Multifamily owners and operators are always seeking new and better ways to engage with prospective tenants and improve their conversion rates.
Chatbots—software applications that reside on a community website and act as interactive “robots” that interact with prospects and provide them with information—are an additional tech tool that landlords and managers are adopting in increasing numbers.
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But while many tout a bot’s ability to capture leads and convert them to leases, some industry professionals have conducted tests on their effectiveness and aren’t as convinced they are necessary.
According to Sarah Yaussi, vice president of business strategy for the National Multifamily Housing Council, chatbots “have been all the rage” at the trade group’s last two OPTECH Conferences. And with good reason, she said.
“Pre-chatbot, (prospects) would email or call, and a lot of times they would go unanswered because leasing agents are often overburdened,” Yaussi told Multi-Housing News. “So, the idea of having at least a simple level of engagement to answer frequently asked questions is hugely helpful.”
Chatbots, which pop up on the screen of an apartment community’s website, come in two flavors. The basic variety gives users the opportunity to click on information boxes generated by the bot that provide basic information to the user, such as pet policies and floor plan availability. There are also AI-powered chatbots that use natural language processing and allow users to type in questions. The bots, which learn over time, then comb the website to find answers.
The biggest advantage of a chatbot is 24/7 availability. “Users get the information they need right away, when they need it,” said Nick Kljaic, co-founder of New York-based Apartment Ocean, which offers conversational AI assistants for property management websites. “Assistance is in the palm of their hand,” he noted.
For apartment owners and operators, the bots allow routine tasks normally handled by leasing agents—such as providing basic information or scheduling property tours—to be automated, freeing up their time. Chatbots also help qualify leads and have been essential at capturing leads that might have been lost while leasing offices were closed due to COVID-19.
Bell Partners, an apartment investment and management company in Greensboro, N.C., recommends chatbots as part of the “standard platform” for the 63,000 apartments it manages. But two-thirds of Bell Partners’ portfolio is managed by third-party companies, so it’s the owners who ultimately decide what type of technology they prefer to promote their communities, according to Rebecca Shaffrey, senior vice president of corporate services.
“We had a problem several years ago where we could see hits to our websites—our number one source for leads—but we had no way to engage with those leads,” Shaffrey told MHN. “What we love so much about chatbot technology is that it’s meeting our leads where they’re finding us, on our websites, and it’s convenient for those leads at all hours of the night and day.”
According to Shaffrey, more than 50 percent of the conversations Bell’s bots have are after business hours, at a time when leasing agents aren’t available. Bell’s properties are averaging about 3,000 chatbot greets per month per property. Of those, about 30 appointments get scheduled for tours, resulting in 7 to 12 leases per month being signed just through that channel.
AION Management, a Philadelphia-based property management company with 12,500 units under management, has had a similar experience. Angie Cramp, the firm’s vice president of marketing and training, told MHN that the number of property tours booked through the use of chatbots is “staggering.”
At Yorkshire Apartments in Silver Spring, Md., between October 1, 2020 and March 23, 2021, as many as 1,197 conversations took place between prospective tenants and the chatbot, 526 of which were after business hours. Of these conversations, 107 tours were scheduled by the chatbot and 23 of these leads converted to leases. The bot also had 24 conversations with prospects in Spanish.
“It has allowed us to offer an alternative to 9-to-5 leasing hours,” Cramp said. “And since the phones do not stop ringing at these properties, it allows both prospects and residents to have another option to communicate with our company without having to be put on hold.”
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Morgan Properties, an apartment management and investment firm also based in Pennsylvania, has found that it takes less time for a lead to sign a lease when the bot is involved. If a lead calls or emails, it generally takes 30 to 45 days until lease execution, according to Kim Boland, Morgan’s director of digital marketing. But when the bot is involved, the lead converts to a lease within 13 days.
Some are Not Convinced
Kelley Shannon, senior vice president of marketing and customer engagement for Bozzuto Management Co., said the company is currently running A/B tests on 10 community sites to see whether chatbots make a measurable difference.
“For us, it hasn’t shown that there’s a significant difference,” she said. “We believe it’s because we focus on making our websites as strong as they can be, and when you have a strong website that already has the best practices for getting consumers information—tour scheduling, real-time pricing and availability and floor plans you can interact with—widgets like chatbots become less necessary.”
Chatbots are making a difference, however, on websites that are older and “in need of some renovations” because they help users better locate the information they need.
Where Bozzuto has found more value, Shannon said, is with digital leasing assistants like MeetElise, which uses AI to answer prospective tenant inquiries, whether via email, call or text, and also follows up with those leads.
“Most of the time, people don’t even know they’re interacting with a computer,” she said. “We named our version of MeetElise ‘Ivy,’ and people have come into the leasing office asking to meet Ivy because she was so helpful. That’s perplexing but awesome.”
If you plan to adopt chatbot technology—or even just test it—here are some best practices recommended by industry experts:
- Hone the script. Make sure you provide answers for questions prospects are most likely to ask, and that the responses are accurate. Otherwise, users are likely to get frustrated.
- Make sure the bot integrates with your property management system. “That way you don’t have to train it,” said Jackie Koehler, chief executive officer of Respage, a chatbot developer in Narberth, Pa. “It gets your real-time information and can help you track back your leads and leases.”
- Test, test and test some more. Bozzuto’s Shannon prefers A/B testing to studying historical data. “It tells you more,” she said.