Owner Occupied Episode 17 - Deep Dive into Digital Marketing with Special Guest: Mike Whaling

Welcome back, everyone. We are here today with Owner Occupied Episode 17. We've got a really special episode today. We have a guest, Mike Whaling of 30 Lines. 30 Lines is a digital marketing agency that specializes in multifamily property marketing. Mike Whaling started this company years ago, and he's grown it to a very respectable size. He specializes in helping rental property owners and property management companies market their larger multifamily properties, basically helping them fill it faster with better tenants. So we get into a really deep discussion on how exactly he does that, some custom software that 30 Lines has written which makes this process easier and more transparent. We learned a little bit about Mike's background and how he came to be involved with the rental housing industry and started and grew his marketing, his marketing company. And we also discuss some tactics and strategies, what Mike would do differently if he had to start over. The answer really surprised me. And, and we just really sort of get to the heart of some of the hottest topics in the multifamily marketing world today, including how can you be more effective with your ad spend if you're a property owner and you have a budget for filling vacancies? How can you most effectively utilize those dollars? So without further ado, let's get right into it.

Welcome to another episode of Owner Occupied with Peter Lohmann. We have a special guest today, Mike Whaling, and we're looking for a nice deep dive on digital marketing. Now that's such a big broad term. I do some of it in my business. I run a lot of ads on Facebook, YouTube, Google, Twitter. And so I'm looking forward to learning from, from Mike on some of this. But I think we're going to focus more because of Mike's niche and Peter's expertise in the rental property space. I'm curious to see how it works and what the land landscape looks like. Peter, you mind giving us a little overview of sort of what your digital engagement in the real estate world looks like today?

Yeah, absolutely. So, so our firm uses sort of the default rental listing platforms, you know, Zillow, HotPads, Trulia. So we sort of rely mostly on just the default syndications that come built in to most property management software. And I think that's typical for a scattered site property management company or a scattered site real estate investor who owns single-family rentals, duplexes, fourplexes, 10 units, stuff like that. Where Mike's expertise and his firm 30 Lines come in, if we were to buy, say, a 100-unit apartment building or a 250-unit apartment building at that scale, that particular building is going to have a marketing budget and a marketing strategy around it. And that is Mike's firm's area of expertise. That's what 30 Lines focuses on, if I'm, if I'm remembering correctly, Mike, is, hey, I own 1 building, 2 buildings, 10 buildings in this city, that city, and I need to, I need to lease these units. So I need to get in touch with my target demographic. Let them know who we are, where we are, what's great about our buildings, and, and basically fill those units. So it's, it's kind of like tangential to my world, but there's some overlap, and the space really interests me. And Mike in particular has a lot of really interesting and unique perspectives on what kind of the future of that whole world can look like. Does that make sense, Russell?

Yeah, that makes sense to me. Mike, why don't you— did Peter summarize it accurately, that distinction between the multi-site, scattered-site user and that sort of major significant property single?

Yeah, I think he did. It's funny, I actually think that there's— the two are starting to blend more than ever, especially as you start to see major institutional investments in, you know, single-family rentals. You're starting to see a little bit more of a blending of the strategies, but we definitely— he nailed it. And, you know, our expertise is typically in the larger properties, the larger property managers, and the larger owners. But there's a lot of concepts, a lot of things that overlap and apply to single-family rentals and smaller property managers. And there's actually a lot of ways where You know, the way that Peter does business can give him an advantage.

Yeah.

Well, Mike, I really appreciate you coming on the show today. I'm excited to dive into a few topics. I guess if you don't mind, Mike, just give us like a little background, maybe 2 minutes on who you are, where you came from, and how you get started with 30 Lines.

Yeah. So, I founded Thirty Lines in 2008. So, I've been doing this for a little while now, since the days of MySpace and things like that. But, you know, I started as a vendor to the multifamily industry. I was working for an engineering firm and, you know, that got me involved in an MHC, it got me involved in NAA, it got me involved at a national level with just understanding how people were handling their marketing at the time.. And what I saw really early on was where social media was going and where SEO was going, sort of search engine optimization, just being found in Google and other search engines. And I started blogging about it. I started moonlighting and just talking more about if you are running one of these communities and you want to be found based on where marketing is going and where the internet is going, here are some things Here's how to blog if you're a property manager, topics that you can write about. Here's what you can be doing on your social media. Here's what people actually use social media for. So let's make sure that we understand that if we're trying to use it as a channel to reach our prospective customers. From that, we've evolved into really a full-service agency where, you know, we've developed our own software called RentPress that is specific to the multifamily industry. We've seen a lot of gaps in where we can Phil. And, you know, we really have, have gained a deep understanding of consumer behavior and how people shop specifically for apartments and what that looks like in terms of how we need to align our clients' marketing to meet those people where they're at in the process. Yeah.

What was the name of that software?

Uh, it's called RentPress.

RentPress. And what is, what is What is it?

Um, just like, just like most of your listeners probably have a property management software platform that they use, um, we're developing a custom, custom-tailored multifamily apartment marketing platform. Um, it started off as, as a plugin for WordPress websites, an easy way for anybody to create, uh, floor plans and units and publish properties to a, to a simple WordPress site. We did that on purpose because we want to democratize that. We want to make it easy for anybody to create a beautiful website and offer all of the, you know, kind of the e-commerce capabilities of publishing pricing and availability and getting that into your, into your industry CRM. Beyond that though, we've now developed other extensions for RampPress, so we can push your pricing and availability to your Google Business listings. We can capture leads from a CRM and run retargeting ads in sync with where that customer's at in the customer journey. We do a lot of email marketing and email follow-up and marketing automation. So all of it's based off of the one singular platform, and we're really just looking for how do we take everything that's happening in multi— in property management software and build that bridge between property management software and what marketing looks like in 2021.

Wow. I can see why Peter was interested. Peter, why don't you pull that out a little bit?

Yeah. Well, we're going to bounce around a little bit today. I do want to dive into that a little more, but I'm curious, and I'm sure our listeners are too, can you give us a sense of the size of 30 Lines right now? Whatever you're comfortable with in terms of number of employees or Um, where, where is your position in, I guess, in the marketplace in terms of size?

Yeah, we're, we're small. We're a tiny boutique agency. We've got, uh, we're at 24 employees now. We'll probably hire another 5 by the end of the year. Um, so there's definitely some growth there.

Um, and you have clients nationwide, not just here in Ohio, of course?

Yep, we have clients, um, across the states and in Canada. Okay. Um, yep. But yeah, we're pretty small. We've been lucky over the past few years. We've seen a lot of growth and as a small business, bootstrapping the whole thing, keeping up with hiring and making sure that we are hiring and maintaining operations and maintaining consistency and maintaining culture is always a challenge. And Peter, I know that that might be somewhere where we wanna go with the conversation. You know, I know you take an interest in that kind of stuff. Yeah. But right now we are at, sorry, we're at about, in the RentPress platform, we have just under 1,200 properties nationwide. So that translates to somewhere about 300,000 units in RentPress. And then beyond that, we touch another 500,000 or 600,000 units that are, it's just our marketing agency side of the business that aren't in the software yet.

Yeah, that's incredible. That's, that's amazing scale. I mean, for reference, we manage 490 units. Now, of course, you're only dealing with the marketing side, but still, that's a lot, right?

One of my clients is the— one of my clients is the California Rental Housing Association. And we have somewhere around 520,000 units. And we're the largest rental housing association subnational scale in the country. And so that you're— that, I don't know, you self-described it as a minnow, but it sounds kind of whaley to me. It sounds pretty significant, but I hadn't heard of it. And so I'm curious, and not to steal your thunder there, Peter Lohmann, but where were you What's your— are you reaching out? Are you actively looking to grow that platform and get big now? Where are you in the phase of your business?

What are you looking to do? We are— I would say it took us a while to figure out where we wanted to focus. You know, we were generalists in terms of digital marketing for a long time, and it helped us figure out what we didn't want to do. You know, what are the things that we don't like to do and don't want to focus on?

What were some of those things that you decided not to pursue and based on experience?

The two biggest ones are social media and reputation management. Got it. Just because we believe that we're not the right people to execute those things for a property. And so we don't do daily social media management and we don't do responding to reviews. We have a lot of different ways that we can help, we can help properties generate more feedback and generate more positive reviews. There's all kinds of opportunities to create touchpoints to gauge feedback, but we don't believe that it's, that it's effective or that it's in service of the customer for a third party to provide canned responses to reviews. And the same thing with social media. If you look at where social media is going with, with TikTok, with all of the stories and fleets and all of the different ways that they're looking for content today. It's incredibly difficult to manage social media as a third party remotely and make it feel genuine or at all representative of what is actually happening at the property.

Yeah, it's becoming more and more personal, it seems to me. Like, people want to see and hear the face or the personality behind the business. They don't want to engage with ABC Company, you know, they want to engage with John Smith, the owner who started it, blah, blah, blah, his story. Yeah. So that must be a challenge with marketing a property because when you're marketing a business, you know, you have typically a founder or a CEO that can be sort of the face of that company and kind of be the touchpoint for customers when in certain market— in a lot of marketing, But when you have a property, you don't have that necessarily. So how do you approach that?

In some cases you don't. I think there are plenty of properties who aren't ready for social media even today. But I always think that you have those people who are, who can be advocates, who can be conversation starters. You know, one thing that we've seen a great success with in social media is loyalty programs. There are a number of loyalty programs specifically built for residents of multifamily communities, and those are fantastic platforms for turning residents into social media advocates for the property. You know, hey, come follow us on Facebook, check us out on Instagram, come to our resident event and check in and post a photo on Instagram and use our hashtag. All of those things are are— it's way easier and way more effective, to be honest, to turn residents into those social media influencers than it is to try and give your leasing agent one more thing to do.

Yeah, gotcha.

That's so— Russell, you know, you asked about, about growth. You know, one of the things that we've, we've found is, you know, like I said, we know where we want to focus now. And we're actively seeking partners for integrations. So we're integrating with a lot of other software platforms that are specific to the industry. And we're also partnering with other, other marketing agencies now. So, you know, I mentioned that RentPress is built on WordPress. Anybody can go download that platform and build a property website and use the integrations that we have to pull in real pricing availability. So we've got, um, today we've got about 15 other agency partners across the country that we work with who they're building the websites and we are providing that e-commerce engine to connect it to the multifamily tools.

Has there been any interest in a Squarespace version?

Um, you know, we've explored it. We've, we've seen Squarespace. We've had some people ask about Webflow. That's— that one's gained a little more popularity. Um, right now WordPress is a massive community, then, you know, it's, it's the granddaddy of them all. There's a reason why it powers 40% of the internet. So it's been successful for us so far, but I do think that we will eventually have to expand to other platforms beyond that.

Gotcha. I think it's interesting when you talk about marketing a property versus a person. When I try and get people engaged, I'm looking for human stories. People connect with a person. Do you, do you do a mixture of both? Or do you, are you, are you, are you selling an address? Are you selling a community, a lifestyle, the developer, the owner? How's this?

Or is it— It's, it's, it's, it's kind of all of the above, right? But typically, we're going for that lifestyle, but it's not necessarily, you know, I don't like the idea of talking about it that generally. Luxury means different things to different people. What we have to do is figure out who are the people that you want to go after and what is the lifestyle that they aspire to? One of the things that we really try and focus on when we look at the storytelling component of this is people buy a better version of themselves, and where they live is one of the ultimate status symbols. Where you live, what neighborhood you live in, what building you live in, what your background looks like when you're taking photos in your kitchen or by the pool. Those are all things that, that help you communicate your story.

And totally, welcome to America, right?

Exactly.

It's all about image.

That's it. It's all about image. So what we want to do is paint the picture of what's the better version of yourself that we're going to help you create because you chose to live with us. So some of that's neighborhood, some of that is finishes and features in your apartment, some of that is the level of service and the concierge or the digital app that's going to give you access to new services. There's lots of different ways that we can get there, but that's really what we try and sell is not necessarily here's this person over here that you want to connect with. If those people are there, I absolutely want that property, I want that property manager to share those stories of that team. But I want to show you how we're going to give you that better version of yourself and that aspirational approach. Yeah.

One of the things we've talked about over the years, Mike, that I know you came out early and strong on is the power of branding when it comes to properties and when it comes to not just the branding of a specific property, which of course you do all the time, but the branding of a network of properties, either owned by a developer within a city or throughout different cities, or maybe coalitions of developers who come together on a brand. Talk a little bit about where you came up with that thought, why you feel so strongly about it, and maybe, maybe you can explain it better, better than I just did.

Yeah. I think we saw it in the behavior of how people were shopping, especially when, when we were asked to build corporate portfolio websites for some clients. That really opened our eyes up to shopping behavior and how people navigate. This is the main— this conversation right here is the main reason why ILSs are so successful in our industry, is brand is weak.

Brand is— ILS, just, just for listeners, Internet listing service, that's like the major platforms that publish rental listings across, you know, for many different property owners that where people are searching.

Yeah, thanks for filling in my jargon. But, you know, what we, what we see is brand, brand is typically done at the asset level, it's done at the property level. And if I'm moving across town, or if I'm moving, you know, to a different city, I don't have that level of brand knowledge yet. I haven't been exposed to that brand. You know, let me take a step back. Brand is not logo. It's not the monument sign. It's not the brochure. Brand is we make a promise that we're going to deliver a certain level of experience and we consistently execute on that experience. We consistently execute on that promise. So brand is I can walk, walk into any Starbucks in the world and know my order. Yep. That's brand. It's really tough to execute brand when you're doing it at the asset level versus, you know, and this is where I think scattered site gets really interesting in terms of branding, because you have, you have more of an opportunity to build a strong brand locally, Peter, than, than a lot of much larger firms, because they're trying to do it at the asset level. And you can do it across the whole region. Yeah. And And that's how people shop. If I'm shopping, if I'm coming from across town, I might know what area I want to live in. I want to live in, you know, here in Columbus, I want to live in New Albany, I want to live in Dublin, I want to live in the Short North. I don't know the names of any of the properties. I maybe have seen the buildings before, but I don't know the names of any of the buildings. So what am I going to search for? I'm going to search for apartments near the Short North. And guess who wins those searches? Apartments.com and Zillow. But if I know, if all of a sudden I can come at this from the perspective of, you know, hotels are great and hospitality is a great example. Kimpton is one of my favorites. Kimpton is one of my favorite examples of branding of they've built a really strong brand even though every property has its own unique name. Every asset in their portfolio has a name, but it's really easy to recognize when you're staying at a Kimpton hotel. And I think that that's the opportunity that, that some people in multifamily are trying to go after, but, um, it's difficult to execute.

We've seen that locally here with, with Lifestyle Communities. That's the first one that comes to mind. Um, they're the only local name that I can pull from memory, you know, easily as branding many properties across the city with with the same brand name. There are other developers who have strong brand presence like Kaufman, for example, but their properties all have different names and there's very little like tie-in with the Kaufman name. Now, what do you make of, just to dig on this a little bit, so you mentioned earlier like when you're moving, you're sort of shopping for a better version of yourself. You want to upgrade your lifestyle. It's all about the image. But if I, if I already live at an Acme Company property and I'm moving across town, I guess if I had a good experience with Acme Companies, I would at least give a chance or look at to see what properties they had on the other side of town. But maybe I'm looking to sort of upgrade. It's like, hey, I got a better job. I'm moving across town. I don't want to live in the same old apartment building that is kind of old hat to me now. I want to show to my friends that, hey, you know, now I've made it. I'm living in Dublin and I'm living— I'm not with Acme, you know, Acme's, you know, that's last year's cool, uh, brand name. So how do you think that we could address that?

Um, I think the car industry does this really well. Um, because I agree, you do want to— if I'm making more money, I absolutely want to upgrade from the Chevy to the Cadillac, same company. But they've been able to effectively kind of piece out those audiences and say, hey, here's our, here's our product for the everyman. Here's our upgrade. Here's our heavy, heavy duty. And if you have the portfolio size and you have the ability to execute at that level, which there are plenty of companies in the industry that do, you can absolutely say, here's our Toyota, here's our Lexus. Gotcha. Okay. And keep people in the family.

Yep.

Well, and Peter, I'm thinking about this from a little different angle from— we've been talking about, you know, a brand for the renter who's renting a property, but for a property management company, you have a brand and a promise and a consistency, and your target audience might be rental property owners. And so branding your property management service, you can— you, you fanatically trying to deliver a consistent level of service every month and rally the industry around some standardization. Mike, how would somebody like in property management branding that property management service for rental property owners be a little different than branding a property?

I don't know that it's that different other than just Finding the right pieces of communication that you want to be consistent on. You know, Peter's definitely, he's doing a great job of it with what he's doing locally. But it is, what are the things that we're going to promise as, hey, if you, if you work with us, if you're in our orbit, these are the things that we're going to deliver. And then being able to consistently execute on that promise. We are consistently, here's how we are going to keep your marketing costs low. Peter, I know you have a really interesting, unique take on on property management fees. Like, that's your flag in the ground to say, here's why we're different and why you want to work with our company versus anybody else. And I know you have a bunch more, but that's one of the bullet points that stands out as like, hmm, I need to give them a look. The fact that you are recording this podcast right now and you are sharing your knowledge and bringing people in and trying to further the conversation and move the industry forward says something about there are people who are going to gravitate to that and will want to work with you because of that. So I think that it's, you know, we have, we work with some property management companies on this exact, how do you build that platform? Here's our software, here's our technology, here's our marketing. Here's how we handle screening requirements to make sure that we're taking— here's how we handle curb appeal. All of that becomes the brand promise and the platform that you're now able to deliver to those property owners.

We had this idea years ago that we would, we could create two different brands, one for the property owners when we're marketing ourselves to them, and then a separate, completely different brand that would be the tenant-facing side of things. Um, it would have been a nightmare to pull that off.

We never did it, but it was, uh, I mean, it's, it's two different audiences, two different language, you know, two different desired outcomes. Um, yeah, there's definitely a huge separation there in terms of how you communicate with those two groups.

Yep. I want to take the conversation a little bit different and we can come back to some of the 30,000-foot level stuff. I'm interested in the grassroots tactics that you use. What are some of the resources? How do you think about the Google, Facebook, Twitter, TikTok, LinkedIn, some of those mechanical pieces? How do you put together a tactical puzzle for your clients?

Yeah, I would say, you know, it's funny, there's a lot of it that is not I wouldn't call it super grassroots, but that's, that's not a word that I think of when I think of how we approach our marketing. We can get there. In a lot of cases, you don't need to. The way that we, the way that we look at this is we follow, we follow the customer behavior through the process, and then we look at piece by piece, how do we make sure that we understand what that behavior looks like at each step, and what are the things that we need to do to align our marketing to be the best answer for them at that point in the process. If I'm just starting, you know, Russell, you're out in California. And so, if I said, hey, I'm going to move the company and I'm going to move to Sacramento, the first thing I'm going to look for is not a property management company. I'm going to look for what are the best neighborhoods to live in Sacramento, right? So, that's a very different question with a very different desired outcome, desired answer versus I've done some homework now, I understand where I want to be, I've seen your property and it's in the neighborhood close to my office, now I'm ready to schedule a tour. So the things that we look at are what are you going to do to drive that awareness at the top of the funnel? When somebody's just looking for an apartment, where do you want to be? And that's where Google comes into play and Google Advertising is a huge, huge thing right now for that. We definitely see that there's a place for those listing sites, Zillow and Apartments.com, because that's an easy place to, to get found at the beginning of the search. I think that's an opportunity. You know, there are opportunities there for you to publish content. If you have a content marketing team, if you have a blog, that's a great opportunity to go, hey, get to know the best neighborhoods in Sacramento, or here's why we— 5 reasons we love living in the Short North. That kind of stuff, right? Um, those are the opportunities to get in front of people at the top of the funnel. Once you've done that, now you have to build their trust and you have to convince them that you want to do— that they should do business with you and that other people have liked doing business with you too. And so that's when you really start to get into how do we really optimize the website, you know, through pop-up conversion tools, through pop-ups, through chatbots, through appointment schedulers, through reviews pages and testimonials and all of the different things that we can do from a kind of a sales psychology, marketing psychology perspective. What are we going to do to build that trust? And a lot of that is happening through the website. And then after that, I mean, the name of the game in this industry is follow-up, follow-up, follow-up. There are, there are lots of people out there every day looking for a place to live. And all you have to do is keep asking, you will, you will get more than your fair share of those tours for your leasing agents to show them why they need to live with you.

That is so interesting because it goes against my intuition. I feel like if I'm looking for a place to live, and I identify a neighborhood and then identify a couple properties in the neighborhood that are possibilities. I'm going to go schedule tours of those properties and I'm going to pick my favorite one. And how often or frequently or infrequently this— the goofy leasing agent or the automated bot is emailing me, bugging me to schedule a tour has approximately 0% impact on where I actually decide to live. But maybe that's— maybe I'm either fooling myself or maybe I'm atypical in that way and people are a little bit more malleable than we think. I—

it, it takes people a while to make a decision, especially when it comes to where are they going to live. And too often we see that the leasing agents stopped following up too early and, and just didn't get things— just, they just weren't able to close it.

Yeah.

Um, they weren't able to get them in the door. So, you know, we definitely see that, um, In the cases where, you know, our data shows that in the cases where you have 6 or more pieces of follow-up with any given lead, your closing rate in that leasing office is probably going to go up by 25% or more.

That's incredible. And that is not a topic of discussion in the single-family rental market whatsoever. Everything you just described, I've never seen anyone talk about, discuss. Ask questions about or even consider, you know, in my talks with other property management company owners who are trying to fill units. I mean, we're trying to fill single families and 2-unit and 5-unit apartment buildings, and no one ever talks about, well, how often are you following up with tenants? And I mean, there's a lot of discussion about how often are you following up with clients because we're trying to win more units to manage, but it sounds like that could be an opportunity for our industry to learn from the multifamily industry in, in being way more aggressive about, hey, you, you expressed interest in this property, but I noticed you haven't had a tour yet. Is there a convenient time for you? Um, because if, you know, if, if we as a property management company can fill units faster, that is a huge win for our clients, and, and we're almost obligated to do that as fiduciaries of our of our clients, the property owners. So really interesting stuff.

Yeah. And, and, and every, you know, the more that you can maximize that traffic, the more that you can get those tours in the door from the traffic that you're already getting, the less that means you're not spending as much at the top of the funnel on acquisition, on advertising.

Yeah, I have a, I have a question about the, the cost. Um, if Do I need to aggressive market? If throwing it up on Zillow is getting my units filled, does the marketing budget pay for itself versus what I can get through sort of an easy or bad or limited marketing plan?

Russell, I love that question so much.

Let me give a little background before we launch into this just for those who aren't intimately in the industry. So, and this changes, it's changed a lot in the last few years. So Zillow and Apartments.com, which you've heard Mike mentioned a couple times, are the two big powerhouses when it comes to advertising rental homes and apartments for lease. Zillow is more geared for single-family and small multifamily. Apartments.com is more geared for larger multifamily, like the stuff that Mike's company deals with. For many, many, many years, Zillow was free for everybody. Recently, they started charging, so you do actually pay Zillow anywhere from about 80 cents to $2 per listing per day, depending on your size and scale. Apartments.com is free if you're advertising a single-family or a condo. If you want to advertise an apartment building, it's paid. I have no idea what it costs. It's probably all over the map. And I think what Russell's getting at is like, hey, if I can advertise and rent my duplex on Zillow.com, or maybe in the— in more in context what we're talking about, if I can advertise and lease my 100-unit apartment building using Zillow or Apartments.com free version somehow, what's the point of hiring a company like 30 Lines? And now Mike's gonna tell us why.

You probably, you probably shouldn't. Seriously, you probably shouldn't. There are— so we do somewhere— multifamily is about 80% of our business here at Dirty Lines. The other 20% is restaurants and retail and some e-commerce. And what we've learned from those industries is, you know, there are some metrics there that I like to look at and compare to multifamily. One is customer acquisition cost and the other one is total lifetime value. So, I think we don't talk enough about total lifetime value of a customer because when we think about marketing expenses, we think about marketing expenses in terms of what's my cost per lease for Zillow, right? You know, for the larger properties, Zillow is on a pay-for-performance model. And, you know, Apartment List is another one where it's pay-per-lease and they prove that they walk that person to your door and then you pay them a fee. And, you know, there's, there's some other similar models out there, but what we've seen is we way underspend on marketing compared to a lot of other industries out there. And I don't necessarily think that that's a bad thing, but we way underinvest in marketing compared to many other industries. When you look at marketing as a percentage of total lifetime value of that customer, especially if you can get that person to renew for 1 or 2 one or two leases, all of a sudden, you know, that's a really valuable customer that you've brought in. Here's what I would say about like, we are not in an industry where you figure out your return on your ad spend and then you just ramp up because you can sell more widgets. You don't have any more widgets to sell. So really what you're trying to do is create the most cost-effective way to fill the units that you have available. Once you're done, you know, like, you know, in our— in the larger multifamily, we start talking about, hey, once you get to 92%, 94%, you need to be raising prices. Yep. You know, especially in the market that we've seen, you need to be raising prices. So we're kind of looking at that balance between between occupancy and revenue, you know, and your economic occupancy. What can we— how much can we bring in with what we have? So if what you're doing is working for you and you're able to get a steady stream of leads from one Zillow listing and you've got the right team in place to follow up with those people and execute the tour and make sure that they have great experience, deliver a great first impression, by all means, stick with that. What we see is that it's just, we've got some submarkets throughout the country where they're way overbuilt, they're super competitive, and you have to decide, how are we going to get our fair share of that traffic? And what are we going to do to keep them? That could be concessions, Or it could be we're going to deliver a great experience. It could be— there's a number of— it could be we're going to advertise in other places. There's a lot of different ways that we can approach it, but what we always look at is that total formula. You know, Russell, we actually have a formula that we run with our clients where I can show them if I can improve your leasing performance, if I can improve your leasing team's closing ratio, by 10%, if you're closing at 35% now and I can get you to 38% closing rate, that's a 10% increase. That alone allows you to cut your top of the funnel ad spend by over 50% without changing anything in terms of number of leads in the door and number of leases that you'll sign at the end of the day.

It's a couple of things. I love I love listening to you. This is very pleasant for me. Uh, you did a couple of things that really build trust. And I, I try and emulate— I have conversations all the time where I turn down clients. I explain to them why I'm not right for them. And so I just love that you start out that way, but there's also the credibility that comes with, you know, what you're talking about, both with regard to the marketing and the rental housing business. And that credibility is priceless. I, you, people will pitch and try and fit into a niche because they have some digital marketing skill, but they don't know the business. So, uh, those, those two things, just from a business and marketing perspective, are really pleasant. I'm curious, and either one of you can speak to it, but it seems like the quality of the tenant manages— matters a lot to the owner as well. They want the highest quality tenant. So it's not just the acquisition acquisition cost to race to get it filled. But Peter spends a lot of time on screening and has a threshold on what they're forwarding to their clients. Your clients have to pay extra to approve a tenant, isn't that right? You charge them extra if they want to pick it.

Right.

Nice. So how is, I don't know, is there a difference between between the marketing I might do if I'm going for a particular kind of tenant or quality of tenant than if I'm just trying to get clicks on a website.

Absolutely. Absolutely. And I love the, like, it's not about how much traffic am I driving. It's not even about how many leads am I delivering. I think that that's something that as an industry we need to move away from. It's like, I don't really, that those are not relevant metrics. If at the end of the day, they're not leading to quality residents. So what I look at instead is what are the things that we can do to help people who aren't those right qualified tenants? How can we help them to self, to weed themselves out? So first thing you do is publish the price. Put the price of the rental unit. Hey, this is $1,600. And then, the next thing that you do is you put the rental requirements. You have to have 3 times the income in order to qualify. That alone, like, there are plenty of people who aren't going to read that and they're going to contact you anyways. But for the people who see that, they know right away, hey, maybe this isn't in my budget range. There's lots of other things that you can do there too, like publish the pet policy. Put the answers to the questions out there. The things that you see that typically lead to a less qualified resident, what are the things that you can do to make sure that they see up front, hey, this is how this is gonna operate. This is how the, you know, let's set some expectations up front. Even things like just asking, what are you looking for and when are you looking to move? Adding that tiny little bit of friction weeds out, especially with the way that Facebook is building ads and the way that Google is moving in terms of how their ad platform is going. They want to make it really easy for people to click and convert. I want to put a couple of steps in there so that that person has to stop and go, oh, I do want a 2-bedroom and I'm looking to move on August 1st. Because now that gives my team and my leasing agents, they have a better opportunity to see, yeah, we actually have something that fits what they need.

Yeah. And there's the property manager in me can't help but speak up here and point out that you need to be careful when you're designing advertising for rental homes. It's very easy to run afoul of fair housing without realizing it. Something as simple as saying, 'Oh, there's a church right down the street.' Fair housing violation. Something as simple as saying, 'Great for retired couples.' Fair housing violation. Saying something like, you know, anything having to do with referencing families or the lack of kids, or, you know, there's many ways to get in trouble here. So be careful when you're marketing properties, big or small. I know that it's gotten difficult on the Facebook side as well, and I think Google as well, when they recently clamped down on the categories that you can use to filter out. Basically, how can you market rental homes to customers? There used to be a lot more categories that you could use to fine-tune that, and they got rid of a lot of that due to fair housing issues.

It's all stuff that you shouldn't have been using anyways. Yeah, right. Like, and that's something that we advise our clients on years ago, is like, it's great that there— these tools are there, and it's really handy for if I'm trying to target makeup or I'm trying to target, you know, grilling tools or something like that, but it's not stuff that you should be using if you're in this industry, you know, if you respect fair housing and equal housing opportunity. You should have never been using that stuff in the first place. And there are still ways to— I 100% agree, and we support fair housing in every way. Like, we train our people on it here at our agency. I want them to know this stuff inside and out because we don't want to put our clients in a bad position. Um, but there are ways to talk about who you're for, right, without excluding anybody.

Yeah, and you can even do that through, you know, the imagery that you present on the website and, you know, who's living there, you know, who's in the photo, you know, the models and the photos and stuff, which again, I think you need to be careful with, even if something's not technically illegal, there's a moral, you know, kind of gray area there. Swinging back to the kind of business side of things for a minute, I remember, Mike, one of the things that we talked about, about 18 months or maybe 2 years ago, I was starting to consider hiring a salesperson, someone to talk to prospective new clients about our property management services. And I was really nervous about it because I had this feeling like, well, no one's going to be able to explain it the way I do. And the leads, they're going to want to talk to the owner. They're not just going to talk to some stupid sales guy that was hired 2 weeks ago and has never even managed a property in his life and blah, blah, blah, had all these fears and limiting beliefs.

And I—

and you were quite clear in our discussion because you had long ago hired, I think, multiple salespeople to do your business development. And you were like, dude, you just got to do it. Like, the sooner you do it, the better. You're never going to look back. It's going to be the best thing you ever did. I remember it so clearly. And it took me a while, but I finally did do that almost exactly a year ago. We hired our first sales guy. He's been doing really well. The rate of new clients has dramatically accelerated since we brought him on. Because he's a professional sales guy. And that's all he thinks about all day, every day is how can I win more clients for our business. He learned enough about property management to be dangerous. And I'm sort of continuing that training and education as we go. But that was something that now looking back, I wish I would have done differently. Mike, as you look back, you know, in the years since you founded 30 Lines, is there anything that comes to mind that you would have done differently, uh, to kind of get to where you are now faster?

Uh, raise money. I mean, interesting. I specifically chose not to, but you know, it's, it's way easier to move faster when you've got a bigger team and, and, you know, you can get a lot more people rowing the boat. Um, I've chosen not to do that. We've been fine without it. We've been able to, through our own business development and through a lot of effort on our thought leadership, we've been able to grow the business kind of the way that we wanted to. And what I found is that we're not for everybody, right? We're not. There are definitely clients who are not a good fit for us. And like I talked about before, We've figured out what we want to be doing, what we don't want to be doing. I think the biggest thing, you know, I think you'll be into this just because of what I see you doing. The biggest thing beyond, besides that is, is just as, excuse me, as quickly as possible, figure out the processes in your business that are repeatable and find all the places that you can automate them. Yes, absolutely. And because you got to figure out how to— Russell's laughing. You got to figure out who are the people, like, how can you make it so that more people can do those tasks and can do them well and do them accurately and do them on time? And the more that you can document those processes, you know, we do a lot of screenshots, a lot of, you know, a lot of like Loom videos. Loom videos are great for that. Yeah, those things are fantastic. So we put together those standard operating procedures and, you know, now we've got a whole, a whole drive full of that stuff. But not only that, we're, you know, through our project management tool, through Slack, through, you know, through Zapier, you know, we're able to kind of connect some of these things so that as soon as that client fills out a form, It puts the workflow in motion, and now I've got 4 people on my team who all know exactly what they need to do next based on the fact that that client submitted the form. Beautiful. Doing those kinds of automating workflows and identifying what the workflows are that can be automated, that makes a huge difference.

Completely agree. And I was early on that because property management It's just nothing but a series of tasks. It's extremely repetitive and consistent in that way, which is appealing to me as an engineer because I can, I can engineer that system and tune it and tweak it and make it better and better. That's really interesting about the raising the money thing. So it sounds like you would have been comfortable giving up equity because you feel like you would have gotten, you would have gotten there faster and maybe even been way bigger than you are now. You'd rather own 80% of a bigger piece of pie than 100% of a smaller one?

Um, I mean, I don't know. I can make the argument for and against both ways of doing it, right? Um, I think what we found is that we, we have a vision for what we're trying to do specifically with the software that we're building. And, um, you know, the marketing agency side of the business is not super appealing when it comes to, you know, people want to buy software, people want to buy, you know, books of, you know, you bought a book of business of properties that you could take over. The marketing agency side is a little bit less appealing in terms of an acquisition target, but it's allowed us to subsidize the development of the software that we want to build. And, you know, we've got We've got full authority and direction on how we want to build that, what features we want to add, who we partner with, all of those kinds of things. So listen, I'm definitely not the expert when it comes to should you go to a VC, should you go private equity, should you go SPAC or whatever. That's not my realm of expertise. I'm just trying to to run a good, efficient business and deliver what I, you know, we see gaps in the market and we're trying to execute on those gaps.

It's interesting. I have, I've read books on systematizing. I've read a couple of books that Peter's recommended and it doesn't fit my skillset at all, but I sort of rationalized it in that I can't do that and it might not fit exactly for my digital marketing business and for what I do. I have digital marketing in a political space, and I have 7 to 10 clients a year, and we do a really good job in my little space. And, but I recognize that it's not, or I've rationalized that it's not It's not systematized and repeatable. And for what you've described, it would be if there were a better leader in charge or a different leader anyway. But the idea, and I've taken the revenue as I build the business, I'm taking revenue from what's a really good business that might not be saleable, and I'm building an app and developing that out so that the app can interact for the parts that— for different parts that are repeatable and accessible. So I'm doing it similarly.

What I've found is that there are very few brains that work the way that Peter's brain works, and what you have to do, like, just take it step by step and just go, all right, let's look at this one piece of the business, this one thing that we do on a fairly repeatable, repeatable basis, I don't even care about the automation first. I just want to know, like, let's just get the steps down in order so that we all understand and we all agree that this is what we're supposed to do. Then you can go back and look at it and go, all right, steps 2, 4, 7, and 9 we can automate and, and, and take 40% of the work off of your plate. But I don't You know, I find that it's, it's rare that, that people have those automation tasks already in their mind. You kind of have to, you know, this, this kind of goes back to one of the big things that we look at with, with our agency is I'm constantly looking at on the marketing side. I want to look at like, what are, what's the experience we want to deliver? What's the message we want to communicate? And then on the technology side of the house, it's What's possible with the technology that's available today? And if you can get those two people in the room talking to each other and you can intersect and you can find those opportunities, now all of a sudden it's like, well, the marketer's talking and saying, I would love to be able to do this. The technologist is going, yeah, we could do that. I've got something for that. Like, let's— here's, here's how we can put that together and create the experience. It's the same thing with, you know, similar approach with Here's what I'm trying to do. All right, here are some tools that are out there, Airtable or whatever, that can help us automate that process for us.

Awesome. Well, we're coming up on an hour here. I want to be respectful of your time, Mike. Russell, any last questions or thoughts here?

Do you have a— do you have any book recommendations? Are you reading anything lately or anything in your career that's been helpful that you can point us in the direction?

Yeah. I mean, um, you know, I'm, uh, so I mean, there's a number of them, but, um, we follow the EOS system. We follow, uh, you know, Traction is a big one for us. Um, you know, I'm still working on, on getting to those level 10 meetings, but, um, that's been a big one for us.

I'm going directly from this recording to our level 10.

So yeah, we're, um, so I don't want you to be late for that. I know, I know that I got the rules. Um, Measure What Matters has been a good one. And then, you know, I follow coaches and, you know, I'm really fascinated by the idea. You know, I think that leadership is— there's so much that we can learn from coaches. And so I actually liked Phil Jackson's book, 11 Rings, just to get some insights into, because he has a very unorthodox approach to how he coaches the massive egos of NBA superstars. And it was just a, it was a fun read. It was interesting getting into his mind and really understanding everything that influenced him to become, you know, the best coach ever.

Thanks, I appreciate that.

Yep.

Well, this has been great. I appreciate your time, Mike. I always enjoy chatting with you and everything from the nitty-gritty of ad tech and properties and marketing of properties and how to run, you know, run and grow a small business. So thanks for coming on today. And thanks everyone for listening. We will see you next week.