By Jack Cumming
Libby L. Lauer, co-founder and COO, Senior Source Consulting Group, asks on LinkedIn for feedback about reports that “CCRC prospects cast a much wider net in their search for their perfect (for them) retirement oasis, far beyond the typical 1 to 5 mile radius that is for rental communities — even looking into different states.” She’s looking for data. Ms. Lauer’s specialty is senior living sales and marketing.
Is It a Data Question?
Frankly, I know of no such study or data, but I would urge Ms. Lauer instead to approach it differently. I would suggest that this is less a data question and more a matter of preferences. The better a CCRC fits prospects’ preferences and expectations, the more likely it is to have high occupancy.
From a marketing perspective, why would a CCRC care whether a resident moves 4 miles or 4,000 miles? Either way, the CCRC gains a resident-customer to lift occupancy. Even for the resident, the difference is not that great. The resident’s challenge is in packing, unpacking, and fitting everything into the new space. Those challenges are the same no matter how far the move.
Advertising Buy
The underlying question may be how best to concentrate advertising. That depends on whether the CCRC property’s location and management reputation keep it full by word of mouth or not. Less desirable, less comprehensive communities require more sales intensity to overcome detriments. Conversely, occupancy is easier with properties that sell themselves with value and positive resident experiences.
We can start with the obvious. Some CCRCs, notably Beaumont at Bryn Mawr, sell themselves as places in which residents age with significance. Others, like Oakmont Senior Living in Santa Rosa, California, have positive websites but a questionable history, sufficient to be documented in a book. Such variability presents a marketing challenge that leads to prospects’ skepticism.
Even Leaders Stumble
This brings us to the nub of the question. My supposition is that Ms. Lauer has been retained to help a CCRC improve its occupancy. It’s a topic to which people have given considerable thought. For instance, Brookdale is said to be the largest operator of senior housing in the United States, with over 60,000 residents. Still, it struggles to get occupancy above 80%, while most of the industry considers 90+% as normal.
With revenues of roughly $3 billion a year, that occupancy shortfall is worth about $375 million (10/80 x 3B = 375M) less marginal costs of occupancy. That lost opportunity is enough to make grownups cry. Brookdale also is nationwide, so the question of whether new residents come from the locality or elsewhere is irrelevant.
From Good to Great
That, too, is my best answer to Ms. Lauer’s data question. Even if the data were available and 100% accurate and reliable, they would be irrelevant to the sales and marketing question. If there’s a customer ready to move in, “Hallelujah.” Who cares if they come from far or near?
Some residents move across the country to be near their children or grandchildren. Other residents move for climate. Some residents move across the country to find a CCRC that they trust, and that they believe will continue to be trustworthy for the rest of their lives. There are many individual reasons why prospects choose one CCRC over another.
Trust Is Central
Trust is becoming increasingly critical for CCRC success, due to adverse press coverage that took root during the COVID pandemic. Influenced by horror stories, many prospects are wary. Interestingly, that wariness includes some potential prospects who serve on CCRC boards and who might themselves thrive in a resident-centered CCRC.
In a recent article, Steve Moran listed three questions that CCRC management might use for a self-examination. Those questions are: “What problem do you solve? What makes you better than your competitors? How do you create value?” We might add to that, “How can a resident trust that your CCRC will be stable for the rest of the resident’s life?”
If a CCRC has top-notch answers to these questions, and if it has the marketing savvy to tell its story, then occupancy should bend upward. Of course, while a website is central for getting the story right, barriers to entrance should be swept away. What happens if a prospect shows up on a Sunday? Do your sales staff like to listen, or are they chatterers? Is it as easy for prospects as buying from Amazon, or is it as painful as buying a car?
Bottom line, the product and the experience matter more than whether the prospect is near or distant.
