald Davidoff – “There’s really not a formal scoring process. We follow up on every lead we get. We identify very quickly if the lead is unqualified (price/quality too high or too low, location doesn’t work, etc.), so those leads fall off very quickly. In fact, many of those are filtered out through Level One, so we don’t even waste time with those. Once we have a qualified lead, we try to time the follow up with their desired move-in so that we don’t push them too quickly – or too slowly – for what they want.”
What is Your Lead Nurturing Process?
After you prioritize leads, what do you do next? This is where a lot of companies drop the ball. Without a good follow-up or lead nurturing process in place, many companies miss out on revenue opportunities. As a general rule, you need to deliver the right message via the right communication channel at the right time. Gables Residential and Archstone use a a multi-touch process for following up with following up with opportunities.
Lynette Hegeman – “The sales team nurtures each lead by following up within a 2 hour window either via phone, or email. A guest card for each prospect details all conversations and recaps prospects’ needs, wants and price range. Coupled with the tactical approach of three touches, the sales associates work to engage each prospect and guide them through the buying process – ensuring that all objections are overcome.”
Donald Davidoff – “We use a variety of tools including phone follow up, visits and tours and email. We try to understand how each prospect prefers to be communicated with and therefore follow up in the ways and means each prefers.”
How Do You Track Effectiveness of Marketing Campaigns?
At the end of the day, the best lead management still relies on good marketing to bring in prospects. To know that your marketing is working effectively, you need to be able to track its return on investment (ROI).
First, you need to define your marketing metrics. Is cost per lead or cost per lease more important? Or a combination? Archstone uses several:
Donald Davidoff – “We have real-time reports in our PMS, and we do monthly and quarterly reviews using data from our ILSs and Level One to continuously evaluate critical metrics like lead volume, cost per lead and cost per lease.”
It’s also important to track the origin of leads. Did it start with a Google search? A phone call? An advertisement? Companies that track the origin of leads will better understand the value of their marketing campaigns. Fortunately, there are several ways to get this level of detailed information using the right technology.
Lynette Hegeman – “Gables has been using a custom-built analytics tool that tracks each lead by lead source(s), cost and results. Essentially, using a myriad of tracking tools such as Google Analytics, Web Trends and Hit Wise, we created a tool that ties together and scrubs all referral source data.
As a result we follow each piece of traffic through the sales life cycle and gauge the referring source, how many sources did they view in the process (as best we can), how much budget did it take to drive that piece of traffic to the source, and the quality of the lead. We are also geo-targeting to see where traffic comes from in relationship to the proximity of the community.
Another important tactic is our lease matching process that we continue to refine and filter through the analytics program. By understanding who leases and the steps they took in their search process, we can create communication strategies to improve our resident retention programs. The end goal is closing the loop from generating traffic to closing a lease to increased resident retention with lease renewals.”
What's your lead management process? Do you use technology to automate lead management activities? Do you have formal lead scoring and nurturing procedures? Tell us about your best practices in our comments section.
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