Why Geofencing Is Top of the Marketing Funnel
As a tool to target prospective renters, this technology is growing in popularity among property managers.
Some in the multifamily industry may have once had doubts about geofencing’s potential in targeting prospective renters. But fewer and fewer companies remain on the fence about the technology’s current capabilities and future promise. Experts report geofencing is capable of ever more tightly narrowing the search for prospects. Once they’re identified, targets can now be met not just with a banner, but every kind of ad.
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Geofencing has a distinct role to play in marketing apartments. It exists at the very top of the marketing funnel, before prospective renters begin to actively search for a rental community. These prospects might be in a coffee shop, supermarket, fitness center or a rival apartment community in the geographic area of the property being marketed. They could be hanging out in a popular entertainment district, or working in an employment hub. Destinations where visitors may be meandering around and checking their phones regularly, such as a green space perfect for a picnic, are thought ideal by marketers.
At this moment, before the prospects have begun searches, property managers must make them brand aware, drive their interest and make the marketed property visible.
“We’ve had to reinforce that this is not a lead generation campaign,” said Taylor Fulton, senior product manager for RentPath, a digital marketing solutions provider that helps renters find apartments or houses to rent. “It’s really focused on brand awareness. In lead generation, leads are already aware. Geofencing nurtures them.”
As these prospects move further down the marketing funnel, campaign strategies like search and social in mid-funnel can successfully convert users to leads, he said.
Geofencing efforts can also be analyzed to determined campaigns’ return on investment, or to fine tune a campaign in mid-stream, which many property management companies find exceptionally beneficial.
Property management companies could determine, for instance, that in a given month 10 percent of site traffic resulted from geofencing, or that x number of prospects who had been served a geofencing ad walked into the property.
“We’re able to identify which geofenced locations are highly effective, and we can determine return on investment for specific locations and dial that up or down accordingly,” said Joya Pavesi, executive vice president, marketing and strategy for RKW Residential in Charlotte, N.C. The company has 30,000 units under management, translating to 60 to 65 properties in seven states, mainly in the Southeast. “Geofencing doesn’t work for some properties. And for others it works incredibly well.”
How it operates
Some marketers target in the range of 15 to 30 properties that are specific to the target market, and may include cafes, grocery stores, business parks, office buildings and even competitive apartment properties. Once mobile device users enter that geofenced area, mobile display advertisements can be deployed through the mobile network.
If upon seeing a banner ad, the recipient clicks on the ad, he or she is delivered to the apartment community’s website. Upon reentering that fenced area, the ad reappears.
Competitive apartment communities are often some of the most effective places to use a geofence campaign. It’s recognized the people on premise the most—residents—are inclined toward the renting lifestyle and in many cases have signed one-year leases.
This means those targeted are just months away from a decision that may involve a new apartment community.
The geofence campaign won’t get them to sign a lease immediately, but it will get the conversation started, resulting in more qualified applicants coming through the leasing office door, and the leasing team successfully signing more leases.
“If you’re looking for the lowest hanging fruit and the audience most likely to rent from you, you find the apartment community charging slightly more in rent, with less to offer in amenities, or maybe even one charging less but with less in amenities,” said Eric Grindley, founder & CEO of Esquire Advertising in Durham, N.C. “Or maybe it’s an older apartment building and you’re marketing a newer, more recently-built property.”
Some multifamily companies focus geofence initiatives on employment centers to try to reach would-be renters, and college campuses to target those who may be ripe to sign a lease at privately-owned, off-campus student housing communities.
One such company is Palladius, an Austin, Texas-based investment group. The firm focuses geofencing on area employers in order to reach their employees who may want to rent, said Jacob Sternberg, vice president of asset management.
RKW Residential may put a fence around a major employment hub such as Uptown Charlotte. “Within that radius, we will be able to target a large volume of prospective renters,” Pavesi said.
Among best practices is that property managers avoid simply placing random geofencing. They must rely on data about the most likely customer for their properties. Data on a competitor’s location can help marketers learn about demographic makeup of the residents leasing there, and better understand the renters in that market.
The goal is to shrink the audience to the community’s most likely prospects. Failing to do so can mean exhausting the marketing budget with little to show. “The relevant universe will be smaller than the non-relevant universe,” Grindley said.
Management companies also should avoid erring on the side of placing geofences around targets too far from their apartment properties. In Houston’s Energy Corridor, for instance, it may be best to target prospects working perhaps 15 minutes from the marketed property. “If you target too far away, you could be wasting money, hurting your budget and it may not make sense to that specific renter,” Sternberg said.
It’s also important to choose the right digital marketing agency partner, and to grasp that partner’s strategy. “Our digital marketing partner is able to track walk-in attributions, weed out false impressions and remove duplicates,” added Pavesi.