Senior Living Sales Metrics Improve But Teams May Be Missing Opportunities

Covid-19 has upended the way that senior living sales teams operate. The good news is that May numbers showed improvement over April — but there are also indications that sales pros are not using their time most efficiently and effectively.

These are among the takeaways from a newly released data set from Sherpa, representing information from 82,000 units, including independent living, assisted living and memory care. Sherpa is a St. Louis-based firm offering a sales enablement platform, providing methodology, CRM technology and sales analytics to the senior living industry.  

“Our data team is mining the data to provide insights to help improve sales effectiveness,” Sherpa CEO Pedro Soares told Senior Housing News. “As sales counselors’ time is curtailed by other non-sales activities, we are identifying where they should focus their time to improve their outcomes.”

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Improving performance

When Covid-19 began spreading across the United States in mid-March, senior living communities had to rapidly alter nearly every aspect of their operations. With buildings in lockdown to prevent the virus from entering and spreading, in-person tours and other sales-related activity came to a screeching halt. Over the course of April and May, however, sales and marketing professionals got creative to implement virtual tours and find other new ways of working. Meanwhile, infection control procedures were refined and allowed for a limited number of new move-ins.

Sherpa’s findings reinforce this narrative, generally showing that sales-related metrics began to plummet in March, were dramatically down in April, and began to tick back up last month.

For example, compared to 2019 levels, new leads were down 34% in March and 49% in April. However, they gained back some ground by ticking up 9% in May. Unsurprisingly, new leads generated by events took the biggest hit — down 91% in independent living and 96% in assisted living in April. Leads from other sources held up better. In independent living, the number of new leads generated by website/digital sources were down 52% in April and 41% in May, compared to last year. 

Courtesy of Sherpa

Across the senior living spectrum, move-ins were down 63% in April and 55% in May compared to a year ago.

Conversion ratios from visit to move-in have increased during the pandemic. In assisted living, the conversion rate was 39% in March, 52% in April and 65% in May. However, this is almost certainly due to the fact that consumers who are contemplating a move to senior living at this time have urgent needs, Sherpa Co-Founder and President Alex Fisher told SHN.

Move-outs, meanwhile, have slowed — they were 11% higher in April 2020 compared to April 2019, but only 0.30% higher as of May.

These numbers show that a feared “mass exodus” of residents during Covid-19 has not occurred, Fisher noted.

Especially encouraging is the fact that Covid-19 appears to be motivating some people to seek out independent living earlier than is typical — before they have physical needs — because they see the value of socialization and other support systems, Sherpa Co-Founder and Chairman David Smith told SHN. He has seen this first hand as an operator, as he co-owns The Gatesworth Communities in St. Louis.

“In 30-plus years of doing this, in IL, I’ve seen maybe less than 10 higher-functioning residents who said, ‘I’m ready, let’s talk about the selling process, I’m ready to buy,’” he said. “I’ve seen probably 10 or 15 of those in the last two months.”

Time per lead shows room for improvement

While the numbers seem to paint an encouraging picture in terms of April to May improvement, Smith warned against drawing too many conclusions from a three-month data set.

Still, the data suggests ways that sales teams could better adapt to the constraints of Covid-19, he and other Sherpa leaders believe.

Specifically, they point out that sales professionals have worked about the same number of leads over the last three months as they did during the same timeframe in April 2019; however, the time spent in the outreach zone is down 34% and the time spent per contact is down 49%. Overall time in the selling zone is down 30%.

These data points suggest that sales counselors have been working their database of existing leads during this period when new leads are coming in more slowly, but they are not maximizing the quality of interactions with prospects.

A few factors are likely at play. Some sales pros have been pulled off their sales activities to assist with other areas of operations during Covid-19, for one. But, sales teams might also be struggling because they are used to focusing on tours — now that tours are dramatically curtailed, they are not sure how to best use their time.

“The industry in general has been hyper-focused on tours to explain what sales effectiveness is, and the quantity of tours has been — industry-wide — a really big focus,” Fisher said.

But even as time spent on in-person tours has dropped from 2019 levels, time spent on other selling zone activities — such as call-outs, planning and creative follow-up (CFU) — has not increased to compensate. 

Courtesy of Sherpa

These numbers reveal a major opportunity for sales teams to increase their effectiveness, Fisher, Smith and Soares agreed.

More time spent planning will increase the quality of a phone call or other interaction with a prospect, which in turn should drive up the time spent per lead and drive more closed sales or commitments to move in. The tour to move-in conversion ratio is 21% when the sales team spends 1 hour or less with a prospect, but increases to 41% when the sales team spends 2.5 hours or more with a prospect, according to Sherpa data.

In order to de-emphasize tours and change the sales culture to prioritize better planning and engagement, senior living providers may have to dramatically shift their perspective, Smith said. 

“Most planning in senior living is, ‘What do I do with apartment 208?’” he said.

This type of thinking puts the empty unit at the center of the process, rather than the living, breathing human being who is actually going to make the decision whether to move in to a community.

Each day, sales teams should consider identifying just a few prospects — no more than four — to focus on in terms of robust preparation, Fisher recommended.

“Planning is proactive, and it creates better follow-up and better strategies — it prepares you for when you’re going to actually have a direct conversation with a prospect,” Fisher said.

Sherpa is working on an artificial intelligence capability to help sales teams identify which prospects to focus planning around, but even a less scientific approach bears fruit, Fisher added. The best performers spend around 30% of their day on planning activities, Sherpa data show.

This approach to sales is one that Smith has been preaching throughout his decades-long career in senior living, and he is hopeful that one silver lining of the “awful, unforeseen tragedy” of Covid-19 might be a shift to this mentality.

“It starts with the prospect instead of starting with the transaction,” he said. “So, you assess where the prospect is in terms of their readiness to make a buying decision, and you actually get into their emotional core to try to get life stories, elicit themes and values from their lives, so that they can hear themselves say those things — and that’s what takes time.”

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