Don’t Forget About Resident Referral Programs
By Kim Morgan, Marketing Manager
“Birds of a feather flock together.”
That’s the saying that comes to mind when I consider the immense value of resident referral programs.
In other words, a quality resident – someone who pays her rent on time and in full every month, is respectful of her neighbors, and follows community rules and procedures – is bound to know other people who would make ideal residents. Resident referral programs are great ways to encourage your outstanding renters to help bring their friends and associates to your community.
In today’s multifamily marketplace, with so much emphasis being understandably placed on the role of sophisticated digital marketing tactics in attracting prospects, it can be easy to overlook the power of relatively old-school resident referral programs. But that would be a mistake. Operators shouldn’t put all their eggs in the digital marketing basket and should make sure they have an attractive resident referral program in place.
Below are some ways resident referral programs can be configured.
This is a longstanding, traditional type of resident referral program. It’s a simple concept: when a resident refers someone who becomes a renter at a community, that resident then gets a credit that’s applied toward the payment of one month’s rent.
The benefits are obvious: Who doesn’t like getting a discount on rent? That’s money that residents can sock away for a rainy day, use to treat themselves to something special, or apply to paying off their student loans or car notes. Simply put, a rent credit can go a long way.
A points-reward program
Instead of giving out rent credits, many operators, including JVM, are turning to vendor-operated rewards programs that award those referring new residents with points that they can redeem at major retailers.
At JVM, our referral program provides residents with credits to such companies as American Airlines, Best Buy and Banana Republic, to name just a few examples. It works like this: when someone refers a new resident, the referrer is awarded $250 worth of points. That person can then log on to their residents’ portal and redeem those points for whatever they want from a list of leading retailers.
We’ve found that our residents feel the impact of these rewards in a way that they sometimes didn’t with an automatic discount off their rent. Here, they’re actively choosing their rewards, and their rewards really feel like something special. One of our residents told us he used his referral credits to help buy airlines tickets for his kids to come visit him. That’s an experience he will always remember.
Seasonal gifts, credits for onsite amenities
Sometimes, operators reward a referral by giving a resident free parking for a certain period of time or free access to an onsite storage unit. Or maybe the reward is a $250 VISA gift card during the holiday shopping season, or the free rental of a poolside cabana during a summer month. The point is, there are other ways to show your appreciation outside of the traditional rental credit or vendor-operated rewards program.
In the end, the benefits of resident referral programs are several. First off, they can be a great source of new high-quality residents. Secondly, when you reward an existing resident for referring a new one, that strengthens the bond that existing resident has with your community and hopefully increases the likelihood that he or she will renew their lease when the time comes. And when residents have their friends and associates as neighbors, that increases their loyalty to a community as well.
Make no mistake: resident referral programs are great ways to bring in high-quality residents. Accordingly, apartment operators should make sure they have strong referral programs in place.