COVID YEAR
IN REVIEW

COVID YEAR IN REVIEW

Introduction

Twenty-twenty was the year that threw all marketing benchmarks out of the window, tried and tested marketing methods that had not only worked but were expected by the audience suddenly became ineffective. This led to a new audience, essentially customers that didn’t know what they wanted or when they wanted it. As a community marketers had to re-learn how to communicate with their uncertain audience, to fill them with confidence. Marketing became less about the amazing product you were selling and more about the values of the company selling the product.

Reactive marketing is never the ideal, but by using REAL’s tracked data from the last 24 months we were able to short term forecast and adapt our messages accordingly.

We involved customers in the conversation, talking to them about mental wellbeing, how they were finding home studying and what new digital behaviours they had taken on.

In this new covid world, marketing is not about competing with competitors its more about competing against the last best experience your customers had and putting your values at the heart of the message.

First Month vs Last Month

Overall, from one year to the next we would expect to see an increase in prices due to indexation. Nationally we can see this happening, however the average increases are relatively incremental, and an increase is not necessarily the case when we look at individual cities or university stock.

Some notable examples can be seen in Birmingham and Sheffield where University stock rental prices are much lower than this time last year across all room types. In Sheffield PBSA studios and en-suites are tracking behind the start of the first lockdown and in Newcastle non en-suites are also tracking behind the start of the first lockdown.

The first national lockdown went into effect in March 2020, and the market has seen instability throughout the following months if not the rest of the year. Nationally rents saw three periods of universal decreases across the board in April, June, and September (2020).

The April decrease could be attributed to the stalling market in response to the national lockdown. The June decreases coincide with the start of what seems to be the most active sales period during the lockdown. The September decreases most likely occur as the market has failed to sell and become a more competitive market.

INCENTIVES

The most commonly used and typical incentives nationally are Cashback and Refer a friend offers. The amounts typically vary by city and depending on how saturated the market is. We have tracked incentives and have found that both offers increased significantly over the course of the last year. In March 2020 both Cashback and Refer a friend offers were at their lowest value starting at just £50 for each offer. In this first month of the first lockdown Cashback ranged from £50 up to £600, whereas Refer a friend ranged from £50 to £200. Throughout the rest of the year these offers grew in the increasingly competitive market, with Cashback offers increasing the minimum amount to £100 and the maximum up to £2500. Refer a friend offers also increased during this time to see minimums of £75 and maximums of £1000.

Whilst Cashback and Refer a friend are the staple incentive offerings, there are also more unique offers available, which during Covid also saw an increase in value. At the start of the first lockdown, offers such as small prize draws were offered, but as the year progressed, offers such as tech bundles and free bikes for every booking became common place. Some of the most popular new unique offers during this time were offers such as 20% off annual rent for NHS students, free summer stays, free quarantine stays and significantly, the acceptance of international guarantors.

5.1%

At this point in time student accommodation nationally was around 5.1% sold out

March marked the start of a very trying year for student accommodation. The first lockdown was officially announced on the 23rd of March 2020, however, there was speculation in the weeks leading up to this date that this would be happening.

Naturally, the attention of the country was drawn to this very serious and pressing issue. Essentially life was put on pause to deal with the pandemic. University campuses around the country closed and switched to a model of remote learning. Leading many students to be uncertain over their future in academia. Switching to remote learning meant that looking for accommodation became much lower on a student’s priority list.

Leeds was the furthest ahead of our spotlight cities in terms of rooms sold out with 13.06% of rooms sold out by the end of March.Birmingham was the furthest behind of our spotlight cities in terms of rooms sold outs with just 1.47% of all rooms being sold out by the end of March.

The two most prolific incentives offered are Cashback and Refer a Friend. March saw Cashback at a minimum of £50 and a maximum of £600 and Refer a Friend at a minimum of £50 and a maximum of £200.Some of the more unique incentives this month included prize draws where 1 person had a chance to win rent-free for a year upon making a booking.

2.79%

At this point in time student accommodation nationally was around 2.79% sold out. This is less than the previous month and highlights the number of students cancelling their bookings.

2.79%

April was the first full month in the first lockdown, and the country has had one week to get accustomed to what would widely become the “new normal”.

Social distancing is now commonplace, and the general public are being advised to stay at home with only essential travel permitted. In general, nationally rents for PBSA fell while rents for University stock increased. However, PBSA has historically been more reactive to market shifts, which can be seen in the following month where University stock rents universally decrease.

Nottingham was the furthest ahead of our spotlight cities in terms of rooms sold out for April with 19.78% of rooms sold out.Manchester was the furthest behind of our spotlight cities in terms of sold outs for April with just 1.51% of rooms sold out. A point of interest: Leeds was ahead in our spotlight cities during March, however this month it has seen a large drop in rooms sold out, dropping from 13.06% in March to just 2.78% in April.

The two main incentives offered are Cashback and Refer a Friend. April saw Cashback at a minimum of £50 and a maximum of £1000 and Refer a Friend at a minimum of £100 and a maximum of £500. Which is an increase on the previous month.One of the more unique incentives this month is a monthly prize draw where a student can win a prize each month when they book. April also saw the introduction of delayed tenancy start dates with students offered options to either reduce their tenancy or extend their tenancy into summer 2021.

2.94%

At this point in time student accommodation nationally was around 2.94% sold out.

May sees the second full month of lockdown, with the Prime Minister announcing lockdown would not be eased until 5 key measures have been met.

However, light was at the end of the tunnel and a 3-stage easing of lockdown was in sight beginning on the 1st of June.

Nottingham was the furthest ahead of our spotlight cities in terms of rooms sold out for May with 36.29% of rooms sold out.Cardiff was the furthest behind of our spotlight cities in terms of rooms sold out for May with just 1.40% of rooms sold out

The two most prolific incentives offered are Cashback and Refer a Friend. May saw Cashback at a minimum of £50 and a maximum of £1000 and Refer a Friend at a minimum of £50 and a maximum of £250. This is an increase on the previous month.Some of the more unique incentives for May include a double discount prize draw where a student could win double the usual discount when they book a room. Other unique incentives include a free bike and free summer stays.

38.89%

At this point in time student accommodation nationally was around 34.89% sold out, a large increase from the 2.94% in May.

38.89%

In June, the Prime Minister held a press conference announcing the number of people with Covid-19 had fallen from 69,000 in May to 22,000 in June.

Subsequently, it was announced that the 2-meter social distancing rule would be lowered to 1 meter and that any 2 households would be allowed to mix both outside and inside. For student accommodation, this news has had a significant impact on booking levels nationally. At this point in time student accommodation nationally was around 34.89% sold out, a large increase from 2.94% in May.

Nottingham was the furthest ahead of our spotlight cities in terms of rooms sold out for June with 53.05% of rooms sold out.

Birmingham was the furthest behind of our spotlight cities in terms of rooms sold out for June with just 24.77% of rooms sold out, however, Newcastle was a close second with 26.82% of rooms being sold out.

The two main incentives offered are Cash Back and Refer a Friend. June saw Cash Back at a minimum of £50 and a maximum of £1000 and Refer a Friend at a minimum of £50 and a maximum of £200.

Unique incentives this month are similar to last months with the addition of a smaller easier to obtain the incentive. This incentive required the student to book a virtual show flat viewing in order to “unlock” an amazon movie/book worth £5.

39.5%

Nationally at this point in time student accommodation was around 39.5% sold out. This is an increase over the previous month; however, it is a relatively small increase, especially when compared to the increase from May 2020 to June 2020.

July saw the most prolific reduction in restrictions granted since the first lockdown came into effect, however, further freeing up of restrictions was put on hold.

During a press conference with the Prime Minister, it was announced that Covid-19 infections were gaining pace in other countries and it was highly likely to do the same in the UK. The Prime minister announce that he was therefore cancelling planned opening of certain high-risk venues and sports events. If June was the catalyst for bookings to begin then July seems to have become an obstacle to bookings.

Nottingham was the furthest ahead of our spotlight cities in terms of rooms sold out for July with 61.17% of rooms sold out.

Birmingham was the furthest behind of our spotlight cities in terms of rooms sold out for July with just 24.29% of rooms sold out, this is a reduction from June where 24.77% of rooms had sold out.

The two main incentives offered are Cashback and Refer a Friend. July saw Cashback at a minimum of £50 and a maximum of £1000 and Refer a Friend at a minimum of £50 and a maximum of £500. This is an increase over the previous month’s incentive offerings.

With the boost in bookings for June and the stall in July, unique incentives in July became more competitive. Incentives such as VIP tech bundles where students would receive a package of technological items such as Amazon Alexa devices and games consoles etc upon booking a room start to become more popular this month. July also saw the introduction of 20% off for NHS students, an offer that would become very popular with operators in the following months.

41.42%

Nationally at this point in time student accommodation was around 41.42% sold out. This is an increase over the previous month; however, it is again a small increase compared to the large jump in bookings seen in June 2020.

41.42%

August is a critical month for prospective university students as this is when they receive their A-level results. In a typical year, the student would complete their exams and then receive their results in August.

However, August 2020 told a different story with students unable to sit their final exams, and as a result were given predicted grades. Further complicating the issue, some students were given grades that were lower than what they expected due to errors in the algorithm used to predict grades. As a result, many students were rejected from their chosen universities. This will have undoubtedly delayed many students in looking at the accommodation that would ultimately become their preference, whilst they looked to rectify the grades they had been given.

Nottingham was the furthest ahead of our spotlight cities in terms of rooms sold out for August with 53.96% of rooms sold out, down from 61.17% in July.

Southampton was the furthest behind of our spotlight cities in terms of rooms sold out for August with just 34.76% of rooms sold out. However, Birmingham and Manchester were a close 2nd and 3rd from the bottom with 34.81% and 34.94% respectively.

The two main incentives offered are Cashback and Refer a Friend. August saw Cashback at a minimum of £50 and a maximum of £1000 and Refer a Friend at a minimum of £50 and a maximum of £500.

Unique incentives this month still include tech bundles and NHS 20% off discounts from July, however, this month sees the popularity of free summer stays and free quarantine stays amongst operators.

41.39%

Nationally at this point in time student accommodation was around 41.39% sold out. This is a small decrease over the previous month.

September saw another month of diminished freedom with the introduction of the “rule of 6”, where only 6 people would be allowed to gather together in a social setting.

September is usually the month students either start or return to university, however with the numbers of Covid-19 infections increasing and the amount of freedom and movement decreasing many universities had to decide on whether to allow student to return to campus or whether to continue doing distance learning. The amount of uncertainty leading up to this decision was widely publicised and is likely to have had many students hanging on until the last minute when deciding to book their student accommodation.

Eventually, many universities pushed the start of the academic year back to October 2020. September is also usually the last point in which operators can sell rooms as tenants will normally be in situation by the end of the month. However, as with many things during Covid, the rules on this also changed and students were booking well after September.

Nottingham was the furthest ahead of our spotlight cities in terms of rooms sold out for September with 55.78% of rooms sold out.

Southampton was the furthest behind of our spotlight cities in terms of rooms sold out for September with just 30.5% of rooms sold out.

The two main incentives offered are Cash Back and Refer a Friend. September saw Cash Back at a minimum of £50 and a maximum of £1000 and Refer a Friend at a minimum of £75 and a maximum of £500. This is a slight increase over the previous month.

Unique incentives this month include many of the previously mentioned incentives with the addition of flexible check-ins, book a personal video tour to get £100 cashback, and operators willing to match competitor Incentives.

42.09%

Nationally at this point in time student accommodation was around 42.09% sold out. This is a small increase over the previous month.

42.09%

Students were due to either start or start back at university in September, however universities had pushed the start dates back to October to get a better grasp on what direction to take given the increasingly strict Government restrictions being put in place. Ultimately most universities decided to go with a blended learning approach where most students would utilise online learning functionality and only students who needed to be taught on campus would be allowed on campus.

October saw bookings increase slightly compared to September as a few more students booked during this time. Normally during the PBSA booking cycle October tends to be a quiet month where operators take the opportunity to remove old rents and campaigns in order to strongly launch the new rents for the next academic cycle. However, many operators achieved much lower occupancy levels compared to what had been forecast prior to Covid taking over the country. As a result, the 2019-20 letting cycle continued for much longer while some operators tried to boost occupancy levels on the delayed cycle rather than launching cleanly into the news cycle.

Nottingham was the furthest ahead of our spotlight cities in terms of rooms sold out for October with 57.39% of rooms sold out.

Southampton was the furthest behind of our spotlight cities in terms of rooms sold out for October with just 32.89% of rooms sold out.

The two main incentives offered are Cashback and Refer a Friend. October saw Cashback at a minimum of £100 and a maximum of £1000 and Refer a Friend at a minimum of £50 and a maximum of £1000. This is a small decrease over the previous month.

Unique incentives this month include rephrasing of refer a friend offers to sound more appealing – “Refer your friends and earn £1000’s”. Other offers remain such as discounts for medical/NHS students, tech bundles, spin to win a prize, deal match and international guarantors.

21.36%

Nationally at this point in time student accommodation was around 41.39% sold out. This is a small decrease over the previous month.

November saw the start of the second Covid-19 lockdown, which was announced as a limited 4-week measure to combat the rising cases of Covid-19. However, despite there being a national lockdown, Universities were allowed to remain open. With universities being open and many students studying remotely, many operators chose to leave bookings open for the 2020/2021 term.

Therefore, during November there was a mixture of operators who were showing rooms solely for the 21/22 period and operators who were showing both 20/21 and 21/22. This provided both a more confusing booking process for students and a complex picture of which operators had sold out for 21/22 and which had sold out for 20/21.

Newcastle was the furthest ahead of our spotlight cities in terms of rooms sold out for November with 40.3% of rooms sold out.

Manchester was the furthest behind of our spotlight cities in terms of rooms sold out for November with just 12.76% of rooms sold out.

The two main incentives offered are Cashback and Refer a Friend. November saw Cashback at a minimum of £100 and a maximum of £1000 and Refer a Friend at a minimum of £50 and a maximum of £1000.

Unique incentives this month largely mirror the previous month. Additional offers such as free international student welcome packs are commonplace this month.

6.42%

Nationally at this point in time student accommodation was around 6.42% sold out, down from 21.36% in November. However, 6.42% is indicative of a more typical market.

6.42%

In December, the government announced that the population would be allowed to form Christmas bubbles and spend time together. Universities and accommodation providers, therefore, devised safe and practical plans for students to travel home to be with their family, to then return in January. However, leading up to Christmas, the stats around Covid-19 became worse and the government had to drastically reduce the proposed holiday plans. At the time students were leaving their accommodation, many did so outside of the safe and practical plans that had been drawn up.

December was a major turning point for many operators. The majority of those who had continued to sell rooms for the 20/21 cycle had now started to focus solely on the 21/22 cycle. This is around 2 to 3 months after what would normally be the case. This is also reflected in the drop in the percentage of sold-out rooms this month.

Edinburgh was the furthest ahead of our spotlight cities in terms of rooms sold out for December with 10.2% of rooms sold out.

Manchester and Southampton were the furthest behind of our spotlight cities in terms of rooms sold out for December with both achieving just 1.91% of all rooms sold out.

The two main incentives offered are Cashback and Refer a Friend. December saw Cashback at a minimum of £100 and a maximum of £2500 and Refer a Friend at a minimum of £50 and a maximum of £500. This is a relatively large increase for Cashback and also a relatively large decrease for Refer a Friend.

Unique incentives this month have reduced in volume, offers such as 20% off for NHS students are common. In addition to this, some cash back offers have been reworded to seems like a bigger cash back amount – “Book as a group of 8 and receive £2500 cash back”.

6.78%

Nationally at this point in time student accommodation was around 6.78% sold out. This is a small increase over the previous month.

January saw the start of the third national lockdown since the pandemic began. Schools and universities were to close, and the general public were told to stay at home unless it was absolutely necessary to leave home. Students who were already in their accommodation were advised to stay in the situation.

The level of sold-out rooms stayed low with only a small increase in the numbers of bookings.

January also saw the January UCAS applicant data release which indicated that the number of students had increased by a relatively high 8.45% year on year. The previous year’s saw increases of 1.23% and 0.43% respectively.

Newcastle was the furthest ahead of our spotlight cities in terms of rooms sold out for November with 40.3% of rooms sold out.

Manchester was the furthest behind of our spotlight cities in terms of rooms sold out for November with just 12.76% of rooms sold out.

The two main incentives offered are Cashback and Refer a Friend. January saw Cashback at a minimum of £50 and a maximum of £750 and Refer a Friend at a minimum of £50 and a maximum of £200. This is a decrease over the previous month for both offers.

The main unique incentives this month are the acceptance of international guarantors and 20% discounts for NHS students.

7.83%

Nationally at this point in time student accommodation was around 7.83% sold out. This is an increase over the previous month.

7.83%

February saw a month of good news from the Prime Minister, with the announcement of a roadmap to release lockdown for hopefully the final time with nearly all legal restrictions removed by the 21st of June 2021.

February was also the month the Prime Minister pledged that every adult in the UK will be vaccinated by July 2021. When taken together this provides students with a very confident outlook that the 21/22 academic cycle will be restriction-free. This will likely have a big impact in the following months with similar jumps in booking levels that were seen in June 2020 when restrictions were eased.

Edinburgh was the furthest ahead of our spotlight cities in terms of rooms sold out for February with 11.16% of rooms sold out.

Cardiff was the furthest behind of our spotlight cities in terms of rooms sold out for February achieving just 2.6% of all rooms sold out.

The two main incentives offered are Cashback and Refer a Friend. February saw Cashback at a minimum of £100 and a maximum of £2500 and Refer a Friend at a minimum of £50 and a maximum of £200. This is a large increase for Cashback offers over the previous month.

Unique incentives still include a strong push on discounts for NHS students. Other unique incentives include rewording cashback offers to show a larger amount for groups – “Book as a group of 8 and receive £2500 cashback”.

Over the last year, incentives have increased to match the difficulty in the market. Cashback saw a 100% increase in the minimum amount offered and 317% of the maximum amount over the year. Refer a friend saw a 100% increase in the minimum amount offered and 400% of the maximum amount over the year.

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