Using AI and Machine Learning to Personalize the Marketing and Service Delivery of Seniors Housing
Personalization reduces customer acquisition cost by as much as 50%, lifts revenue by 5% to 15%, and increases the efficiency of marketing spend by 10% to 30%.
The greatest threat to brands today is the future.
No one really knows what it holds, particularly in seniors housing and care. Will older people continue to move into congregate style communities to live with others over the age of 85, where the activities of daily living are provided, and monthly cost can be as high as $5,000 per month? Or will they choose intergenerational living in urban locations where lifestyle is at their fingertips and care is ordered up via telemedicine or home health services at half the cost? Or will technology disrupt both options and allow people to permanently stay in their own homes?
No one really knows the answer.
We are currently reading chapters five and six of this month’s Executive Book Club, The Customer of the Future by Blake Morgan. I had to step away so I could process what I was reading; this is not for the light of heart and my head was spinning while trying to understand how to apply artificial intelligence (AI) and machine learning to seniors housing! Yet just because something’s hard doesn’t mean we should stop trying to understand it- so I dug in.
UNDERSTANDING AI AND MACHINE LEARNING IN LAYMEN TERMS
Odds are you use Spotify or Netflix. When in Spotify, the streaming music app, the home screen typically will show recently played music as well as recommended music and based on your recent listening will offer new selections centered around your music preferences. As a customer these recommendations have introduced me to new artists and entire genres I otherwise would have never found, such as She & Him and Rebelution!
The same holds true with Netflix. Upon opening this streaming entertainment app you will see your current list of shows alongside what is trending and an entire selection titled Because you watched The Crown and Top Picks for Traci…all of this personalized to you as the Netflix customer and based on your preferences and selections; it’s genius.
Both Spotify and Netflix use AI and machine learning to personalize your customer experience as does Amazon, Goodreads and the many other brands you consume. Not only does this technology court new customers to each platform and make the buyer experience personal, but it keeps them engaged and loyal due to the ease of the experience and that zero-friction process we read about in chapters three and four.
HOW CAN SENIORS HOUSING USE AI AND MACHINE LEARNING TO MARKET ITS COMMUNITIES?
The question I am pondering as I digest the information in these two chapters is, ‘what does this mean to seniors housing?” It seems every industry will be impacted by AI and machine learning and the bulk of this work will fall on the plate of the companies’ Chief Marketing Officer. In this blog we are going to discuss both in detail and set the stage for chapter seven where Morgan dives into digital transformation, step-by-step.
My goal as the facilitator of each book club study is to translate these books and consider how these new ideas and strategies can be parlayed into the seniors housing space. Please know I’m learning right alongside you. I’m not only reading this book but have sitting in front of me an 800-page Digital Marketing for Dummies book too! The reality is that digital marketing is daunting; there is so much to learn and it is ever evolving. Not only do I want to stay at the forefront of marketing and technology for my clients but also for my own company. I just don’t see enough information being shared on this vital topic in our space nor the expertise that’s needed to be successful.
CUSTOMER-FOCUSED MARKETING AND THE ROLE OF CMO
Globally, a customer-focused digital transformation is underway. The strongest brands today are curating the brand and its content alongside the customer via AI and machine learning (as I shared in the introduction of this blog). We are going to dive into what that means and try to decipher how to leverage these tools in the seniors housing space starting with WHO’S job it is to manage it.
The Chief Marketing Officer (CMO) of the future must understand how and when to use technology to steer the digital transformation within the company they serve. This is a major constraint within seniors housing as the role itself has become more difficult to source and even then most are unfamiliar with digital marketing, let alone AI and machine learning.
Due to the complexity of marketing and the speed of transformation, unless you have a growth-minded CMO, it’s time to look outside our space, to source and hire individuals who have a track record of success moving brands forward within the framework of a digital landscape. The CMO of today has a responsibility to understand the new digital landscape, the tech landscape and how these technologies can create a frictionless experience for the customer, starting with employees.
In the past, marketing focused on attempting to satisfy the needs of a group of customers rather than individual customers (think Blockbuster video versus Netflix). In seniors housing that meant looking at age, income and location to target new customers, particularly when in a lease up situation due to a new development.
Today, technology has given marketers the ability to be more exacting in their approach. Rather than focusing on list segmentation by looking at past attributes, we need to leverage data to understand individual customer behavior. Simply put, list segmentation is no longer enough. For true accuracy we must lean on technology to get to know the individual customer better. That means personalization- shaping an experience for a customer based on individualized preferences (just like Spotify and Netflix do for you). That is the future of marketing and it’s incredibly exciting but not for the faint of heart.
What I love about this topic is that here at Bild & Co, we have been teaching the importance of a personalized sales experience for two decades. Diving into what it takes to embed that same level of customization into an automated marketing system is exhilarating!
It’s time for seniors housing owners and operators to invest in creating a technology platform that serves its many stakeholders. Not only would doing so remove customer friction but also provide a wealth of data to use in marketing the communities to prospective buyers.
As I brainstorm the many benefits of a senior’s housing technology platform (and maybe one exists I haven’t seen?) leveraging AI and machine learning (meaning tailoring the resident experience as it learns about the resident), here is what immediately comes to mind to me: Everything a resident, prospective buyer or customer needs at their fingertips, whether on their phone or computer:
- Lifestyle: Daily listing of events, trips and activities to participate in as well as who is attending (optional by user) so residents can plan their day or week (with optional visibility to family members)
- Dining: Each venue along with what’s on the menu to include the ability to pre-order meals, make special requests and even delivery to a resident’s room
- Transportation: Scheduled transportation or the ability to request transportation
- Housekeeping and Maintenance: Request and schedule housekeeping services and maintenance issues
- Billing: Review and pay rent, care fees and ancillary services to include what’s available for purchase that residents may not be aware of
- Customer Service: Resident complaints, complements, referrals and more for ease of communication and fast response from the staffing team
- Care: Tracking of care provided as well as the ability to request care and communicate with family members so everyone’s on the same page
This type of platform has endless capabilities. While AI is computing what individual residents favor, the machine learning begins to curate suggestions to individual residents, further improving their experience with the community by offering what’s trending in the community, suggested things to do today, or Sheryl’s favorites! Imagine this type of tool within an independent and assisted living, life plan or active adult community, it would be transforming.
More importantly it can track the habits and trends of residents so that you as an executive quantify the data and use machine learning to begin offering more personalized experiences to your customers and prospective buyers who want to put their toe in the water before moving in.
BACKING INTO FUTURE RESIDENTS BASED ON COMPELLING DATA
Owners and operators could also use such a platform to build out resident personas; learning more about the actual buyer the senior living brand attracts. This information would allow targeted marketing to a smaller demographic yet with much higher conversions; saving the company both time and money.
Here is the data I would like to see as a starting point:
- Clearly the basic information such as age, income, zip code that we gather now
- Was the individual a professional, white or blue-collar worker, a homemaker or service member? What type of profession is your brand attracting?
- Does the individual enjoy cultural experiences like the arts, or would they rather binge watch television from the comfort of home?
- What is their political affiliation and educational background?
- Pets and if so, what kind?
- Hobbies, languages spoken, interests, and more!
Knowing this type of information is vital to the future of marketing and will allow you to hyper-target qualified leads who are the right fit for your specific brand and its offerings. AI and machine learning can help curate this type of detail on customers that your staff is rarely going to document. Even better, you can then shape community offerings based on findings and court those new customers in a much more meaningful way. This is what Harley Davidson New York was able to do to increase their lead generation by 2,930%.
ALL YOU HAVE TO DO IS TAKE THE FIRST STEP
Don’t get overwhelmed with the how to yet; my first goal is to get you as an executive to buy into the importance of AI and machine learning and to expose you to the concept. My second goal is to get you to take action and begin the learning journey, to find a strong CMO, give this person a seat at the executive table and start taking baby steps toward evolving the way we market, sell and deliver independent and assisted living, memory care, active adult and continuum care retirement communities. The one thing that is clear is everyone loves to feel important and that’s what personalized marketing does and why I’m so excited about this topic.
80% of customers say they are more likely to do business with a company that personalizes experiences, and 90% say they find personalization appealing
AI AND MACHINE LEARNING DRIVES LEADS BY 2,930% FOR HARLEY DAVIDSON NY
Harley-Davidson New York is a perfect example of a company that decided to experiment with AI and machine learning. They were able to increase dealership leads by 2,930% in three months, imagine that! Half of the leads were look-alikes, prospects with similar buying patterns and preferences as those likely to purchase Harley-Davidsons. This insight opened an entirely new audience that they had previously not marketed to. The AI uses algorithms to calculate which customers are most likely to purchase and create targeted messaging toward those customers. It also tracks which digital campaigns are effective and learns as it goes.
I am confident that we can utilize the same tools in the seniors housing space to attract more prospective buyers as they too have very specific commonalities. If it works for motorcycles, movies, music and clothing, there is no reason it won’t work for seniors housing too.
In the next chapter we will learn how many of these technologies have been applied to digital transformation, and how you can think about becoming customer-focused when it comes to the technology decisions you make at your organization.
The Bild & Co team can support and advice you on marketing your seniors housing communities more efficiently. Want to drive more qualified leads and convert a higher percentage to move in for improved revenue and net operating income? Email Revenue@BildandCo.com to set up a call with Traci Bild and Jennifer Saxman.