Creating a Dynamic Marketing Program in a Down Economy

With real estate experiencing an industry-wide downturn, residential and commercial property managers must maximize their marketing dollars. Advertising budgets and occupancy rates are simultaneously shrinking, leaving managers scrambling for ways to attract renters on the cheap.

“Costs for apartment communities continue to rise even as rent and occupancy rates decline—property managers need to cut costs,” says Robert Turnbull, president and co-founder of the recently launched RentWiki.com. Marketed as the first online rental site to integrate social media and networking features, the Web site offers property management companies non-contractual, pay-per-lead options when looking for potential renters to fill their units.

Pay-per-lead and social media
In the fourth quarter of 2008 alone, apartment units saw a nearly one percent drop in occupancy nationwide, according to California-based data research firm, Realfacts. Nationally, the decline translated into 10,000 new vacant units, prompting property owners and managers to find a quick, affordable fix for marketing their buildings.

On RentWiki.com, property managers list their vacancies through the operators of the site at no upfront cost. Managers are charged $10 for every lead sent to them; they can suspend their listings at any time and are only charged for leads they receive.

Turnbull, a Web advertising veteran in the rental market, says the model has been an ideal solution for property managers who have had to slash their marketing departments. And with 90 percent of apartment seekers starting their searches online, he says RentWiki.com speaks to the future trends of apartment marketing.

“The Internet is changing and the way we market is changing,” says Turnbull, who adds that social media is becoming increasingly integral to successful marketing strategies. By partnering with social media site Twitter, RentWiki.com allows visitors to select a city and review the pros and cons of the neighborhood in a live format.

Michael McFadden, co-founder of TheSociety.com, a marketing advocate that works on behalf of more than 100 luxury vacation rental property managers, representing over 5,000 properties, and, has also engaged in social media marketing strategies. He says the medium has become one of the most effective and affordable tools available for filling vacancies even in the vacation market, which has been down by as much as 50 percent in the last year.

“We’ve seen a large increase in property owners on Twitter,” McFadden says. “That being said, it’s an awareness tool, not a sales tool—you have to be careful. You need to engage your customers and bring them value-added information, not just blast them with self-promotion.”

Cost/lead analysis
By using a spreadsheet to track how many legitimate renter leads they are getting from each marketing source, property managers can divide the amount of money they are paying each source per month by the final count of renter leads. Be sure to eliminate wrong numbers, missed calls and vendor calls, Turnbull says. “If you’re paying $50 or more, drop the source,” he says. Thirty to $50 per leads is still pretty expensive, while $10 to $30 per lead could yield a solid return on an investment. “If you’re paying $10 or less, you’ve struck gold,” he says.

Ask for concessions
Just as the rental market has become more competitive with the growing number of vacancies, so has the rental marketing market, Turnbull says. “Don’t be afraid to ask for concessions—remember their outlet is useless without your content,” he says. Be wary of a marketing source that seems more interested in taking money than maximizing the investment with them.

Maximize every lead
Now, more than ever, property managers must review their employees’ phone skills to ensure leads are being closed at the highest ratio possible. “Leads that are responded to within the first two hours have a 50 percent greater chance of being closed,” says Turnbull, who also suggests investing in a phone review system or outside call center to effectively process leads.

Turnbull adds that no matter what choices property managers make in the coming year, 2009 marks the beginning of a paradigm shift in marketing tactics. “The power is no longer in the hands of the marketer, it’s in the hands of the consumer,” he says.