In 2021, the average senior living sales team generated 61.2 new independent living leads per month. Meanwhile, the best sales performers generated just 50.2 new leads per month. This might seem counterintuitive, but the conversion rates show otherwise. In independent living (IL) in 2021, the best sales performers converted 7.0% of worked leads compared to the median of 1.8%.
That’s a significant difference.
As the industry continues to battle back from the fallout of the COVID-19 pandemic, the data from sales-enablement platform Sherpa reveals four powerful trends that every operator needs to know.
Senior housing was largely recession-proof, but not pandemic-proof
When Lana Peck went to work for NIC in 2016 as their senior housing subject matter expert, the industry was embarking on a roughly three-year period of significant inventory growth that resulted in supply overhang in many markets, especially those with low barriers to entry.
Peck, who joined Sherpa in June as Vice President of Research and Analytics, notes that during her tenure at NIC, the industry saw senior housing occupancy pressure lower as competition from newly opened communities in markets such as Dallas, Phoenix, and Atlanta heated up.
“This is especially true for assisted living, which was favored by investors and developers coming out of the most recent financial crisis: the Great Recession of 2008,” Peck says. “History would show that assisted living’s need-based profile was resilient to the recession — our only recent point of reference. Although what we’ve been through in the pandemic was primarily a health-related crisis coupled with economic uncertainty and inflation, occupancy fell further and faster than in the Great Recession.”
Despite the pandemic, most seniors kept their timeframes to move
The lessons of COVID in senior living may be surprising, Peck says. Once seniors and their families felt more comfortable about senior living, most kept their move-in timeframes once the lifting of restrictions allowed it.
“It was remarkable to observe just how much the pace of move-ins closely corresponded with the broad incidence of COVID-19 infection cases in the United States,” she says. “When the vaccine became available, the industry saw an unprecedented wave of pent-up demand sweeping into communities in markets all over the country.”
Significantly, virus mitigation and visitation protocols adopted by the seniors housing and care industry to keep residents safe resonated with prospective residents and their family members, Peck says. According to a two-part survey conducted by ProMatura and ASHA and released to ASHA members in December 2020, among households that have considered moving to a retirement community within the past year, the majority of prospects did not change their time frame for moving.
This success can be attributed to the frequent, clear and credible messaging by senior housing communities and organizations, Peck says.
Creative sales teams won the day
As noted above, Sherpa research concluded that sales teams that worked fewer leads while using high-engagement strategies generated more move-ins during the pandemic than did others. In independent living in 2021, the best sales performers worked an average 83.9 leads per month compared to median sales performers that worked 172.6 leads. Best sales performers, working fewer leads more deeply, had 61% more independent living move-ins per month than median sales performers despite having spent only 12% more time selling than the median.
Using a same-store methodology with the same set of communities over the presented time series, the pace of independent living unit move-outs accelerated significantly at the beginning of the pandemic, while move-ins slowed significantly. Currently, the pace of independent living unit move-ins exceeds move-outs.
This analysis spells out an opportunity for organizations to evaluate current sales strategies to maintain gains recovered from the pandemic and continue to grow occupancy.
“Necessity is the mother of invention,” Peck says. “During the pandemic, senior housing marketing and sales organizations developed resourceful solutions to maintaining their lead bases and facilitating move-ins when the time was right for individual prospects.” Best sales performers in both 2020 and 2021 spent significantly more time planning than median sales performers to identify and prepare individually-tailored sale strategies.
Reacting to shutdowns early in the pandemic, innovative marketing and sales teams shifted both their messaging and their communication, engaging residents through tools such as video communication and an uptick in virtual tours.
“Digital marketing and workflow automation flourished while teams got back to the basics of selling with a twist,” Peck says.
CRM and marketing automation are the way forward
In a blog post summarizing Q2 2022 results, NIC MAP marked the fifth quarter that senior housing occupancy did not trend lower. NIC Analytics also recently indicated that in the largest markets they track, communities recovered about three-quarters of the senior housing units vacated during the pandemic.
Yet for senior housing in the largest markets, according to NIC, there is considerable ground to be made up in terms of the overall average occupancy rate. Of the 9.2 percentage points of occupancy lost from the beginning of the pandemic to the pandemic low rate, 5.8 percentage points of vacancy remain still to be recovered. Unfortunately, reliance on high-volume lead aggregators produces so many leads that sales teams cannot manage them without turning away from three key high-reward activities: home visits, creative follow-up and planning.
“Sherpa data from the 2021 Best Sales Performers Report indicate that investing time doing these three activities are the most effective in promoting and facilitating a buying decision,” Peck says. “Operators can increase occupancy by investing in a dedicated sales team and allowing them to specialize and focus on sales only.”
Additionally, a sophisticated Customer Relationship Management (CRM) and marketing automation tool are key to a successful effort around prospect generation and lead retention, Peck says. Sales teams may benefit from forming strategic collaborations with marketing teams to create uniform messaging from a prospect’s “first touch” forward.
“Going forward, senior housing owners, operators, investors and developers should understand that the nature of senior living sales is complex and unique. It is emotional and takes time: Time to generate quality leads, time to build relationships with leads and time to close,” Peck says. “I’m excited to be involved with Sherpa’s plan to launch an exclusive data initiative with indices and benchmarking built upon our proprietary senior living prospect and sales behavior datasets. This offering will be available to clients in the coming months and will be the first of its kind in the industry.”
This article is sponsored by Sherpa, a sales enablement platform that elevates the senior living industry by transforming the sales process with a Prospect-Centered Selling® methodology. To learn more and see the current report on assisted living move-ins, occupancy projection and new lead generation, visit SherpaCRM.com.
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