How Bad Data Is Hindering Your Leasing Efforts
- Oct 25, 2018
It’s almost 2019, and we are awash in data. It seems that every movement and decision we make is tracked by some sort of gadget, generating an endless stream of statistical information. Meanwhile, companies of all shapes and sizes have turned to high-powered business intelligence software to collect data and determine how they can best use it to optimize their products and operations.
The apartment industry certainly hasn’t been impervious to the data revolution. Many owners and operators have taken the emotion out of pricing by implementing revenue management software that gathers and interprets a wide range of information to set rental rates. Management companies also use sophisticated solutions to monitor the effectiveness of their marketing spends.
But the apartment industry could do so much more. Each time a prospective resident shows interest in an apartment community, data is generated. Currently, this data is poorly captured, and the community and apartment owners lose valuable information. Poor data collection during the leasing process greatly reduces the effectiveness of the software meant to improve efficiencies. Put simply, when leasing agents don’t gather accurate and complete information, it negatively impacts leasing agent performance, pricing and other operational efforts.
The Causes of the Problem
There are two primary reasons why leasing agents miss the mark when collecting data during the leasing process.
The first problem stems from how onsite associates are typically paid. Their compensation is often based in part on how high their closing ratios are. It’s hard to expect an associate to create guest cards for prospects they feel are unlikely to sign a lease when it’s going to hurt their compensation. This leads to operators believing a community’s overall closing ratio is higher than it truly is. In reality, it is often substantially lower.
Another reason stems from data entry. Onsite leasing agents are often saddled with cumbersome, inflexible lead management systems that require agents to be at their desktop computers to enter data into the systems. Any information the agents gather away from their computers is likely lost.
Though agents may expect to manually input valuable information gathered during a property tour into the lead management software, they have many demands on their time. It’s far from uncommon for an agent to get back to the office after a tour, get swept up in the dozens of other things he or she has to do, and simply forget to create a guest card for the lead or to enter additional data if a guest card already exists. We all know that data is lost at each manual entry hurdle.
The Impact of Insufficient Data
Inaccurate closing statistics have several negative impacts. To start with, when operators believe their agents are better at closing than they are, they’re less inclined to provide the training their agents need to improve their skills and achieve high closing ratios in reality. Strong, accurate data provides managers and their associates with invaluable insight into how agents’ sales techniques are working.
Second, when operators don’t have a full and accurate picture of who’s actually reaching out to their communities, they don’t know if their marketing dollars are being spent well. It’s especially harmful to have an incomplete record of who’s visiting a community. Data shows that a person who tours a community is a different type of prospect than one who just visits a property’s website. Operators want to make sure they’re designing their marketing campaigns to effectively reach the kinds of people who are visiting their communities. But if we don’t understand who our prospects are and what they are looking for, then how are we supposed to sell to them?
Less-than-ideal data collection can also bruise a prospect’s relationship with a leasing staff. Onsite teams sometimes make the misstep of not accurately recording how a prospect wants to interact with a community. It may seem like a small matter, but calling a prospect who prefers to communicate via text – or vice versa – can serve as a turnoff to that prospect.
Furthermore, poor data collection during the leasing stage can negatively impact pricing. Leasing agents often fail to record why prospects don’t lease, because they’re moving on to the next prospect. When communities experience a dip in leasing, the first and natural instinct is to reduce pricing. But rental rates are not the sole reason prospects decide to live elsewhere. Often the issue is location, pet amenities or some other non-price factor. But when operators don’t have a firm grasp on this data, it’s easy to list price as the reason for not leasing.
So What’s the Answer?
First, apartment companies must build a culture in which agents and managers truly understand the importance of data collection to the big picture. Each company must teach its employees that it becomes healthier – and more profitable – when it has the insight that accurate and complete data provides. When onsite associates comprehend their indispensable role in this effort, they are likely to be more diligent about gathering the information operators need.
But education only goes so far. To truly solve the problem of insufficient data, apartment companies need a leasing system with a clean, easy-to-use interface that facilitates data gathering. This system must allow agents to quickly and efficiently enter information, whether they are at their desk or on the go.
Ian Andrews is co-founder and principal of Power Pro Leasing, an iPad-based leasing technology.