MHN Interview: Madison Apartment Group’s Strategy to Appeal to Gen Y Renters
Philadelphia—Madison Apartment Group LP, the multifamily area of BPG Properties Ltd., recently rebranded their website to appeal to Gen Y renters. MHN recently spoke with Dean Holmes, COO of the Madison Apartment Group, about the importance of appealing to Gen Y and how their new website is helping them achieve that goal.
MHN: Tell me about your rebranded website. How does it appeal to Gen Y renters?
Holmes: I’m the COO of the company, and I joined just under a year ago. We had a number of key initiatives that kept us busy over the year, but first and foremost in there is really spending a lot of time on our web presence and services we’re offering to our residents. For us, that meant that we rolled out a completely new website, a brand-new look, much more focused on the identity that we’re trying to get across to our customer. We really ramped up the search functionality of the site, made the application process easier. We’re really working hard to make it easier for our customers to do business with us, when and where they want to do it, and for us that means not having our customers be constrained to our traditional office hours but really being able to offer the whole flight of services that we conduct electronically.
We’re at the point now where—at least at the last tally—roughly 65 percent of our residents across our 20,000-unit portfolio are under the age of 35, and a growing percentage of residents are under the age of 30. What we’re finding with that demographic is they don’t want to be constrained by our traditional office hours. They want to be able to deal with us electronically, and they want to have a little bit of flexibility in their leasing arrangement with us.
One of the things that we were spending a lot of time looking at was the fact that we’re dealing with an increasing number of “renters by choice,” and folks that want to deal with us on their terms and have some flexibility on their lease arrangements, and who don’t want to compromise on what their expectations are, either for service levels or amenities, just because they’re making the decision to rent vs. buy. As part of pushing this identity out on the new website, we created this services center around the “Madison Lifestyle.” Not all of these things are groundbreaking things—they’re things that a lot of our competitors do, but maybe have not done a great job in making it known to their customer base. For us this lifestyle is really a slate of services and guarantees.
When you lease with us, given the fact that we use a revenue management system, you can literally pick your lease term—it can be any length, any move-in date. The days of the standard lease that begins at the beginning of the month and ends at the end of the month are gone. It starts with a satisfaction guarantee. If you move into one of our communities unsatisfied within your first 30 days, we’ll allow you to move, no questions asked, so we’re giving people that flexibility. If they have reason to second guess their decision—and we don’t think they will—we’ll respect that and release them [from the lease].
We’ve got some guarantees centered around the kind of service that we’re providing to the residents. We’re making promises about the speed in which we’ll respond to inquiries, and if we don’t, we’ll put our money where our mouth is—we’ll credit them for a day’s rent for every day we fail to complete the maintenance that they’ve requested. We’ve played with some very flexible policies in all of our communities. We’ve put in a nation-wide transfer policy. We’ve got a 20,000 unit portfolio, essentially from Seattle to Miami, and we recognize that a lot of our customers now want mobility, so if any point in your lease you want to transfer to one of our communities, we allow you to do that, again in a hassle-free, no questions asked way. We think this gives us a little bit of differentiation, but it also caters to that increasingly younger demographic that we’re seeing in our communities.
MHN: Your guarantees must get a good reception from people, even if they never use them.
Holmes: Truthfully, a lot of it is psychology. A good number of these will probably never be taken advantage of by the average resident, but it does give them peace of mind, and we think it pushes our prospects over the edge if they’re considering one of our properties versus a competitor.
MHN: Do you find that the older renters are reacting to the website as well as the younger renters? I know you’re aiming for Gen Y, but what about the boomers or Gen X?
Holmes: That’s a great point, because I talked about the 65 percent number, which means 35 percent of our residents are in the older demographic. We’re seeing excellent participation in our online programs by the age brackets that make up our customer base, but we do still have a large contingent that want to deal with us on a personal basis and want to deal with us face-to-face. We’ve tried to make our website pretty user friendly—you can now interact with us face-to-face, by chat, by email, by phone. We’re paying very close attention to the desires of the younger demographic, but we still are very mindful of the fact that we’ve still got 35 percent of our customer base who may want to be dealt with differently.
We’ve been very proactive with customer relationship management and apartment ratings loop. Very few of our residents now make a decision without looking at a rating site, so we’re taking a very proactive approach about that, as well as trying to learn from our customer as opposed to us assuming what they want.
MHN: Why was now the best time to change your website? Has the industry as a whole moved toward targeting Gen Y?
Holmes: I think so. If you haven’t, then you’re probably late to the game. This continued reduction in the average age of our residents isn’t going to change—in fact, it’s going to continue to get younger. We’ve been tracking it every month and it’s continued to get younger incrementally, and so we felt that now was the right time to do it. The reality is that in order to stay relevant and stay current about what’s happening in our industry and what our customers are expecting, we have to devote time and attention to our identity and our website, really on an annual basis. It’s not just a static process that you implement and then leave alone for years. The business is just moving way too quickly for that.Tags: executive interviews, property management, Technology