The Five Star Community: The Importance of Online Reviews to Renters & Multifamily Professionals
The Five Star Community: The Importance of Online Reviews to Renters & Multifamily Professionals Background: With consumers across all industries increasing their use of reviews, Apartments.com initiated research efforts to dig deeper into the growing trend. Slack and Company was engaged to complete a comprehensive research project to obtain unbiased opinions from multifamily industry professionals about ratings and reviews. Specifically: How those industry professionals currently manage their online reputation How they feel about online property ratings and reviews What components of reviews they feel are most and least appropriate The Blackstone Group was also engaged to conduct a comprehensive research project to learn: How renters are using apartment reviews How important reviews are to them What plans renters have for the future Both studies were blind and anonymous research surveys, designed to obtain unbiased input, one study from renters and the other from multifamily professionals. In addition to our research findings, Cars.com, a listing service with a similar business model to Apartments.com, launched reviews on their website in February 2011. Given the similarities of online shopping for cars to the online apartment search experience, we also compared the findings of our research to a Cars.com dealer review study they conducted prior to the launch of reviews, and then again compared those to the actual results of the reviews posted to their website. We found the Cars.com dealer study to be very similar to the key finding from the multifamily professional study. Key Findings from the Consumer Study Renter Behaviors and Attitudes...1 Key Findings from the Multifamily Industry Study Reputation Management Activities...3 Opinions of Reputation Management...3 Summary of Findings Apartments.com Consumer and Multifamily Industry Studies...4 Cars.com Dealer Survey Findings...4 Cars.com Actual Dealer Review Results...5 Apartments.com Research Approach Consumer Respondent Demographics...6 Multifamily Professional Respondent Profile...6 About Us...7 THE FIVE STAR COMMUNITY: THE IMPORTANCE OF ONLINE REVIEWS TO RENTERS & MULTIFAMILY PROFESSIONALS
Key Findings from the Consumer Study Renter Behaviors and Attitudes We asked consumers if they have used reviews as part of their decision making process when finding a new place to live. The overwhelming majority, 80% of total respondents, indicated they have used reviews as part of their search. For the 80% of renters who used reviews in their search, there doesn t seem to be a dominant destination for finding community reviews, although ApartmentReviews.net and/or Google were most commonly cited as their source. Renters Who Used Reviews as Part of Their Apartment Search 80% Yes 20% No 50% 46% Sources Renters Used to Read Apartment Reviews 33% 25% 17% 11% 9% 3% ApartmentReviews.net Google.com ApartmentRatings.com Yelp.com ApartmentGrade.com Don t Recall DoNotRent.com Other 73% of consumers indicated reviews are extremely helpful. When asked to rank the helpfulness of reviews, 73% of renters indicated reviews are extremely or very helpful. Only 1% of renters indicated reviews are not helpful at all. Extremely/ very helpful Somewhat helpful Not very/not at all helpful Helpfulness of Apartment Reviews 1% 26% 73% Since apartment reviews are relatively new, we wanted to know a little more about renters who have posted apartment reviews. We found that only 23% of renters indicated they have posted an apartment review. Renters Who Have Posted Apartment Reviews 23% Yes 77% No THE FIVE STAR COMMUNITY: THE IMPORTANCE OF ONLINE REVIEWS TO RENTERS & MULTIFAMILY PROFESSIONALS 1
It appears that the 23% of renters who posted a review had positive intentions, since 76% say they did so to help others. Only 5% indicated they wrote a review because someone asked them to write it. 76% Why Renters Write Apartment Reviews 41% 37% 35% 5% 3% Help others Negative experience Positive experience Help support apartment Someone asked To correct wrong info We asked the renters who posted reviews; at which stage in the search process did you post a review? Surprisingly, 32% posted a review after visiting a community, compared to 44% who posted a review after moving into their apartment. 85% feel having review information is very important. Regardless of whether a renter had used reviews as part of their search or posted apartment reviews in the past, we wanted to know if they consider reviews important. We asked renters to rate the importance of having review information available and found that 85% feel having review information is extremely/very important. While 85% of renters highly value reviews, it seems more renters are likely to read an apartment review than actually write or post one. Only 52% of renters indicated they are extremely/very likely to write an apartment review in the next 12 months. 44% When Renters Posted Apartment Reviews 32% 24% Importance of Having Apartment Reviews Available 85% 14% 1% Likeliness to Write a Review 52% 37% 11% After moving in After visiting After moving out Extremely/ very important Somewhat important Not very/not at all important Extremely/ very likely Neither likely nor unlikely Extremely/ very unlikely THE FIVE STAR COMMUNITY: THE IMPORTANCE OF ONLINE REVIEWS TO RENTERS & MULTIFAMILY PROFESSIONALS 2
Key Findings from the Multifamily Industry Study Reputation Management Activities In general, multifamily professionals seem cautious about dealing with renters in the online world, where anything can be made public. In regard to negative reviews, most prefer to contact the person directly, if possible, rather than posting a reply online. Property professionals simply want to avoid an online argument or back-and-forth situation that could appear unprofessional. Virtually none of these professionals have tried to get people to change reviews nor have they requested reviews be removed. Multifamily professionals indicated their belief that it is inappropriate to ask reviewers directly to edit their comments. Very few property professionals have asked residents/prospective renters to post their feedback online. Some property professionals are uncomfortable asking for feedback or feel that it is not their place to ask and feel people should do it themselves without their influence. Yet, others said they are just too busy to ask. Opinions of Reputation Management Multifamily professionals have very mixed feelings about online ratings/reviews. The industry professionals contacted in our study were virtually split into thirds; one third each liking, disliking and feeling neutral about online property reviews. Upside: Property professionals believe positive reviews can be a good marketing tool. Many of these professionals see the value in being made aware of issues that may otherwise be unknown to them (i.e. perhaps a resident is uncomfortable talking about the issue in person.) Property professionals also believe positive reviews can be a good marketing tool. In addition, they feel prospective renters should be informed about the good and bad of properties. Downside: Many multifamily professionals fear what public exposure might do to their reputation when this platform is misused and there is one-sided or inaccurate reporting of the facts. This is primarily driven by the perception that most people who write reviews are angry or vengeful. Property professionals indicated the lack of specificity in reviews can make things worse (e.g., when residents say management stinks or don t live here without any explanation). Many of these professionals cited a feeling of lack of control, because anyone can say anything without accountability. And finally, some professionals indicated a suspicion that competitors can write disparaging reviews on other property websites or glowing reviews on their own website. THE FIVE STAR COMMUNITY: THE IMPORTANCE OF ONLINE REVIEWS TO RENTERS & MULTIFAMILY PROFESSIONALS 3
Summary of Findings Apartments.com Consumer and Multifamily Industry Studies: 80% of the renter respondents indicated they have used reviews as part of the apartment search process. With ApartmentReviews.net, Google and ApartmentRatings.com being the most commonly cited sources. 73% of this group indicated reviews are extremely/very useful. Only 23% of renter respondents have posted apartment reviews. The intent was positive, with 76% of them indicating they posted a review to help others. While 85% of renter respondents said having apartment review information is extremely/very important, only 52% of the respondents indicated they are extremely/very likely to post an apartment review in the next 12 months. While multifamily professionals in general, seem cautious about dealing with renters in the online world; they believe positive reviews can be a good marketing tool and understand the value to the renters. Generally, these professionals have the perception that most people who write reviews are angry or out for revenge (compared to the previously stated 76% of those posting reviews who indicated that they did so to help others). Cars.com Dealer Survey Findings Cars.com conducted an extensive qualitative automotive dealer study prior to the launch of reviews on their website in 2011. The findings from that study are very similar to those of our multifamily industry study. Most dealers were monitoring online ratings and reviews. Some larger dealers very actively and systematically managed their online reputations. Lower volume dealers, regardless of market size, were likely to at least monitor their online reputation regularly. Dealers were split in their overall opinion of reviews: some viewed Dealer Reviews as an opportunity to build positive word of mouth, while others feared mostly negative reviews would be posted, overshadowing positive reviews. Nearly all dealers agreed online ratings and reviews of dealerships were here to stay. Dealers anticipated more consumers would visit and shop at Cars.com as a result of introducing Dealer Reviews. Concerns included negative reviews overshadowing positive and lack of review volume undermining credibility. Reviews from lead senders who did not visit the dealership were also a concern. Dealers stressed that reviews needed to differentiate buyers versus shoppers, dealership visitors versus callers and online browsers. THE FIVE STAR COMMUNITY: THE IMPORTANCE OF ONLINE REVIEWS TO RENTERS & MULTIFAMILY PROFESSIONALS 4
Cars.com Actual Dealer Review Results After Approximately One Year The reviews are not negative; the average score is 4.4. At the time of publication, there are more than 55,000 dealer reviews posted on Cars.com and posting continues at the rate of approximately 225 reviews per day. On average, there are three reviews posted for each dealership. Given the emotional and stressful experience of buying a new car, most dealers expected the majority of reviews to be negative. In fact, the reviews are not negative; the average score is 4.4 on a rating scale of 1 (worst) to 5 (best). Keys to success that can be applied to the multifamily industry: 1. After getting management buy-in and preparing your staff establish a company-wide process for monitoring, sharing and responding to reviews. 2. Respond to all online feedback about your community, good and bad, in a timely, professional fashion. Responding to reviews lets future residents know that satisfaction and responsiveness to them is important to you. 3. When responding to critical feedback, be sure to directly address the renter s problem with an apology and information about what you are doing to make it right. 4. Don t let problems leave your office/property. Always ask renters about their experience and work to correct any issues before they walk out your door. 5. Don t forget to ask for reviews. Most people will take the time to rate your business online, if you ask. 6. Listen to your renters and use online feedback as an opportunity to make improvements in your community. 7. Make positive online feedback part of your community s sales and marketing efforts. Renter endorsements build credibility and give future renters confidence in your community. 8. Do NOT fake online reviews or fall prey to service providers that claim they ll fix your online reputation. 9. Keep an eye on your performance/trends over time. Changes in performance can quickly alert you to otherwise hidden issues. THE FIVE STAR COMMUNITY: THE IMPORTANCE OF ONLINE REVIEWS TO RENTERS & MULTIFAMILY PROFESSIONALS 5
Research Approach Consumer Study Respondent demographics Age 34% 27% Gender 14% 15% 10% 59% Female 41% Male 18-24 25-34 35-44 45-54 55+ Blind, anonymous online survey conducted in April 2012 by Blackstone Group using an external consumer panel 500 completed online surveys by multifamily renters Criteria Participate in housing decision Currently rent Actively researched new rental in past 90 days Between 18 and 65 years old Live in the United States The margin of error on this study is +/-5% at the 95% confidence level. Multifamily Industry Study Blind anonymous qualitative study conducted by Slack and Company in April 2012 Twenty rental property-listing purchase decision makers were interviewed by telephone To qualify, these professionals had to currently advertise on Internet listing services and have either contract authority or the responsibility of property manager Please note this is qualitative research. As such, the conclusions presented here represent the opinions of the individuals who participated. These views may or may not reflect the views of the market as a whole. THE FIVE STAR COMMUNITY: THE IMPORTANCE OF ONLINE REVIEWS TO RENTERS & MULTIFAMILY PROFESSIONALS 6
About Us Apartments.com Apartments.com is a national online resource for individuals looking for an apartment whether it is down the street or across the country. To simplify the process of finding a new place to live, Apartments.com offers renters one of the most comprehensive databases of millions of apartments around the country. By incorporating the most relevant products to reach renters, including personalized searches, walk-through video demonstrations, community reviews, a mobile website and apps for both iphone and Android phones, Apartments.com delivers a multimedia experience renters want while creating easy access to listings from any computer or mobile device. Slack and Company Slack and Company is an integrated marketing communications and research firm that for 24 years has worked with business marketers, helping to build their brands and generate profitable demand. They combine their deep demand-creation expertise with new marketing technologies and traditional and non-traditional communications pathways to help businessto-business marketers build strong business brands and efficiently identify, find, create, retain and grow profitable customers. Blackstone Group Blackstone Group is a global, full-service marketing research and consulting firm headquartered in Chicago. Since 1987, the Blackstone Group has earned its reputation for providing custom research, time-sensitive market intelligence and actionable strategic guidance to Fortune 500 companies and leading organizations in both consumer and business-to-business industries, including financial services, insurance, healthcare, technology, energy, and packaged goods. The Blackstone Group is a certified minorityowned/diversity firm. Sources: The Importance of Online Reviews to Renters, Blackstone Group, 2012 The Five Star Community: The Importance of Online Reviews to Multifamily Professionals, Slack and Company, 2012 THE FIVE STAR COMMUNITY: THE IMPORTANCE OF ONLINE REVIEWS TO RENTERS & MULTIFAMILY PROFESSIONALS 7
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