ULI Special Report: Do You Have Brand Loyalty?
To attract and retain residents today, you’ll need to think like a hospitality brand. Your residents are expecting it.
A growing number of multifamily housing providers are looking to the hospitality business as they seek both new residents and renewals. While hotels have long successfully focused on brand development and loyalty programs, it’s a different way of doing things for multifamily management, noted McKinsey & Co. partner Alex Wolkomir as he introduced the ULI Spring Meeting panel he moderated on Wednesday called “Cracking the Customer Loyalty Code in Residential.” But panelists have found success with both rental and for-sale housing, and while the opportunities are greater in the luxury segment, many can be applied in any category.
Andrew Min, RXR Realty; Ricardo Suarez, Four Seasons
“People really love living in high-level hospitality,” observed Andrew Min, senior vice president of strategy and digital initiatives for RXR Realty, which offers both condominiums and rental units. A big component, he’s found, is the personal touch. A seemingly simple thing like the concierge remembering a birthday can make a big difference to a resident, yet historically it required an experienced concierge with a good memory. And hiring enough people with that level of skill can get expensive.
RXR employs technology to achieve success. An internal CRM database of resident-provided information supersedes the need for human memory, with daily prompts alerting staff to the moments that matter. Alerts also reduce gaps in communication about service requests, ensuring that staff members reach out to inform the resident of any delays so they are not left wondering if they’ve been forgotten.
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Data collection and analysis can help with other personal touches, as well, Min noted. For instance, evaluating energy use by unit and advising a resident if, say, a two-degree thermostat adjustment could put their energy expenditures better in line with the average in the building wins appreciation at no extra cost.
Endless race in the amenity space
Amenities may seem a more obvious means to garner loyalty and establish brand identity, but that also requires some careful consideration. There’s been an “endless race” to add more and more amenities, noted Ricardo Suarez, group head of development for the Four Seasons, which with a 60-year-old hotel brand and a 40-year-old residential business has long studied customer preferences and applied them to housing options. But it’s important to focus on what people actually use if you want it to resonate—and in the case of rentals, if you want residents to renew.
Four Seasons can draw data from hotel amenity use, since about half of its homeowners have stayed in a Four Seasons at least 20 times before buying one of its condos and continue to choose Four Seasons hotels about twice a year. But apartment property owners that lack a hotel brand can collect data at their properties on how often an amenity is used, the type of user or usage, length of use, and preferred days and times. Incorporating emotional intelligence to make amenities “come to life,” Suarez said, is “where AI meets EI.”
Andrew Min, RXR Realty; Ricardo Suarez, Four Seasons
Adding in a level of flexibility can further position amenity spaces for greater use, advised Kelly Mack, president of Corcoran Sunshine. COVID brought that into focus as more people expressed a desire for work-at-home accommodations, but other preferences are likely to emerge over time, and it’s best to ensure easy adaptability to meet new needs.
Even in the shorter term, a space that can serve different functions without much change can prove attractive, she pointed out. For instance, the same space could host a children’s birthday party or an elaborate dinner. But to get used, that space also needs to be situated properly. Placing it next to the gym, for example, will make it undesirable, while including a catering kitchen next door will make food service easier.
Incorporating experiences can also increase amenity usage, and expectations are increasing, Mack advised. For luxury housing in a big city, that may mean drawing on local features, such as offering a tasting with a world-renowned chef, a master class for residents’ children with a local NBA player or an on-site museum lecture. Such activities also serve a very basic post-COVID need to get to know who their neighbors are. “People clearly crave this,” Min observed.
Keep track of how your efforts are received, though. In fact, the more data you collect on how common spaces are used, the better, Min emphasized. Over time, that could even allow you to measure how amenities and personal touches can impact level of complaints vs. positive reviews or even predictions on renewals.
And it will make you more competitive against what Mack foresees as a growing array of customer service-oriented housing providers—including more hospitality brands.
