The senior living industry is facing a major challenge: New construction is at a tipping point and analysts predict it will soon outpace new demand. This means lower occupancy rates are on the horizon.
How can providers optimize their sales process and compete in this tight market?
Does Sales Activity Matter?
Recently, we’ve been hearing a narrative from some senior living sales consultants who are challenging the traditional mindset. They told a Sales and Marketing Summit audience that data from their CRM users shows that traditional sales activities -- call outs, tours, etc. -- do not lead to better sales results. What does matter, in their analysis, is the time spent with each prospect. They recommend that rather than increasing activity to drive more sales, salespeople spend more time with fewer prospects.
At Enquire, we’ve been benchmarking senior living sales and marketing data since our inception. We have a very large set of sales activity data, collected from several thousand CRM users.
To investigate whether traditional sales activity matters, we analyzed data from a sample of CCRC, independent living, assisted living, and memory care communities. We found that not only is there a relationship between activity and sales, but that the relationship is very strong.
The graph below shows a regression analysis of activity versus sales.
- Activity = all touches (call outs, visits/tours, direct mail, email, etc.)
- Sales = distinct individual count of move ins or a commitment to move in
- R2 = 0.712892
- p < 0.0001
The results can leave no doubt that for senior living providers, there is a highly significant relationship between sales activity and sales.
To investigate this relationship further, we analyzed the relationship specifically between tours and sales. The chart below shows a regression analysis of tours versus sales. Again, the statistical significance is very high.
- R2 = 0.794401
- p < 0.0001
Conclusion: Sales Activity Matters...A Lot
Our conclusion is that focusing on time spent with prospective residents, while valuable and important, tells only half of the story.
Without a doubt, the more time salespeople spend getting to know prospects, addressing their individual needs, and offering creative follow-up, the better their results will be. But this doesn’t provide a holistic view of the buyer’s journey, and it certainly doesn’t mean that traditional sales activities are ineffective.
Our data consistently shows that communities with call centers book more tours. And not just by a little. Across every care level call centers outperform in-house sales people.
This is because of consistency and responsiveness. Call centers can capture more inquiries and make more touches. You could be the best tour scheduler in the world, but a call center will still book more tours. Even the best tour scheduler can’t answer every call -- and our data shows that capturing every call creates more opportunities to convert leads into sales.
Consistency and responsiveness are important because the number of contacts necessary to make a sale is going up. For independent living communities, the average number of touches is 19, only five of which are face-to-face.
Leads, inquiries, and tours are what attracts prospects to a community in the first place. These are the activities that fill the sales funnel, and providers must drive the maximum volume of leads into this funnel to give them the most opportunities to connect with qualified prospects.
For senior living providers anxious about the prospect of shrinking occupancy, the answer isn’t to have fewer leads in the funnel. The answer is to have more quality conversations with more leads. In our analysis, this is what drives more sales.
Download our 2015 Senior Living Sales and Marketing Benchmarking Report to learm more about senior living sales metrics.