Bob Cross AptRevenue Conference Keynote Recap

The first annual Apartment Revenue Management Conference is a wrap and we are proud to say it was an overwhelming success. A special thanks to our sponsors and the industry leaders who shared their knowledge and insights into successful revenue management practices.

Over the course of the next few days, we will be utilizing this blog to post recaps from the various sessions presented at the conference. So be sure to check back often and we would love to hear your feedback on the sessions and what you take away from them.

Bob Cross Keynote Presentation

Bob Cross, author of the best-selling book Revenue Management: Hard Core Tactics for Market Domination and CEO of Revenue Analytics delivered the keynote presentation at the first annual Apartment Revenue Management Conference, and he did not disappoint. The audience was engaged, laughing, nodding their heads in agreement with his insights and feverishly taking notes as to not miss anything from the “guru of revenue management.” It was truly an honor to have him attend the conference as well as share his expertise in yield optimization. And let’s not forget Bob’s willingness to spend more than an hour signing copies of his book for conference attendees.

For those who were not able to attend the conference and missed out on hearing Bob speak – here are some of the key concepts he discussed:

• The guru of revenue management never took a business or marketing class. Revenue management started as a common sense discussion with key business personnel including executives and members from the operations, marketing and sales departments.
• Don’t view a revenue management system as the solution. It is a life-long learning process.
• The biggest competitors to successful revenue management are not the communities down the road but ignorance and inertia in the process.
• Don’t shut off your brain when engaging in revenue management, combine people and technology to generate the most success.
• Effective revenue management is resident-centric, however, a prospect should never know more about the market than your leasing staff. Make sure your onsite leasing staff is educated about pricing, the competition, supply and demand and the value of your product.
• One of the most common misconceptions about revenue management is the idea “you are the one sticking it to the customers.” Revenue management is really about ensuring “everyone wins.” The customer gets the product they want at a price they are willing to pay with built in perceived value while the company receives the targeted revenue goal.
• Even companies like Southwest Airlines, who many think doesn’t practice revenue management because they are not charging extra for checking bags or change fees, really do practice revenue management. The company has simply adjusted the model so it works best for them.
• Finally, Pop-tarts will sustain life during a hurricane along with some beer and ice too. Bob referenced a survey conducted before the major hurricane season 2005. The survey was conducted to determine what people would purchase to prepare for the storm. Though the results showed consumers said they would purchase the essentials, water, batteries, canned food, the actual purchases were completely different.  Strawberry pop-tarts were the most purchased item. This survey is a prime example that customers say one thing but often do or buy another. They don’t know what they want or what they will do. You can’t rely on a customer’s word to drive your revenue.  Utilize supply and demand as the foundation for your revenue management practices.