This article was written by David Smith and originally published on Senior Housing Forum.
Sherpa has just released data about hundreds of thousands of sales interactions between senior living prospects and sales counselors. The data makes a compelling case that spending more time with fewer people increases sales effectiveness. We hope that this first of its kind study will help all senior communities achieve faster fills and higher occupancies. Even more importantly, we would like to improve the quality of life for many more seniors by helping more of them say yes.
Our unique Prospect-Centered Sellingsm approach helps prospects overcome resistance and “get ready” before they are forced to move due to a health related crisis. This approach has consistently produced industry leading visit to tour conversion ratios. With Sherpa we now have the data to identify the sales activities and behaviors that impact those ratios and in what proportions. We are sharing our findings in the hope that you and some of the higher functioning seniors in your markets will benefit from them, regardless of whether you ever become a Sherpa user or not.
Origins of Prospect-Centered Selling
My quest to find the key factors that help individual prospects “get ready” began nearly thirty years ago, when I struggled to fill The Gatesworth, our independent living community in St. Louis. I mistakenly assumed that our elegant building, well-groomed grounds and extensive services would make it easy for prospects to say yes. However, the strong emotional resistance that I encountered from higher functioning prospects surprised me. Confronting that resistance with my well-honed residential real estate sales skills proved ineffective. It was not until I started spending more time with each prospect already in the lead base that our conversion rates soared. The incremental time was invested in building trust, listening to their life stories, planning meaningful next steps, and sending personalized creative follow up . We filled our 220 units to 100% in just 23 months, closing the last 50 in just 90 days!
During dozens of successful turnaround fill campaigns thereafter, my partner and Sherpa Co-Founder Alexandra Fisher and I spent many hours researching, teaching and field testing techniques adapted from psychology, including motivational interviewing and stages of readiness for change. This helped us better understand and work with the typical prospect’s internal decision-making process. It does require the investment of more time per interaction but the returns on that investment are substantial. By using this approach across the US and Canada, we consistently reached 45% to 50% visit to close ratios. From our experience we believed that investing more time with fewer prospects lead to faster fills, and higher occupancies and higher functioning residents. Our increase in effectiveness also meant that we can get to same number of move ins with less leads and lower marketing expenditures.
Initial Sherpa Study Findings
We developed Sherpa to automate Prospect-Centered Selling. With over 350 users, Sherpa now has an extensive database. Dr. Margaret Wylde and her team at ProMatura reviewed data from 302,159 interactions captured in Sherpa during 2015. The data came from 502 independent, assisted living and memory care salespeople nationwide. ProMatura found that based on national visit to move in ratio benchmarks, communities using Sherpa significantly outperformed non-Sherpa users. It further concluded the most significant factor leading to better sales conversions is investing more Time in the Selling Zonesm (TSZ) with fewer prospects. TSZ is defined as time spent: face-to-face, voice-to-voice, planning next steps, and personalizing creative follow up.
For prospects that did close, sales counselors invested on average 18 hours in TSZ from inquiry to move in for IL and about 10 hours in TSZ on average for AL and MC. Among Sherpa’s top performers, the greatest impact on conversion ratios comes from allocating more of the total TSZ in: planning next steps before (19%); and creatively following up (23%) after each prospect interaction. Conclusions from the initial phase of the study directly challenge the generally held belief that making more call outs and generating more tours, regardless of the time invested, is what drives more effective sales. Future stages of our study will include exploring ROI for TSZ invested in specific sales activities, optimum number of prospects worked based on total TSZ available, and the costs associated with having too many leads