A constantly evolving senior housing market presents a wealth of opportunity for operators to drive revenue growth and move the needle when it comes to occupancy.
But it all has to start with a finely tuned sales and marketing strategy, according to a panel of industry experts during the Senior Housing News Summit in Dallas this week.
The wants and needs of tomorrow’s senior living residents are subject to change every day, and catering to these preferences offer up a fair share of challenges to providers and organizations of all sizes.
To drive bottom line growth in accordance with these shifts, providers will be forced to redefine their sales and marketing strategies, including how they view occupancy at their well-performing communities and getting non-sales personnel involved in the sales process.
“We’re in an interesting place that when it comes to the sales side of our businesses, we can be very complacent in many cases,” said Traci Bild, founder of Bild & Company, who moderated Thursday’s panel discussion. “It feels like everyone is resting on their laurels, but there’s a lot of competition out there.”
In redefining one’s sales force it is critical to have a “grow revenue now mentality,” according to Shamim Wu, executive vice president of sales for Holiday Retirement.
“As we look at knocking down the next barrier, a challenge we face is how do we, as a sales force, grow and impact revenue today,” Wu said. “It’s a balance of mission and margin. We want to be sensitive to our leads, but we have to be savvy and do deep discovery, making sure we ask the right questions to drill down and get the right information.”
This is especially important when it comes to increasing occupancy and providers’ complacency with current census, specifically when looking at better performing properties.
While there might be less pressure for a community to increase occupancy if it’s already at 90%, the reality is those communities can add to the bottom line much faster than a property that is struggling at 80% or even 70%, said Gary Fernandez, vice president of national sales and marketing for Dallas-based Capital Senior Living (NYSE: CSU).
“More focus on those properties can make a big difference a lot quicker,” he said. “We have to come to grips with the reality of sales and how it impacts the bottom line.”
The challenge, however, is that providers typically want to spend less on sales and marketing as occupancy rises, said Bruce Byers, senior vice president of marketing services for Greystone, also based in Dallas.
“First thing that happens when we get to 90-95% [occupancy] is there’s a cut in the marketing budget, almost across the board,” Byers said. “A challenge is getting management to understand that marketing is not a cost — it’s an investment.”
Part of what’s led to complacency, even at the community level, is a lack of defining the difference between sales and marketing. This often leads to budgets being cut because there’s an assumption that the person doing sales is the person who should also be doing the marketing, Wu added.
“There is a tendency to lump it all into marketing,” she said. “Marketing is lead generation. Salespeople are the ones who create revenue and drive it into your building.”
Executive Directors are Key
The key to driving revenue, panelists agreed, had to do with fostering a relationship between the sales director and the executive director of the community, making them a part of the sales process.
“The executive director is your ticket. When you have a sales-focused ED, our job is 10 times easier in filling a building,” Bild said.
This means having the executive director be a valuable point of contact in talking with prospective residents and their families, as well as training this employee to understand the sales process and develop a good balance between marketer and salesperson.
“Getting the ED involved in the selling process from the get-go is key to growing sales and occupancy,” said Fernandez. “Every time the ED is involved in sales, occupancy grows. They know and can hold the sales director more accountable to the performance of getting people moved-in sooner rather than later.”
Including specific leadership positions in the sales process can also help a community facilitate a culture change, but it will require a certain level of investment in terms of training and education.
“Getting management to see the value versus the expense is where the challenge is, but we have to break through that barrier because training is going to make a world of difference,” Fernandez said.
Written by Jason Oliva