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Inside Advice on Marketing Senior Housing - Part II By Phyllis M. Thornton This article is the second in a series of articles derived from Thornton’s Textbook & CD: Inside Advice on Marketing Senior Housing—The 15 Components of Success. Click here to view Part I Click here to view Part III Smart marketing is about asking and obtaining the answers to fundamental objective-setting and planning questions and then using that information to chart your plan’s course. Your quest for answers involves delving into all the elements that drive your occupancy: move-ins and attrition, quantity and quality of leads and sales, sources of leads and sales, and your close rate. Marketing consultants often refer to this assessment as a “marketing audit”. The audit analyzes all the forces and factors that make your marketing world go-round. Without this information, you end up with marketing happenstance, not calculated circumstance. A true and correct objective isn’t stated in subjective terms like “increase occupancy” or “build market awareness.” An objective is a measurable action path—complete with numbers. We’ll start with the sales objective, because the number of new sales the marketing program must secure dictates the number of leads (lead objective) you need to achieve the sales target. The sales objective is the number of sales the program must obtain in a 12-month period—the standard duration of a marketing plan. It’s the sum of two variables: vacant units and anticipated attrition. The lead objective is a projection of how many leads your program needs in order to secure the sales target. You calculate the lead objective by dividing the sales objective by a projected close rate. Sometimes referred to as the “inquiry-to-close rate”, this ratio is the percentage of qualified leads that are converted, or will be converted, to sales. The close rate is used in two contexts: 1) as a gauge of the sales team’s actual production (actual close rate=historical annual sales divided by qualified leads), and 2) as a performance target of the percentage of leads the team intends to close (projected close rate=sales objective divided by qualified leads). It is the projected close rate that is used in calculating the lead objective (lead objective=sales objective divided by projected close rate). Unless you have some monumental marketing barriers, you should always strive for a 5% or higher close rate. Here’s why: A masterful marketing program establishes control over two interrelated variables—the number of leads generated and the number of leads closed. While lead generation tends to get all the attention in a marketing program, it’s the number of leads closed (the close rate) that most influences the program’s results. If the sales team is adequately manpowered and is competent in courting and closing its leads, then fewer leads are needed to fulfill the sales objective. If the team is understaffed, or if the team is not doing its job, then marketing has to work harder to procure more leads to compensate for the sales staff inadequacies.
Keep this maxim in mind as you plan your program: If you want to be a strategic-minded marketer, you need solid skills in arithmetic and problem solving along with a good dose of common sense. It’s the science of marketing, not the art that separates the marketing heavyweights from the lightweights.
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