From our guest blogger Brian Jones, a former Business Development Specialist at RMS.
Market assessments for senior living communities are often more than a go/no-go stage-gate for project feasibility, and they should be. New construction or renovation projects provide business development and marketing managers with an ideal occasion to conduct due diligence via a thorough market research study. After all, isn’t the purpose of the feasibility process a risk reduction exercise? Decision makers should take full advantage of the opportunity to ensure that their senior living project will be successful.
Industry accepted methods and processes for these projects involve consideration of expert opinion, demographics, health-based needs, organizational culture and plans, competitive intelligence, the financial landscape, and resulting market penetrations. Consumer-driven research is often used to back up these sources of information and address questions at a market specific perspective. In some instances, it may be sufficient to conduct a couple of focus groups to add insights and depth to the current information, but more extensive market research may be required in other instances.
Under what conditions does it make sense to be more rigorous in the application of primary market research for a senior living project? Here are four circumstances where consumer survey research adds invaluable information to a market assessment for a senior living project:
1. Uncharted conditions: Market potential analysis depends on primary research if an innovative or non-typical living environment is being evaluated. For example, a pocket neighborhood for seniors may be a great idea but there is little direct historical data available to estimate demand. Market based evidence from interviews with potential residents and/or family caregivers can provide a more reliable predictor of actual demand for a given location. Of course, survey data must account for likely behavior such as predicted (actual) demand versus stated interest and intent.
Key questions include:
- What is the level of interest?
- What is the likelihood to move?
- What is the willingness to pay?
- What key attributes drive or detract from interest (e.g., location, sponsorship, access to care)?
- What is the preferred option among potential locations?
2. Design and amenity trade-offs: Survey research provides project decision-making support for physical design and amenity considerations; it contributes to recommended unit size and mix. This will have an impact on the pricing structure and payback period for the project.
- What is the relative importance of various features, services, and types of amenities under consideration and which are preferred as a la carte versus inclusive?
- What is the preferred level or amount of services (e.g., frequency of housekeeping or transportation services)?
- What is the preferred method of paying for the residence and services?
- What other lifestyle considerations are critical and may be relevant to the project?
- What is the preferred size and style of residences when there is a trade-off for larger and more costly versus smaller and less costly units?
3. Market insights: Market specific questioning may reveal unique challenges or considerations that can be incorporated into marketing and communications plans.
- What is the market receptivity of the project and how does it differ by location or consumer demographic?
- What is the preferred method and media source(s) for communicating with prospects?
- What is the current position of your brand within the market area?
- What are some potential characteristics that might help your community stand out from the competition?
- What characteristics will make your community more attractive to future seniors/baby boomers?
4. Strategic implications: Some stakeholders may have unanswered questions or concerns well into the planning process for a senior living community renovation or new construction. Survey research may help to address issues related to compatibility with strategic goals and demonstrates seriousness of commitment to consistency with market need. The results may also reveal unforeseen impacts so they can be dealt with early in the planning process.
- What is the overall attitude and opinion associated with the model(s) of housing and services being evaluated?
- Are there any sources of competition you were previously unaware of?
- What is the strength of interest and demand from affinity and targeted populations versus seniors overall?
- What is the lift in interest and impact associated with the brand and any existing services or housing options?
Consumer-driven market research allows you to better assess project viability from a marketing, design, financial, and construction perspective. More information increases transparency of the planned project and helps to sell change and uncover possibilities. By focusing on the needs and opinions of the potential future residents and their family members, it generates a much stronger case for if and how the project should unfold.
Interested in how market research support of Senior Living and Retirement Communities can help your organization? Contact our Director of Business Development, Sandy Baker via SandyB@RMSresults.com or call 315-635-9802.