As a recognized multifamily tech stalwart—and one rumored to be working on a groundbreaking application for the Apple iPad to complement its existing mobile and augmented reality apps—you’d think that Highlands Ranch, Colo.-based real estate investment trust UDR would be pulling in smart phone lease applicants hand over fist. In reality, the company logged only about 100 leases via mobile last year, according to company president and CEO Tom Toomey. That doesn’t mean the company is going to stop trying, as data indicates a full 11 percent of unique visitors to the UDR website came through mobile devices, even if they weren’t executing leases with their handhelds. “You have to get to that point in the road where the public expects you to be,” Toomey says of UDR’s marketing efforts. “A lot of it is keeping up. You just have to do it, and if you don’t, you are going to miss out on the bulk of the renting population.”
In an effort to more deeply target that would-be renter demographic, UDR and other firms across the multifamily industry are seeking to tailor and deliver their marketing message to a specific brand of consumer—those who have been geo-located via smart phone technology or other means as being “in the neighborhood.” We’re not talking about zip code-based direct mail. Geo-location awareness—the science of marketing to consumers by matching up smart phone geographical location with user-identified browsing and purchasing preferences—opens up a virtual door to real-time customer interaction based on a locality.
How important are local neighborhoods to today’s rent prospect? Consider that 37.1 million people moved last year, an increase over 2008’s 35.2 million movers that the U.S. Census Bureau attributes to households moving within their own counties. According to results of the Census Bureau’s 2009 Geographic Mobility study, which was released in early May, 67.3 percent of all movers stayed within the same county last year; and a mere 12.6 percent moved to a different state. Within the apartment sector, the 2009 move rate was also notable, with 29.2 percent of renters changing addresses between 2008 and 2009, compared to only 5.2 percent of home-owners opting for new digs.
“We certainly see a ton of interest in local level information from the popularity of interactive maps to our link out to walkscore.com, which is the No. 1 exit link off the site,” says Mark Moran, vice president of marketing and business development for San Francisco-based ILS MyNewPlace.com, which gets up to 200,000 clicks on local maps in a given month. “We also have city and neighborhood pages that are more likely to be accessed via Google search.”
As 2010 unwinds, economic factors will continue to drive relocations, which means locality will likely stay critical to apartment marketing. Technology focused on local demographic nuances—from revenue management systems forecasting market demand or mobile marketing apps delivered to local neighborhoods—will be integral to how apartment firms respond to the fluctuating pool of rental prospects just outside their front doors.
What It Is
For apartment marketers born on zip-code-parsed direct mail, geo-located mobile marketing shouldn’t be too much of a hump to get over: It is simply marketing tailored to neighborhood areas with predetermined consumer demographics and buying habits. Only now, you can draw an area based on where your prospects are in real time, and you can forget about licking the stamps.
“Apartment firms aren’t necessarily thinking, ‘Can I send this message out to people within 10 miles of my property?’” explains Darrin Clement, CEO of Norwich, Vt.-based Maponics, a location-based data and services provider that helps to power ultra-local search and mapping platforms for clients such as Google, Twitter, and Zillow. “They want to send out the message to people in a specific school district, or a specific zip code or type of pre-characterized neighborhoods: essentially multidimensional geo-polygons. When the lightbulb goes off on that, marketers say, ‘Oh, wow, it’s marketing by area’ and just sit back. For mobile marketing, it’s become the new magic moment.”
Virtual mapping experts say neighborhood and geo-polygon area marketing promise huge benefits over point-to-point (delivery to a single, fixed location) and radial (delivery within a set distance) geo-fencing applications. Polygon geo-fencing allows senders to tailor the shape, size, and area of message delivery, choosing neighborhoods and demographic areas that either fit or don’t fit the marketing push du jour.
Think Spatially
While consumers have been fairly open to sharing their geo-location via cell phone, privacy and safety concerns are beginning to push a trend towards more ambiguity in user-allowed geo-locating. And phone owners seem more comfortable reporting their presence in certain neighborhoods. Location vagueness isn’t weakening outreach to those users, however. “Neighborhood boundaries allow you to start drawing much more powerful demographic-type information that you can leverage against retail [and consumer marketing],” Clement says. “If I’m an apartment owner and I want to start driving push ads and I’m in Soho, I’m probably going to get a lot better response from people who are in Soho than people who might be in an adjacent neighborhood even if they are closer by the straight line distance.”
Apartment marketers could do well to ally themselves with other neighborhood retailers in addition to—or even in lieu of—direct geo-marketing, say industry advertising experts. “I think local geo-marketing is a really good community relationship building tool, but as an apartment owner I’d be wary of how you deliver your message,” says Elysa Rice, emerging media consultant at Dallas-based multifamily marketing firm Ellipse. “Residents don’t want to feel like they are being constantly advertised to when they really only make a moving decision once a year, but if a resident received a pizza discount and the property was the one who posted it, there is a little more cool factor as a result of the combined marketing.”
The bottom line: This kind of technology leveraging is the way of the future and vital to preserving fundamentals. Just don’t over-rely on the technology. “The industry is becoming more technology-oriented and leveraging the more modern tools [for leasing success] that we were not commonly using two to five years ago,” says Hessam Nadji, senior vice president and managing director of research services for Encino, Calif.-based multifamily brokerage firm Marcus & Millichap. “Obviously, the quicker you adjust to the market, the quicker you can preserve occupancy. Still, you cannot stop relying on boots on the ground and faces greeting potential renters, no matter what you have on the technology side.”
