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Marketing Plan for Apartment Complex to Increase Occupancies in South Carolina Coursework

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Updated: Jan 16th, 2020

Situational analysis

Abberly Village is an apartment complex company that operates within the US. Over the years that it has been in operation, the firm has managed to attain an optimal market position by offering luxurious apartments. Additionally, the firm offers a variety of apartments which include one-bedroom, two-bedroom and three bedroom apartments (Abberly Village, 2011, para. 2).

In an effort to increase its occupancy rate, the firm has effectively designed its apartments. One of the ways through which the firm has achieved this is by ensuring that its facilities are clean and up-to-date. Additionally, Abberly Village has a well trained staff that ensures that the clients are well served.

The recent economic recession has made the US housing industry to be very challenging. For example, the cost of purchasing a home has become prohibitive. This is due to the fact that it has become hard to access credit finance from the financial institutions.

This has stimulated potential homeowners to consider alternative means. One of the alternatives which they are considering entails renting apartments. In an effort to attain an efficient market position, Abberly Village management team is committed at increasing its occupancy rate.

Market Summary

The US apartment industry is a core component of the country’s Gross Domestic Product. Approximately 30.6% of all US households live in rented houses. According to National Apartment Association (n.d, p. 2), the annual revenue collected from the apartment industry averages $ 155 billion which is equivalent to 2% of the country’s total GDP (National Apartment Association, n.d, p. 1).

Over the past few years, the US apartment industry has experienced significant growth. In February 2011, the national occupancy rate was 93.6% (Wood, 2011, para. 3).Despite the adverse effects of the 2007 economic recession, it is expected that the apartment industry will grow with a rate of 5.5% in 2011 (Wood, 2011, para. 4). The growth is expected to arise from improvement in the country’s economy (Foong, 2011, para. 1).

Foong (2011, para. 8) asserts that the growth in the US apartment industry is determined by the level of employment. Over the past few years, the US job market has undergone a modest growth. It is also expected that it will take a number of years for the US to recover the 8 million jobs lost. This means that the market growth will be relatively slow.

Despite these changes, there has been emergence of a positive perception towards rental housing in the US in the recent past. According to Haevens (2007, para.1), a significant proportion of potential home buyers in the US are considering renting apartments rather than buying a home.

A survey conducted by Harris Interactive in 2010 revealed that 76% of US consumers prefer renting an apartment compared to buying a home. This represents an increment with a margin of 5% compared to 2008 (National Apartment Association, 2011, p. 3). This trend is mainly common amongst the young consumers.

One of the factors that have led to this trend relates to the adverse effects of the 2007 economic recession on the US housing industry.

Considering these effects, a large number of consumers are valuing renting apartments compared to home buying. In order to meet the demand for rental homes in the United States, it is estimated that approximately 300,000 units should be constructed annually (National Apartment Association, 2011, p. 3).

The apartment industry in the US is undergoing a rampant evolution. One of the trends that characterize the industry relates to the high rate at which firms are undertaking technological advancements in their apartment complexes. Additionally, firms in the industry are also undertaking continuous improvement of their apartment complexes in an effort to increase occupancy rate.

There is also a high probability of the US apartment industry experiencing an increment in rent levels. In 2010, the national vacancy rate in US declined from 7.8 % to 7 % (Foong, 2011, para. 9). It is estimated that the average vacancy rate will decrease to 5.8% in 2011.

This will result into an increment in rent with a margin of 5.94%. This makes the apartment industry to be very lucrative. By the end of 2011, it is estimated that apartment occupancy rate in the US will be more than 95%.

Product offering

According to Kotler and Scheff (2006, p.189), product offering refer to the ability of a product to meet the customers’ needs. This means that the customer should benefit upon consuming the product. In its operation, Abberly Village is committed at ensuring that its customers attain a unique experience. To achieve this, the interior and exteriors of the apartment complexes are well designed.

This has been achieved by integrating a wide range of amenities which include unique floor plans, spacious porches and generous oval soaking tubs, dryer and full size washers, maple cabinets, expansive windows to allow flow of natural light, elevators and detached garages. The firm has also adopted effective apartment management strategies.

The apartment complexes also have a cyber café, coffee bars, a business center, cutting-edge fitness center and entertainment area, lively clubhouse which are fitted with large screen television, wireless internet in the clubhouse and the pool area and gated entry. The firm also allows pets within its apartments.

Competitive analysis

The apartment industry in South Carolina is characterized very competitive. This arises from the fact that there are numerous firms within the industry. In its operation, Abberly Village apartments face intense competition from a number of firms.

The main competitors include Lauren Ridge, West Winds, Greenhill Parish Crossing, West Vista, Greenbrier Apartments, The Haven At Lake Murray, Lullwater At Saluda Pointe, The Ashton, Quail Run Apartments, Landmark, Tanglewood and The Arbors At Windsor Lake (Abberly Village, 2011).

These firms have effectively positioned themselves in the apartment industry in South Carolina. The firms also offer a wide variety of apartments in order to meet the customers’ needs.

Considering the dynamic nature of the apartment industry in the US, most of Abberly Village competitors are increasingly being concerned with developing their competitiveness. One of the strategies which they are incorporating entails undertaking proper maintenance of and remodeling of their apartment complexes in order to deliver a unique experience to their customers (Causey Contracting Incorporation, 2011, para. 1-4).

Additionally, Abberly Village competitors are also reformulating their pricing strategies in an effort to attain price competitiveness. These firms are also installing a wide range of facilities in their apartments.

Abberly Village also faces competition from other firms within the hospitality industry such as restaurants. Therefore, it is paramount for the firm to enhance its competitiveness.

SWOT analysis

The chart below illustrates Abberly Village apartment strengths, weaknesses, opportunities and threats.

Strengths

Market recognition- The firm has attained sufficient market recognition in South Carolina

The firm has effectively designed its apartments and fitted them with current technologies such as internet to meet the customers’ demands.

A strong public image -The firm has a qualified apartment management team

The apartment is surrounded by a strong neighborhood that has a wide range of facilities which include recreational facilities, hospitals, shopping center, restaurants and an airport (Abberly Village, 2011, para. 1).

Weaknesses

The firm has not sufficiently diversified its scale of operation. Currently, the firm mainly operates in West Columbia in South Carolina.

Opportunities

The change in perception towards renting apartments compared to homeownership amongst the consumers presents a feasible market opportunity for the firm.

The real estate industry is undergoing a significant transformation as a result of the high rate of technological innovation.

Firms within the industry are able to design and construct attractive apartments. Integrating these technologies will enable the firm to appeal a large number of potential renters.

The current economic growth in US presents an opportunity for growth of the apartment industry due to an increment in the number of potential buyers.

Threats

The lucrative nature of the industry will result into increment in the degree of rivalry as more firms venture the industry.

Occurrence of another economic recession presents a threat to firms within the apartment industry. This arises from the fact that the recession may lead into loss jobs amongst the consumers hence reducing their purchasing power.

The recession may also lead into an increment in the rate of interest thus making it costly for the firm to use external finance such as bank loans to improve its apartments.

Key Success Factors

According to Kotler and Keller (2009), the success of firms in different economic sectors is dependent on a number of factors which are referred to as the key success factors. To increase the occupancy rate, Abberly Village apartment management team will integrate a number of marketing strategies. The firm will incorporate the 4ps concept in its marketing strategies.

To ensure that a large number of customers are aware of the firm’s existence in the market, the management team will incorporate the concept of Integrated Marketing Communication.

This will entail using emerging and traditional marketing communication techniques and tools. Additionally, the firm will also ensure that there is a continuous evaluation of its marketing efforts. This will enable the firm to make the necessary adjustments in its marketing plan.

Critical issues

Considering the fact that the success of firms in the apartment industry is dependent on the nature of relationship established with the tenants, Abberly Village management team will integrate effective customer relationship management techniques. To reach its customers, the firm will also incorporate different strategies in its distribution strategy.

One of these strategies will entail use of the internet whereby the customers can be able to view the interiors of the apartments virtually. Additionally, the firm will also use agents in its distribution strategy. The agents will be charged with the responsibility of ensuring that the customers’ access comprehensive information regarding the apartments.

One of the issues that the agents will focus on relates to the amenities offered in the apartment complex. Additionally, the firm will design a model of the apartment which will be shown to clients. To get a better view of the apartments, the clients will be shown around by the agents. This will enable the client to make an informed decision.

Reference List

Abberly Village. (2011). Neighborhood: Apartments in West Columbia, SC. Web.

Causey Contracting Incorporation. (2011). Virginia remodeling contractor. Web.

Foong, K. (2011). . Web.

Haevens, A. (2007). Apartment industry benefiting from housing downturn. Web.

Kotler, P., & Keller, K. (2009). Marketing management. New York: Pearson Education.

Kotler, P. & Scheff, J. (2006). Standing room only: Strategies for marketing the performing arts. Boston: Harvard Business School.

National Apartment Association. (2011). The US apartment industry: Key federal issues. Washington: National Apartment Association.

National Apartment Association. Apartment industry careers. Web.

Wood, C. (2011). Apartment industry trends towards record rent growth. Web.

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"Marketing Plan for Apartment Complex to Increase Occupancies in South Carolina." IvyPanda, 16 Jan. 2020, ivypanda.com/essays/marketing-plan-for-apartment-complex-to-increase-occupancies-in-south-carolina/.

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IvyPanda. 2020. "Marketing Plan for Apartment Complex to Increase Occupancies in South Carolina." January 16, 2020. https://ivypanda.com/essays/marketing-plan-for-apartment-complex-to-increase-occupancies-in-south-carolina/.

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