Reality of Reputation
No one goes shopping today without checking reviews. From our shoes to our cars to restaurant reservations, we don’t make a decision without checking with the opinions of complete strangers. Our potential residents are no different. Renters are checking 7-10 different sources before they come visit you and 3 of those sources are typically review sites.
Reputation isn’t just about reviews. It goes so much further into how you are perceived because of the actions you and your company take every day. Have any of you ever checked out a resident on Facebook or Twitter? Think they aren’t checking up on you? You’d be surprised! Even if someone is not your friend, they can see the majority of what you are doing online and what people are saying about you. Everyone has freedom of speech, but in the age of the Internet you do not have anonymity.
So what is the value of your reputation in this crowded and highly competitive leasing environment?
A study from Berkeley published that “A simple half-star improvement on Yelp’s 5-star rating makes it 30-49% more likely that a restaurant will sell out seats during its peak hours.” (Berkeley, 2011)
So you can see the direct correlation for restaurants, but what does that look like for apartment communities?
For two years, WC Smith as policy responded to every review on each of the rating sites-positive and negative. Because that is what the basic reputation mantra was. “Make sure you respond to all the reviews in a timely fashion.” Honestly, I didn’t see the value in making the reviews any more of a priority than that. Most reviews were positive, but when they were negative, they were really negative and our overall score as a portfolio was 68%. Now, the national average is 48%, so if we were graded on a curve, we’d be a B-.
The corporate website yielded some traffic from Yelp and Apartment Ratings, but it was nominal.
My light bulb moment
On our last lease-up we did not use a single ILS. We focused on event driven marketing with social experience and exchanges both online and in person. The lease-up was completed in four months and as I began the case study on the project, we noted one of the highest referral sources was Yelp.
Deciding to give reputation management a little more attention, WC Smith enlisted Satisfacts to run our resident survey program. Since we were now reaching a broader base of our residents and encouraging them to review us, the number of reviews increased over 1000 percent. Our overall portfolio rating increased from 68% to 88%. If we are still using that grading curve from earlier, we went from a B- to an A-. That alone was reason to celebrate our staff. But was there an actual ROI for the time, focus, and dollars we spent for the survey program? A sucker for data, I couldn’t wait to get my hands on the results and they knocked me right off my chair!
It’s not just that traffic increased from Apartmentratings.com and Yelp; it’s the conversion rates of that referral traffic that drove home the value of our reputation.
In a YOY comparison of traffic from September to October traffic to the corporate website from the review sites increased:
This is a YOY traffic comparison from my corporate website analytics. It’s not hard to see the bump in traffic that came in from the review sites, but increase in conversion rates of that traffic is off the charts!
60% increase in traffic from apt ratings
109% increase in traffic from yelp
317% increase in conversion rate for apt ratings
75% increase in conversion rate for yelp
All that to say the increase in rating resulted in 50 extra leads in one month. Our closing ratio is about 30% from online lead to lease so this increase in rating average resulted in 15 extra leases. At WC Smith the average lifetime value of a customer is about $100,000. 15 extra leases in one month equals $1.5 million in revenue. So, does reputation have an impact on your bottom line? YES. Without a doubt.
Reputation management and the survey program is like investing a penny on advertising and magically turning it into a dime.
Myself, Jen Piccotti, Lia Smith, and Jeremy Lawson will be at NAA June 25, 2015, talking about how to turn scathing customer service issues into a marketing opportunity for your community. I look forward to seeing you there!