As the multifamily landscape continues to change with more supply coming online and increasing competition for renters, operators find themselves needing to focus even more on occupancy and retention efforts.

The industry has seen a shift towards delivering resident convenience and experience through technology. Smart home devices, resident apps, improved Wifi connectivity and even package lockers or direct-to-door delivery services have created a well-rounded living experience. But is there an even simpler way to continue improving the resident experience, increasing resident satisfaction and protecting occupancy.

Building Loyalty
Airline, hospitality and retail industries have proven that people like to be acknowledged and rewarded for their actions. It is human nature. According to Statista, seven out of 10 U.S. shoppers considered loyalty programs important to keep them connected to their favorite brands. They went on to report consumer shopping decisions are impacted when they feel that their loyalty is valued and appreciated through discounts and rewards.

In fact, 60% of consumers enrolled in a rewards program say they have more positive experiences with a brand because they believe their connection goes beyond the transactional. Furthermore, 72% of consumers consider rewards programs to be a part of their relationship with a company, highlighting the fact that rewards beget loyalty.

When residents feel they have an ongoing, good relationship with on-site associates, combined with being rewarded for positive behaviors like paying rent earlier, they feel a deeper connection and are more likely to renew year after year.

Establishing brand loyalty equates to long-term occupancy in multifamily. Reward programs are a key piece to building that loyalty by further enhancing the resident experience. The most effective rewards programs connect resident behavior with business goals and strike the balance between customer service and property performance. Reward programs that incentivize behaviors such as on-time rent payments, referrals and lease renewals can have a positive impact on your bottom line, while simultaneously boosting resident happiness.

Benefits Operators Can Actually Use
The average turnover in multifamily is close to 50% each year; and vacancy is becoming more costly than ever. When you consider the rising costs of marketing apartment homes in a tight competitive landscape, operators can spend between $1,000 to $5,000 per apartment home to fill that vacancy. From cleaning a unit and making any necessary repairs to advertising it and paying the utilities while it sits empty, vacancy costs add up quickly and significantly.

Rewards motivate residents to continue engaging in business-aligned, positive behavior, and a points-based cash-back program makes them happy to pay rent or refer someone to a community. When residents are happy, they will let others know either by way of an online review or word of mouth.

Additionally, data helps operators pinpoint which rewards residents prefer most and which ones work best to entice residents to stay at a community. Moreover, a rewards program encourages resident advocacy and community referrals by offering points for each referral made. It also costs significantly less to retain existing occupants rather than turning an apartment home for a new move-in, freeing up funds for community upgrades that enhance resident satisfaction.

He's Happy, She's Happy, We're All Happy
The benefits to operators also trickle down to the residents. Knowing which rewards produce more positive behavior and increase resident satisfaction serves all stakeholders well. Residents find value in varying rewards, but points-based cash back incentives are universally appreciated. If a different reward seems to appeal more at a particular community, operators can modify the program to better optimize renewals and other positive resident behaviors.

The overarching goal of a resident reward program is to keep renters happy and content with their current living situation. Such initiatives elevate resident engagement, increase happiness and incentivize renewals–boosting your NOI.