Budgeting correctly for multifamily marketing campaigns is a critical function intertwined with the larger numbers of an operational budget. The process of establishing a budget lets management know what costs to expect from the marketing department, allowing it to firm up budgets for the rest of the operation.
Marketing directors and CEOs from real estate companies, property management firms and those handling marketing for multifamily owners agree best practices must guide the creation of budgets for marketing.
Communication with management
The creation of one-page dashboards issued monthly can help management understand how marketing dollars are being allocated. Campaign results can be examined as they come in month by month, and budget numbers adjusted. In this way, management is aware of what the marketing department is doing, leaving no surprises when budgeting season rolls around. Property and asset managers understand the overall impressions, the property’s visibility, what elements are bringing in traffic, how many prospects are shopping the community and how many visitors end up signing contracts.
This process of the monthly check-ins results in “no surprises,” said James Love, vice president of marketing for Draper & Kramer, manager of more than 8,000 units across Chicago, St. Louis and Texas. “The data makes it possible to track where millions of people are entering our marketing funnel, how long they’ll spend there in making a decision, and if and when they will enter a leasing office to sign paperwork.”
Ongoing reinspection of marketing budgets is also a vital best practice according to P.B. Bell, a company managing 17 communities in Arizona. “To ensure we are maximizing every dollar, we regularly evaluate our ROI, including number of leads and website traffic generated,” said Marketing Director Kristina Rauscher. “Being flexible and managing performance are keys in maximizing multifamily marketing spend.”
Listen to leasing teams
Another fundamental practice that will ensure a smooth effort into planning a marketing budget is consulting with the community’s leasing team. Before making its ad spending purchases for the following month, Clinton Management, which handles marketing for Douglaston Development, makes a point of speaking internally with all its leasing teams. The goal is to gain a sense of the current demand and of how quickly apartments are being leased.
“Understanding what’s happening on the ground should not be taken for granted,” said CEO Ryan O’Connor.
Among the most important best practices is avoiding sweeping examinations and taking deep dives into granular analyses of return on investment from various marketing strategies. Scrutinizing cost per lead and cost per rental application are two ways some marketing managers wade into the grainier detail.
“Sometimes we can have a decent cost per lead, but prospects are not closing,” Love said. “We can work with them through the year to adjust the advertisements, looking at the specifics of what would make a more productive ad, such as different copy, different images, different placements.”
Adjusting marketing spend to specific resident expectations, such as the reasonable inference of renewals of New York City apartments with legal rent caps, is another way to drill down. “When you’re running a portfolio and showing apartments, the degree of granularity you need to do this successfully can fall by the wayside,” O’Connor said. “You need to project your numbers in a holistic way that considers marketing spend in conjunction with other occupancy assumptions.”
Audit suppliers and partners
When year end arrives, make a point of conducting audits of vendors and partners. This effort can bring about the assurance solutions and services are being obtained at competitive prices, and deliver value.
“Overall, having flexibility both in spend and strategy, and ensuring your core marketing assets are superior, is (the) key to success,” Rauscher said.
Allocate to digital front door
In recent years, increasing numbers of renters have shopped for apartments online, narrowing their apartment searches, and compiling short lists before ever heading out to tour properties. This phenomenon merits greater dollars to help ensure the growth of experience and engagement taking place online.
“We can show right away the traffic data and conversions resulting from greater spending on photography, videography, virtual tours and self-guided tours,” Love said.
Make data king
The ever-increasing amount of available data to support decision making, particularly up-to-the-minute data, allows marketing directors with greater certainty than ever before to say, “If we spend x dollars here, we can expect this result,” added Love. For instance, it might be possible to argue with assurance that when new photos are added, the pipeline of emerging prospects increases.
Based on trends pinpointed in data showing surging New York City demand, Clinton Management recently pulled back some of its marketing spending. Instead of falling, its website traffic actually increased.
“We did not forecast a drop-off in success rate, and that came to fruition,” O’Connor said. “Data in its granular sense can make clear the larger macroeconomic trends in the market in a way that’s actionable.”