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An apartment management group, Horizon Group Management, filed a lawsuit against a former resident for the following tweet:

“Who said sleeping in a moldy apartment was bad for you? Horizon realty thinks it’s okay.”

I agree that we should be liable for our actions on and offline.  If consumers maliciously and falsely make claims against a business establishment that adversely affects his/her operations, the consumer should be liable.   However, we’ve seen this happen in other sectors and almost every time, it would have been better for the business to reach out to the consumer instead of filing a lawsuit.

More information can be found at:

This past week, I took a trip to Costa Rica with a few friends including Rahmin Sarabi, founder of unclasses.com, James Gross, VP at Federated Media, and Matt Jessell, Stategic Programs Manager at Federated Media.

With collectively over 15 years of web experience, most of our conversations were centered around how the web is changing media, consumer behavior, and our daily interaction - typical for a group of web guys on a vacation. Sorry, no bikini girls taking body shot stories here.

But in the context of a third-world country, heavily influenced by the US recession, the web seemed more relevant than ever.

It has become an equalizer; a channel of communication to connect and broadcast to anyone and everyone around a topic in real-time.

Before the leaving for the trip, James had connected with the founder of SurfingNosara.com, Erik Antonson. Erik has been experimenting with social media as a distribution and communication channel and wanted to meet with us to “get advice and talk strategy”.

What came next was a surprise. In an hour conversation with Erik, I realized that I had very little to offer. The specific strategies in using Twitter, Facebook Fan Pages, Blogs, Video, and other social media mediums are elementary. The technology is simple and the additional tools such as Twollow, TwitterHawk, Involver, etc can be found in online resource guides.

So how is it that a group of web dudes from San Francisco couldn’t give Erik a more concrete social media strategy?

Because he got it. Living in Costa Rica, thousands of miles from any technology hubs and in the middle of the jungle, he got it. He may not have the best SEO or SEM strategy, or may not be utilizing the best tools to scale his consumer engagement, but understood the foundation the social web was built on.

He knew to:

1) Focus on relevant and real-time content.

Erik posts regularly with interesting and engaging content. No automated content rss fed content from an api of twitter search with geotagged stories from ghost bloggers (I think I got most of the bs terms used). It’s real content from him and his crew.

2) Be authentic.

He’s not going to pretend to be a brand, or hide behind a logo. He is the founder, owner, the company, and a person you can ask questions and talk to.

3) Be passionate about what he is doing.

Erik is a realtor. But he actually cares about what he is doing, and it is easy to recognize that. It is apparent from in his posts, his videos, and the community he has built.

4) Use marketing channels as means to communicate, not sell.

He understood that these mediums are a means to communicate and engage around conversation. He actually cared about your experience, the relationship, and building an online community around Nosara. He makes it nontransactional. (Yes, he’s a realtor and yes, this is possible)

5) Make decisions as if he was 16.

He thinks about his life and his company as if he were a young, optimistic adolescent. He makes it fun, appreciates the process, and in the end, is doing more of what he enjoys. Why does this matter? Because making an extra dollar is not the end goal.

Again, the web has become as equalizer. Understanding the trends, tools, and fundamentals of the social web are no longer restrictive to those in the microcosm of San Francisco geekness. All too often we associate “living in San Francisco” with technological know-how. Sure, the entire globe isn’t using FourSquares or Vark, but Erik started with a solid foundation of focusing on content, his relationships, and his passion; and with these principles in mind, he is going to crush it.

Find Erik at SurfingNosara.com.

The recent months, the hot topic in the multi-family housing industry has been social media. There are those who understand it, those who are experimenting with it, and those who deny it’s existence.

As we gear up for the NAA educational conference and the social media panel with Tony Hsieh, Jeremiah Owyang, and Pete Flint, I have noticed that there are some people that have never heard of large companies like Zappos.com.

So to reward those who know what Zappos.com is and want to see Tony, Jeremiah, and Pete discuss Social Media, but cannot afford tickets, NAA has graciously sponsored a contest to give away 1 FREE NAA CONFERENCE TICKET and 50% off 1 NAA CONFERENCE TICKET.

Enter the contest and see if you are a social media guru.

Lots of momentum in the valley around Eric Reis’ Lean Startup.  Though I find his advice particularly valuable to startups, I think there are other applications to the general principles.  If you haven’t seen it, here is his presentation from the Web 2.0 Conference.

 
In our industry, the traditional methodology of developing and implementing a new idea or service seems to stifle creativity.  At a typical property management group, the risk-profile is perceived to be very high.  Further compounding the problem, traditional mediums are viewed as efficient “enough”.

I’m not recommending you spend hours a day tracking and measuring leads, but putting some simple processes in place will help you identify which leads are converting from which sources.  Though the general goal is to drive the most leads possible, maybe it should be to drive the most qualified leads possible.  

3)  Reduce total time through the loop.

The general idea is the getting through the feedback loop as quickly as possible.  The faster you are at identifying what renters want or how to interact with renters, the more branding and lead generations opportunities you will have.  

I think a lean startup is about testing a variety of hypotheses, using feedback and data to identify consumers’ needs, and being able to quickly change strategy and iterate again.  This may be a bit of a stretch for property management groups and I know I am oversimplifying things, but I think some lessons can be learned and applied.  What do you think?

NAA welcomes several of social media’s best minds to discuss how this marketing trend applies to customer service and retention at a Thought Leaders session at the 2009 NAA Education Conference & Exposition on June 27 in Las Vegas.
By Eric Wu

All the current talk is about social media - how Twitter is taking over e-mail, how Facebook has more users than most countries have citizens, and how engineered virality can replace a marketing budget. With all the chatter, one might think that social media should be a substitute for advertising, a reason to eliminate a company’s marketing staff, and even cure cancer.

All too often, abstract concepts in social media marketing and communication are not concretely defined or measured. The result is the perception of a far-fetched land of geeks getting together and somehow magically altering business operations, marketing strategies and branding.

On June 27, 2009, at the NAA Education Conference & Exposition in Las Vegas, the “Thought Leaders in Social Media” panel aims to provide some experiences and relevant insight into how to use the social web. As a precursor, let’s introduce the panel and take a look at how these individuals have applied social media strategies to increase brand recognition, retention and revenue.

Panelist #1 – Tony Hsieh, CEO of Zappos.com

Tony Hsieh has grown Zappos.com from $1.6 million in 2000 to $840 million in 2007, a measly 525,000 percent increase.

How was Tony able to change a company from a little over $1 million in revenue to almost $1 billion in revenue?

If you ask Tony, he’ll say, “customer support.” For most people, these words act as reminders to answer phone calls and please the customer. And, granted, Zappos does both of those brilliantly. However, Zappos has consistently adopted social media as part of its customer support strategy to engage and listen to customers.

“We actually take a lot of the money that we normally would have spent on paid advertising and put it back into customer experience,” says Tony. “We’ve always stuck with customer service, even when it was not a sexy thing to do.”

Zappos shortens the engagement loop with the entire organization by being very active on Twitter. Tony has more than 350,000 followers, and more than 400 of his employees are using Twitter.

For Tony, growing the business has not just been about answering phone calls, but about building a brand around the principles of engagement, creativity and a laser focus on fulfilling customer needs. These initiatives have resulted in 7.4 million total customers, 75 percent of purchases coming from returning customers and repeat customers ordering more than 2.5 times every 12 months. Talk about retention.

Panelist #2 – Jeremiah Owyang, Sr. Analyst at Forrester Research

Jeremiah Owyang is a senior analyst at Forrest Research and a leading expert on social computing, social media and interactive marketing. Jeremiah’s blog was ranked 19th by Advertising Age, he has consulted for large brands such as Hitachi Data Systems, and he is a speaker and educator at many conferences such as Web 2.0 Expo, SXSW and CES.

In a recent study titled, Social Media Playtime Is Over, Jeremiah writes:

The recession has put more pressure on interactive marketers to deliver measurable results. While many marketing budgets are being cinched, more than 50 percent of interactive marketers say they will increase their spending on social marketing. Why? These inexpensive tools can quickly get marketing messages out through interactive discussion and rapid word of mouth and, properly managed, can deliver measurable results. But in this downturn, interactive marketers must move beyond experimentation by making social applications a permanent part of marketing, measuring and demonstrating their value, and integrating them into marketing efforts.

As a part of the study, Jeremiah found that 53 percent of marketers are determined to increase their social media budgets and 42 percent will keep budgets the same, a total of 95 percent of marketers bullish on social media marketing. Even though these budgets are small (three-quarters are less than $100,000), Jeremiah recommends that marketers do not approach social media marketing as an experiment. “Remember, the most expensive cost isn’t the tools, it is the soft costs–strategy, education, process, roles and measurement,” he says.

Jeremiah continues to provide empirical data and demonstrate why social media outlets can be an integral part of marketing and distribution. His message is spot-on; it is not just about being there, but it is about having a strategy and goals for the engagement.

Panelist #3 – Pete Flint, Founder of Trulia.com

Flint founded Trulia.com in 2005 and it now is one of largest and fastest growing real estate Web sites in the United States. Trulia.com has over 5 million unique visitors a month and has raised more than $33 million in funding.

Trulia has been able to bridge the gap between buyers and real estate professionals by building a community called Trulia Voices. Some stats include:

• Visits to Trulia Voices increased 146 percent year over year
• The volume of question and answer activity in Trulia Voices Q&A increased 114 percent year over year
• Real estate professionals’ answer volume increased 96 percent year over year
• Consumer questions increased 181 percent year over year

How has Trulia engaged both millions of home buyers and hundreds of thousands real estate agents?

Again, the answer seems to be centered on the engagement of the customer. Heather Fernandez, Vice President of Marketing of Trulia, says, “Consumers are looking for guidance and education and are relying on our pool of more than 200,000 real estate professionals for advice and insight.”

With multifamily housing traditionally closely tied to the real estate sector, Trulia is a relevant example of how user-generated content can change the flow of communication to consumers.

Moderator – Eric Wu, Co-Founder of RentWiki.com

I’m a 26-year-old entrepreneur and co-founder of RentWiki.com, a socially-driven rental search that connects renters with peer advice. I’ve spoken at conferences such as NMHC Technology, AIM Conference and the Harvard Business School Entrepreneurship Conference. In 2006, I was named one of BusinessWeek’s Top 25 Entrepreneurs Under 25.

Conclusion
Having a Twitter account, a Facebook fan page and a viral YouTube video will not cure cancer, but they can and will affect your bottom line. The underlying message is not about usage or presence. It is about having a consistent strategy to engage consumers, listen to customers and focus on their needs. As Jeremiah puts it, “Fish where the fish are.”

Eric Wu is Co-Founder of Rentwiki.com. He can be reached at eric@rentwiki.com or 415/640-4970. The “Thought Leaders on Social Media” session will be presented 10 a.m. to 11 a.m. on Saturday, June 27 in the Mandalay Bay’s Lagoon Ballroom as part of the 2009 NAA Education Conference & Exposition.

I wanted to write a followup post to take a closer look on how Twitter is affecting specific markets. With our recent Twitter integration, we’re still figuring out the impact of how local conversations affect the renters decision-making process.  Let’s take a closer look on how it is affecting the stock market and traders, wholesalers of consumer goods, and the rental market.

Stock Markets

Stocktwits.com, a San Francisco based company, specializes in tracking conversations around stocks to give investors insight on stocks. Funded by veteran Wall Street investors, Stocktwits is a simple tool that combines twitter with stock charts. But the magic is in the Twitter conversations and its surprising ability to gauge public opinion.

According to the BusinessWeek titled, “StockTwits May Change How You Trade”, the transparency of a Twitter and the recorded track record allows traders to identify who to follow and who not to follow.

Just like the credibility and objectivity crisis of sell-side analysts in 2001 led to a boom in financial blogs like Seeking Alpha and Barry Ritholtz’s The Big Picture, the credibility crisis afflicting mainstream financial media today has led to a boom in investor social networks. Traders and investors alike have come to view these platforms as trusted filters that help them make more informed decisions because they can discuss and interpret the news with their peers. At the same time, unlike financial bloggers who make their mark by writing commentary and opinion pieces, StockTwits users are essentially creating a trading record that’s scrutinized on a daily basis. A trader’s reputation is always on the line, and that’s the beauty of the financial social Web—it forces people to be accountable.

Wholesalers of Goods

Dell, over the past year and a half, has sold over $1 million in personal computers on Twitter. People sign up to receive Dell alerts, and are sent messages when discounted products are available. Dell turned a simple chat tool into a distribution channel.  According to InternetNews:

Less altruistically, some businesses have discovered that Twitter is an effective way of communicating with consumers. Dell (NASDAQ: DELL) says Twitter has produced $1 million in revenue over the past year and a half through sale alerts. People who sign up to follow Dell on Twitter receive messages when discounted products are available the company’s Home Outlet Store. They can click over to purchase the product or forward the information to others.

Also cited as how Jet Blue is announcing discounts on Twitter and gaining some traction with consumers.

Rental Market

We give people searching for a place to live real advice from renters living in that area. Via Twitter, we feel potential renters can get a sense for the neighborhood vibe, types of people living in the area, and identify locals to ask for feedback.

Again, as stated on a previous post, Twitter seems to be hosting conversations that may prove to be very relevant to multiple industries, including the rental search.  With Twitter, we are expanding the conversation beyond just our site and into the real-time social web.

Here is a slideshow created by a Twitter enthusiast:

My conclusion, though Twitter may not be an end all source for stock advice, shopping, or rentals, it suppliments the experience with information, data, and consumer views in real-time.  Once a place for geeks to talk about Technology, Twitter showing its versatility and proving it can be used for more than just answering the question, “What are you doing?”.

Bill Gurley recently had a great post about how TenCent has been able to monetize through the use of digital goods and games.

For those that don’t know, TenCent is the owner of the leading IM franchise in China – a product known affectionately as “QQ”. TenCent was founded in 1998, has 355 million users, US$1.2B in annual revenues, and a US$11.2B market capitalization. The stock chart for the past 5 years is included in the adjacent graphic. The two primary drivers of revenue for TenCent are digital items and casual game packages and upgrades. Advertising, which doesn’t work well on U.S. products like IM, doesn’t work well in China either. Advertising revenues for TenCent represent only 12% of total revenues. Recently, I asked a leading Internet analyst which company in China is best positioned above all others? He quickly replied “TenCent”.

Facebook already has very large succesful third-party games and could build some killer ones internally. Additionally, virtual gifts are approximately 1/5 of Facebooks revenue. Surprisingly, an estimated $50 to $60 million is made from Facebook virtual gifts.

Though I agree that the digital goods and games model will undoubly be extremely profitable if executed correctly, here is my easy and fast recommended revenue model for Twitter and Facebook.

1) I’ve been saying for years that our all aspects of our offline lives are migrating online. Our conversations, our interactions, and our thoughts are being held and recorded online.

2) We are already recommending books, restaurants, electronics, websites, and all sorts of consumer goods online.

However, these mentioned on Facebook and Twitter are not hyperlinked. What if Twitter and Facebook hyperlinked mentioned of goods or services relevant to the conversation? For instance, if a friend recommends a book on Twitter, it would link to Amazon so I could purchase it or read a summary/reviews of it. Think Zemanta.com or Apture.com for online conversations.

Would I pay for a link to a neighborhood or apartment in a conversation on Twitter or Facebook? I am cheap and I would pay boatloads for that.

So similar to the Google model that brings back relevant advertisements based on key terms, advertisers could pay for links in the text of conversations as long as it is extremely relevant. If I mention Apple Macbooks in a conversation, the “Apple” text is linked to Apple’s homepage. No doubt there is downside to the user experience if it is not executed correctly, but I think a few relevant links here and there would actually be helpful.

On that note, “I’m going to Barnes and Noble right now to attempt to buy an advanced CSS book.”

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“Do not ignore ApartmentRatings.com.”  ”Respond to residents who complain.”  ”Engage and start a conversation.”

There has been many great articles about the importance of engaging in conversation and being actively involved in social media.  In a recent blog post, Charity Hisle says, “This is the perfect opportunity to set things right, make necessary changes or state they’ve been made.”  Eric Brown of Urbane Apartments says, “The shift is pretty simple, we started and work at participating in the Conversation. That’s it, while it sounds pretty simple, and it is, it seems to be pretty hard for apartment communities, otherwise they would be doing it.”  Both Charity and Eric are thought leaders, paving the way for a long overdue entrance into social media, and reacting to trends in consumer behavior.  At it’s core, the message is clear… JOIN THE CONVERSATION.

But that seems like a general statement in an even broader and vague social media strategy.  So similar to the Airforce’s response to social media, here are some strategies on how to handle 4 online personality types.

1)  Flamer, Troll

This person is looking to insult, incite, and personally attack others.  The conversation is usually fairly hostile and he/she may be flaming for acknowledgment, entertainment, or to get a reaction from you.  One of the distinguishing factors is their anonymity.

Example: “The property manager sucks more than all of Nicolas Cage’s movies combined.  The management sucks so bad, life on earth stops.  They are so bad, I’d rather sleep outside in a box.”

Option 1:  ” I apologize that you had a bad experience with our property.  We are doing our best to improve our management and property so that future residents do not have a similar experience.  Most importantly, we are working on listening to past residents and I would like to get more feedback from you.  Please email me at feedback@gmail.com.  Nicolas Cage is horrible so we have some work ahead of us.  Thanks for being so honest!”

Option 2:  Do not respond or acknowledge their existence.  In fact, often times, they will use it to rebuttal everything you could possibly say.

Do not be surprised if the response goes something like this, “No F***ing way would I even give you advice, unless it’s a virus.  Thanks for being so stupid!” In which case, the rest of the community just discredited his original post.  Many people do recommend not responding to flamers and trolls.

2) Critics

This group makes up as much as 25% of internet users.  Though some of these people fall into the flamers/trolls, they are more constructive and sometimes will be transparent with their identity.

Example: “This apartment is below average.  Though it is in a great location, the property is old, run-down, and has some deferred maintenance.  Parking is difficult, but on the bright side, it’s close to public transport so you may not need a car.  If you can spend a bit more, there are better options in the area.”

Option 1:  “That is false.  We have plenty of parking, and our building is in top-notch shape.”

Do not do one sided rebuttals.  If so, expect another rebuttal to come from the users who posted this saying something to the effect of, “The manager is lying, parking sucks, etc.”

Option 2: “Thank you for the constructive feedback.  We purchased the property from the previous owner and have also noticed some deferred maintenance.  We’ve made some improvements with the parking situation and have had some positive feedback from residents.  Also, we’re attempting to compile a complete list and prioritize which ones are most important to residents.  I was wondering if you could take 5 minutes and add to our maintenance, www.uservoice.com, what you would like to see improved .  Let me know if you have any questions!”

Uservoice.com, getsatisfaction.com, etc. all work very well with compiling feedback and building a community around the feedback.  The key here is to convey that you are trying to make improvements.

3)  Spectators, lurkers

These are people that are not actively submitting content, but rather reading and consuming the information.  This is typically the largest group of users, with some estimates north of 80%.   You want to connect with them.

The best way is to actively seek feedback.  Post a feedback button in your signature.  Email all current and past residents asking for feedback and advice.  Feedback does not have to be about the property, but maybe something like, “a resident asked me yesterday the best bar in the area.  Does anyone have any recommendations?” Establish some type of rapport before you ask for future help.  Most importantly, this allows you to identify who may potentially be an evangeslist.

4)   Evangelist

This is the most important group to engage because they are the people who will spread positive WOM.  With minimal reward or recognition, they will most likely continue to evangelize on your behalf.

Example: “This apartment is in a great location, well maintained, and management is responsive and responsible.”

Option 1: Post online, “Thank you for your kinds words.  We have made a conscious effort to listen to our residents and make improvements according to feedback.  I’m glad to hear the time and effort is paying off.  We’re always looking for ways to be better, so please email me any additional thoughts you have.”

Option 2: Email the resident directly with something to the affect of, “Thank you for the kind words and I am happy you enjoy living here.  We’re always looking for ways to be better, so please email me any additional thoughts you have.   Additionally, we’re actually compiling for testimonials to post on our website.  I was wondering if we could use your review on our website.  I’ll send you a $10 itunes gift card as a thank you.”

Option 3: After doing both 1 & 2, “Hi, we’ve noticed that someone wrote an unfair review about us on _____.com.  I was wondering if you would share your experience.”

Use all three options!

Eric Brown, Mark Juleen, Charity Hisle, Mike Brewer, and many others are right.  Use blogs, twitter, facebook, ning, yelp, yahoo answers, rentwiki, etc.  It’s time to start engaging with users, but in the correct way.  And most importantly, be yourself.

What do you think?

Ps. Trying to get together ideas for the apartment industry and then track results.  Help out at http://socialmediaideas.pbwiki.com.

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We’re witnessing deflation and rising unemployment,resulting in trailing decreases in consumer spending.  The movement towards thrift spendinghas impacted the housing market, and I am noticing a couple of obvious trends.

1)  Empty nestsare being filled

Renting is the largest living expense and consumers aremoving home to reduce that cost. Manyrecent college graduates, young professions, and the unemployed will be forcedto move home.  

2)  Per unitoccupancy is increasing

Before the recession, a typical 4 bedroom unit wouldhouse 2 or 3 occupants.  Now,residents are forgoing the luxury and privacy of living alone, and moving inwith roommates.  We will continueto see a trend of more one bedrooms vacant compared to cheaper four bedroom counterparts.

3)  Influx ofsecond homes becoming rentals 

As downward pressure is placed on the pockets ofthe upper-middle class, many owning vacation homes will begin to seekadditional income via rent.  Withsome 6.6 million units classified as “second homes”, this will results in morerentals on the market.

4)  Risingvacancy, declining home purchasing

We’re seeing a positive correlationbetween the volume in home buyers and renters…And by positive correlation, keep in mind that I mean they are both decreasing.

What does this all mean?  Simply put, increases in vacancy and decreases in rental rates.  It does not mean that the rental sector will resemble theprice sensitivity of the airline industry, but we will see a push towards moreaffordable housing options.  Anecdotally speaking, I’ve seen my properties decrease 10% in rental rates yoy.

How do you combat the current economic crisis?  Unfortunately, I do not know the exactanswer, but the first step is to recognize that profits equal revenue minus costs.  It will be increasinglymore difficult to increase revenue as the downtown continues, but you can takeadvantage by reducing costs.  Again, we’re seeing deflation, so renegotiate contracts with your vendors, maintenance companies, etc.  Reductionsin operating costs, advertising costs, staffing costs, turnover, and other line items can help you stay afloat. 

What other trends are you seeing?