Hospital or Hospitality - which is your Retirement Community business model?
It is widely accepted that Australian mature age consumers are not one homogenous group, and that segmentation by "age" as an indicator of consumer behaviour is at best ineffective, and generally misleading.
Before attempting to identify the niches and micro-niches within the Retirement Community marketplace, there is one major segmentation that must be clearly differentiated - the "needs" Vs the "wants" driven prospective residents.
Does your Retirement Community seek to attract mature age consumers who "need" to move into supportive retirement accommodation, or are you seeking to attract those who "want" to move from their current housing arrangements into the alternative you offer?
Based on this answer, your business model should take its lead from either best-practice Hospital or Hospitality operators.
If you aim to successfully attract residents who "want" to accept a change in their retirement accommodation, evaluate the way your facilities, your staff and your marketing, look and feel in comparison with a boutique hotel.
Do your employees seem more suited to healthcare or hospitality?
If you were in charge of that boutique hotel, how many of your current staff would you employ? Are they hospitable enough?
As a hotel guest, would you happily accept the restrictions and regulations you see as necessary for your Retirement Community?
A major segmentation question is - Can you care too much?
In the aged care industry, it is appropriate that the extent and style of care dominates their marketing efforts, and the competitive advantage they articulate.
However, the market positioning in the Retirement Community industry also strongly emphasises their level of resident care, both "caring for" and "caring about" their residents.
If your business model targets the "wants" driven prospect, the community environment you are striving to create would encourage residents' independence and self-sufficiency.
Will staff members who were chosen for their ability, and desire, to take care of residents, stifle that feeling of independence and thriving?
A quick comparison with US operators.
One major aspect that pervades the marketing by US operators in all product and service categories is their propensity to target a specific niche.
US Retirement Communities commonly target a single ethnic, religious or sporting group, or the gay and lesbian market, or ranch-based communities for old cowboys, often erroneously dismissed by Australian marketers as being solely a result of the US population, and therefore not viable locally.
Certainly there is no confusion deciding whether a US community is targeting needs or wants driven prospective residents.
By comparison, Australian operators seem reluctant to clearly nominate their target as either the needs or wants, and to carry through that decision in all aspects of their business model - most importantly, the selection of residents within their sales process.
Most incongruous are Australian communities, where a very expensive facility has been specified and constructed to perfectly reflect the desires of the wants prospect, but then through fear of losing sales opportunities, the operator accepts a percentage of needs residents and must therefore staff and operate the facility in line with the requirements of the highest need, thus changing the environment necessary to attract the wants prospect.
The Internet Influence
If the market position of your Retirement Community is to appeal to anyone and everyone over 55, it is near impossible to choose the words in traditional media to convey that message, and more so the keywords to successfully attract the attention of internet search engines.
How to identify your niche
To identify the niche, or micro-niche, which contains the highest proportion of targeted mature age consumers, we have created the Mature Marketing Matrix, which recognises 6 Categories of Influence on their consumer behaviour, and 6 Segments within each Category.
The 6 Categories of Influence are
- Age
- Family Commitments
- Financial Position
- Health and Mobility
- Lifestyle
- Work Status
As an example of Segments, the Family Commitments Category has Segments such as "Single - no dependents" up to "Couple - with carer responsibility."
The Work Status Category has Segments ranging from "Fully Retired - no paid or unpaid work" up to "Self Employed - exceeding financial needs."
The Take-Away.
Australian Retirement Community operators seem to agree on the different requirements to successfully attract and service the needs driven resident, as opposed to the wants driven.
Within industry circles, discussions on the percentage of needs versus wants driven prospects are frequent, and usually contain common understanding on the varying market demands, particularly relating to facilities and staffing.
However, when it comes to executing a business plan which unequivocally nominates, internally and externally, whether they seek to operate within the needs or wants driven marketplace, too often it appears a "foot in both camps" is the default middle ground.
Market evidence suggests the safety of that middle ground brings with it a guarantee of mediocrity and not the "best of both worlds".
Written by Graeme T. Smith
Managing Principal, SeniorCoach.biz
May 2010
