Research tool can make big impact on development plans for operators
By Jeff Shaw
Managing Editor
One of the defining questions in marketing is: “What do your customers want?” While some seniors housing operators try to sort out the answer on their own, many turn to the tried-and-true practice of running focus groups.
Focus groups enable current and prospective residents — as well as their families — to speak and react directly to the operators, providing insights that can’t be matched by a discussion in a conference room.
“It’s one thing to have a development team sit in a room and decide what they think seniors want and will pay for,” says Rob Love, president of seniors housing marketing firm Love & Company. “But it’s another thing entirely to actually ask seniors, and see how they react to plans and pricing.”
Why run focus groups?
There are a wide variety of functional uses for focus groups, according to Janis Ehlers, president of seniors housing marketing firm The Ehlers Group. Approximately 25 percent of the Ft. Lauderdale, Fla.-based company’s business involves conducting focus groups for seniors housing clients.
“We’ll use it for communities that are having problems — to find what they’re doing right, what they’re doing wrong and what they can improve,” says Ehlers. “It’s also used for new communities that are just starting and want feedback on their services, planning and positioning to better understand a specific market. Lastly, it’s proven very valuable in getting feedback from existing residents and their adult children.”
For focus groups during a project’s development, potential residents can help adjust anything from a floor plan to programming to building style. Focus groups can also help generate buzz and interest in an upcoming project because “people love being in the inner circle and hearing first about a new community,” says Ehlers.
GlynnDevins, a widely recognized marketing firm in the seniors housing industry, suggests each community’s individual brand should be based on input from focus groups. Hearing from the local residents will help establish what those residents want in a seniors housing community.
“It helps us get a feel for the people and what it means to live there,” says Molly White, director of strategic planning for Overland Park, Kan.-based GlynnDevins. “Brand strategy is at the core of what we do with focus groups; that brand is rooted in research, not opinion.”
For existing properties, focus groups can even give owners new insight about their own communities, revealing points of difference that can be used for marketing. People often start their search for seniors housing based on what they need — especially in terms of a plan for those future “what-ifs,” White says, but what makes a resident choose a specific community are those small points of difference.
“Whether it’s new or 50 years old, in Kentucky or Chicago, the core reasons people move into seniors housing are the same,” says White. “Focus groups allow you to go deeper and deeper, which is when you find out what makes a community unique.”
“Some organizations think they already know what people think about them,” she continues. “They assume they know all the answers, so they’re hesitant to spend the money on focus groups. But it’s really valuable to hear what people are saying beyond the walls. You have to hear it firsthand.”
The purpose extends beyond gathering knowledge, however. Focus groups can save a community significant money in the long run, according to Rob Adams, partner and vice president at Richmond, Va.-based research and marketing firm Brooks Adams Research.
“Focus groups help us understand many different things for our communities,” says Adams. “Many times they help save dollars from one of our clients going down a wrong path, pricing incorrectly or rolling out a bad product.”
Create real, positive changes
To put it another way, focus groups add a qualitative perspective to support the quantitative data that smart developers and operators should already be mining, says Jay Hibbard, president of Bluespire Senior Living, a Minneapolis-based seniors housing marketing firm.
Hibbard cites the Village at Crystal Spring, a continuing care retirement community being planned in Annapolis, Md., as an example. The community’s architect originally intended to include balconies in some units, only to find out through focus groups that outdoor space on upper floors was extremely important to potential residents. The architect was able to adjust the design to provide all units with balconies before any major costs were incurred.
Originally the community was slated to focus on entrance-fee, life care contracts. But as a result of focus groups, the developer learned that many residents in the community had long-term care insurance. They weren’t interested in pre-paying for future services that insurance was already prepared to cover.
“Having a less expensive contract that allowed residents to cover healthcare costs with long-term care insurance was very important to the prospective residents,” says Hibbard. “That was confirmed by the focus groups.”
The Palace Group, a luxury seniors housing developer of eight communities in South Florida, ended up making an extreme change due to insights gained from focus group discussions presided over by The Ehlers Group.
Palace was developing an independent living community in Weston, Fla., a Miami suburb situated along Everglades National Park. Upon further review, however, the market wasn’t willing to support an independent living community. Despite sound market fundamentals, area residents were more interested in a 55-plus community.
Planning was underway, but not construction, so Palace was able to change the community to be a 55-plus and better suit the market.
“We did a series of focus groups — four or five of them — because it was such a significant change,” says Adam Rosenblum, vice president of marketing and sales for Palace. “It was a huge change. Nobody wanted independent living there.”
Palace now conducts quarterly focus groups in each of its communities, and even uses direct quotes gleaned from those groups in marketing materials.
Love & Company, based in Frederick, Md., uses focus groups on “100 percent of our projects that are expansions or startup communities,” according to founder Rob Love. One Love & Company client in North Carolina showed early design ideas to potential residents, only to find that some floor plans could have been a total deal breaker for residents.
“The building was designed with a unique shape to maximize views of a wooded natural habitat,” says Love. “Some of the ways residences fit into the layout resulted in either limited light or a long, dark hallway in the unit. The feedback from the focus groups provided great insight on those challenges. We took a list back to the architects, and they just submitted a new building plan.”
One Love & Company client had to reduce entrance fees when focus group participants reacted angrily upon learning of the proposed pricing. The lower rates were achieved by shrinking the floor plans by approximately 150 square feet, which reduced the entrance fee by $40,000 to $45,000.
Developers can use focus groups to ensure their communities are at the proper price point, offer the right contract options or are building in the ideal locations. In some instances, clients of Brooks Adams opted to not build a new community after focus groups made clear that the product was not a good fit for the area.
The operator of The Glebe in Daleville, Va., a Brooks Adams client, was able to improve its dining program to better meet the needs of the market based on input from focus groups. The change reduced the community’s average move-in age, and the focus group members became prospective residents.
“When we started working with The Glebe, they were just coming out of a tough time. Today they’re sitting at their highest occupancy ever,” says Adams, referring to the operator. Indeed, the occupancy rate has risen from nearly 70 percent to 98 percent. “Our focus groups were designed to really listen to the customer, which they would admit they haven’t always done over the years.”
In another example, a client of Adams discovered through focus groups that area residents weren’t aware that the facility in question even existed. A brand refresh coupled with an advertising campaign increased market awareness from 2 percent to 32 percent.
Several of the company’s clients have also expanded their contract options based on focus group feedback. Additionally, focus groups persuaded one Bluespire client to change its name and branding from Appalachian Christian Village to Cornerstone Village. After the rebranding, new leads doubled from the previous year.
Case Study: Virginia Baptist Homes
Virginia Baptist Homes was searching for a name that held onto the company’s faith-based roots while feeling less exclusionary to those who are not Baptists. The company, a client of Brooks Adams, operates four seniors housing communities in Virginia, including The Glebe.
The nine-month rebranding project included focus groups of residents, their families, front-line staff, the company’s board of directors and community members. The company settled on LifeSpire of Virginia for the new name.
Focus groups during the name change process revealed only 7 percent of residents cared if “Baptist” was included in the name. Many cared that it was faith-based, but denomination was not an issue. When designing the branding for the new name, a lot of research went into whether to put a cross on top of the church spire that would serve as the company’s new logo. In the end, the cross was left out.
The naming process helped bring the company closer to its residents and was so informative that focus groups soon became a daily routine.
All marketing projects receive input from residents via focus groups, from new bus designs to the new website to expansion plans at one of the communities. At one LifeSpire Community, enclosed walkways were added between the buildings so that residents didn’t have to wear coats in cold weather.
“We met with people considering a move to Lakewood, and found out our competitors were using [the lack of enclosed walkways] to sell against us,” says Peter Robinson, LifeSpire’s vice president of marketing and public relations. “We knew it was an issue, but we learned just how big an issue it was.”
Although the focus groups resulted in some front-end extra work, the success of the upcoming expansion is paying off. The project is adding 64 independent living units, and 55 were pre-sold within two weeks of LifeSpire presenting the plans to the community. Now there is a waiting list of 130 people.
LifeSpire was so satisfied with the results of the name change that it now uses focus groups for nearly every marketing campaign.
“We use focus groups daily in every community,” says Jonathan Cook, the company’s president and CEO. “We’re constantly asking our residents what they like or what they don’t like. We’ll even ask when during the day they’d like to eat.”