Last modified on August 24th, 2023
By Matthew Kaddatz
With 15 million single-family rental units in the United States and demand for single-family rentals at an all-time high, property management businesses are uniquely positioned to grow and capitalize on current market trends. In fact, according to the 2023 AppFolio Property Manager Benchmark Report, single-family home rental management businesses are nearly twice as likely as multifamily organizations to view adding new units to their portfolio as one of their greatest opportunities.
However, to acquire rental owners and scale sustainably, you need to identify and understand who your ideal customer is and how to market your business effectively. Below, I’ll detail some ways you can dial in your target audience and differentiate your business to attract the right owners.
This article was originally published in 2023 August edition of the NARPM Residential Resources Magazine. It is part one of a three-part series.
Engage with your ideal audience
Before deploying marketing tactics to acquire new owners, you must identify your ideal customer profile (ICP). An ICP is a short overview that articulates the exact type of owner you want to target. One of the biggest mistakes I made when I had a property management business was that I thought that if the owner came to me with a property for rent, I should sign them up. This is a very common mistake many operators make. However, taking on an owner that isn’t the right fit for your business can lead to added challenges and faster churn. Clarifying which owners are right for your business up front will help you grow faster and avoid cutting ties later.
The first step you need to take to uncover your ICP is to decide what you want to offer and how you plan to engage with owners. Here are some questions you can ask yourself to get started:
- What qualities make them ideal for you? What kinds of properties do they have? Where are they located? What do they need help with?
- What are their major pain points? What are they struggling to do on their own? Where are they wasting time and money?
- Why are you the right choice for them? What do you offer? Where are you located? What experience do you have?
- What differentiates you from competitors? What do you offer that they don’t? How competitively are you priced? How can you help them get ahead and maximize their revenue?
- How can you communicate those differentiators? How do you position yourself? What messaging have you put together? What spaces are you interacting with prospects in?
- How and where do you reach these people? What events are they going to? What sort of advertising are you doing? Where is your online presence the largest?
When answering these questions, it’s important to be clear and exclusive. The end goal is to find your best customers, not just okay customers.
Narrow down your scope of service
Once you have your ICP locked in, you need to figure out how you will market your business to them effectively. This includes what you will and won’t offer owners. When outlining this, here are a few things to consider:
- What things are you and your team good at?
- What are quick wins that are minimal effort but high reward?
- What do your competitors not offer?
- What are your team’s weaknesses?
- What things can you not do?
- What are the legal limitations that are specific to your state?
Standardize processes for scalability
If your processes are inconsistent, it will be nearly impossible to meet owners’ needs and provide a great experience, which can open your business to potential customer relationship issues, inefficiencies, and increased churn. Not to mention, it will be harder to scale sustainably over time. Before you do anything, I urge you to look closely at your workflows, standardize everything you can, and leverage technology to keep your processes and people aligned. Here are some things to consider standardizing:
- Contracts: Make sure each and every contract is as similar as possible. Don’t remove sections or add details that aren’t part of what you normally do.
- Workflows: For routine tasks like carrying out preventive maintenance or generating owner packets, make sure every team member is following the same steps every time. Property management software with customizable workflows can allow you to create consistent, repeatable processes across your workflows.
- Manual tasks: Tedious, repetitive tasks like entering invoices can be automated to minimize errors and free teams up to focus on nurturing owner relationships.
Expand your ICP with personas
Once you’ve gotten comfortable with your ICP, narrowed your scope of service, and standardized your processes, you can expand your audience to serve more people. One way to do this is to create personas. Personas capture the traits of a specific type of customer. While your ICP will always be your base persona, it can be helpful to expand to adjacent personas to maximize your growth potential. Sometimes this can create different business units, policies, and procedures and add complexity, but it comes with the benefit of new customers and opportunities. For instance, if your ICP is mom-and-pop investors, you could expand by creating a persona for institutional investors or for a different metro area.
By putting the strategies I shared above to good use, you can attract the right rental owners, stand out from your competitors, and tap into new opportunities to scale your business effectively. If you want to learn more about growing your business, download our free guide below. And stay tuned for the second part of this three-part series next month.