E-Commerce in Apartment Marketing: Part 1 - Understanding the Differences

You've probably heard it from industry peers or maybe you've said it yourself:

Renting an apartment should be like buying a product online!

While we generally agree, we decided to embark on a journey to analyze this statement as apartment marketers and understand the similarities and differences between these two experiences, influencing factors, and look at some powerful e-commerce tactics we can apply to apartment marketing.

This is part 1 of 3 from our series on marketing apartments using powerful e-commerce tactics, focused on comparing the two experiences: renting apartments versus shopping online.

Is renting an apartment online just like shopping online?

While they are both purchasing decisions, they differ significantly in terms of how decisions are made.

Let's examine the two shopping experiences by looking at four different characteristics that impact the decision making process.

Type of decision

The decision to buy a product online is usually a low-involvement decision, where the consumer is seeking to purchase a product quickly and easily without much thought or consideration.

On the other hand, the decision to rent an apartment is a high-involvement decision, as it involves a long-term commitment and has a significant impact on the consumer's daily life.

Price

Online e-commerce purchases have an average order value of $121.18, where consumers tend to make more impulsive decisions and are less likely to engage in extensive research and evaluation. They are more likely to be influenced by factors such as convenience and availability, and less likely to be influenced by factors such as brand reputation or product quality.

Conversely, national median monthly rent for apartments has been at $1,979 in Dec 2022. Such a high-price type of purchase tends to make renters engage in more careful consideration and evaluation of their options. They are more likely to research apartments, compare rent prices, and weigh the benefits and drawbacks before making a decision.

Psychological implications

When making low-involvement purchases online, it's easier for consumers to get into emotional buying mode, and let emotions such as such as happiness, fear, guilt, or anger influence their decision. Marketers often try to tap into these emotions by creating ads that evoke an emotional response in the consumer and trigger a purchase decision.

High-involvement decisions like renting an apartment require a significant investment of time, money, or resources. Renters typically engage in a thorough evaluation of their options and are more likely to consider their personal values, goals, and preferences when making a high-involvement decision. They also expend a higher level of cognitive effort and are less likely to be influenced by emotional factors or external pressures.

Buying Cycle

The impact of a purchase on a person's life is directly correlated with the length of the buying cycle for such a purchase, making renting an apartment a much slower process than buying a product online, which is very transactional and fast.

Buying cycle length has direct impact on how e-commerce specific marketing tactics perform when applied to apartment marketing. For example, optimizing a property or portfolio website for converting first time visitors directly into applicants might be premature, as they may still be in the consideration stage of the marketing funnel, and are not yet ready to apply. Optimizing conversions for joining an email/SMS list or scheduling a tour might yield better results.

Please join the conversation in the comments below, and stay tuned for part 2 of our series, where we'll be looking at factors that influence e-commerce purchases and how they translate to apartment marketing. If you're not following us yet, please do so at Multifamily Marketers.