Self-Storage Operators Go Fish: Change Your Marketing Philosophy and Create Demand for Your Product
|Copyright 2014 by Virgo Publishing.|
|Posted on: 09/08/2010|
By Randy Smith
How’s business in your neck of the woods? Hasn’t been so great, you say? Well, let me throw out a controversial statement: Business would be a whole lot better if you started creating demand for self-storage. Here’s my contrarian view on how to increase your occupancy and revenue in any economy, especially this one.
At Another Closet Self-Storage in Texas, our business is doing great and getting better every day. How? Our approach to marketing is all about “creating demand” for self-storage.
Another Closet owns and operates multiple locations in South Texas, totaling more than 612,000 net rentable square feet, with plans to add another 150,000 square feet in the next six to 18 months. I believe that by hiring great people, providing excellent training and employing several unique marketing strategies in our market, we’ve been able to create demand for self-storage and prosper, even in this economy.
Some quick stats: The last quarter of 2008 was our best of that year. Gross revenue in 2009 was up 18.6 percent over 2008. Actual revenue for 2010 is up 15 percent over 2009 at properties with stabilized occupancy. Occupancy and rents are up at all locations. Our newest location, a 54,000-square-foot facility, is 40 percent occupied in just 75 days from the grand opening. But we’re in no bubble. We’re experiencing the recession like everyone else, except we’re not participating!
Determining the Need for Storage
If you’ve been in the self-storage business for more than 10 minutes, you’ve probably someone say, “You can’t create demand for self-storage. People either need it or they don’t.” Erase that belief from your mind! That mentality has cost the self-storage industry billions of dollars over the last 20 or so years.
The problem with the “they need it or they don’t” philosophy is who’s determining the need. With this mindset, the customer determines the need and the self-storage operator waits around until the customer figures it out. That approach is like taking your boat into the middle of the lake and waiting for fish to jump into it.
Another problem with this frame of mind is the word “need” means different things to different people. It’s a nebulous term you can’t pin down. You have people renting from you right now who don’t need storage. Some of your customers renting 5-by-10 units are homeowners with garages. They don’t really need the unit because they already have enough space. The issue is whether they want to cram all that stuff in their home and garage.
I’ve heard some industry experts say, “No one gets into their car, drives down to Self-Storage Avenue and just rents a unit on a whim.” True, but just because self-storage isn’t an impulse purchase doesn’t mean you can’t create demand for it. Others have compared the self-storage business to the funeral-home industry: People don’t come see us until they need us, but when they do, they usually need us pretty badly.
Let’s not just wait for customers to show up due to an obvious and pressing need. Let’s educate them about 101 great reasons why they need a storage unit now.
Steps to Create Demand
Let me introduce a new “mantra” for self-storage operators: “Everybody needs a self-storage unit, and it’s my job to convince them why.” Do you want to build demand for self-storage? Here are some suggestions for creating it in your neighborhood:
Change your mindset. Rid yourself and your organization of the philosophy that says you cannot create demand for self-storage. Almost every other industry spends billions of dollars annually to actively create demand for their products and services. Why not self-storage too?
Change your advertising. Never use the phrases, “Do you need storage?” or “When you need storage…” Your whole advertising message should be “You need storage!” You tell them they need it.
Provide a solution. Couple the “you need storage” message with “and here’s why.” Tell them how they’ll benefit tremendously by storing with you. Remember, you’re throwing out an enticing lure, not waiting for fish to jump in the boat.
Educate your audience. Your job is to educate the public specifically on how they can use self-storage to improve their quality of life. Most ads for self-storage are focused on the business and not the benefit to the consumer. The benefit of self-storage needs to be bigger to the consumer than the loss of dollars to pay for rent.
Re-evaluate your advertising. Newspaper and Yellow Pages ads are now highly ineffective. Slash those forms of advertising and go heavy on radio. You can get hundreds of times the exposure from a 30-second radio ad or TV commercial than from a Yellow Pages ad. Two or three well-placed spots a day during the drive to or from work can increase your business dramatically. It’s the best medium for educating consumers and creating demand.
Look at creating demand like the process of fishing. It won’t happen overnight, but you can grow your self-storage business substantially over time. Fishermen get up early, stay out late, and fish in every kind of weather. They’re always switching bait and moving around the lake in search of a catch. They don’t wait for the fish to come to them. They don’t build relationships with people who know the fish and hope they refer the fish to them. They go fish. They educate themselves on fish behavior and become experts on what appeals to fish—what makes them bite! Then they spend their days and nights out on the water creatively enticing the fish with everything they’ve got.
As you educate yourself on local consumer behavior, you can tune in to what appeals to the “fish” in your neighborhood. If you make your message logical and enticing, they can’t but help bite. That’s creating demand. You can rent more units and make more money than your competitors if you believe and practice creating demand for self-storage. Remember you’re new mantra: “Everybody needs a self-storage unit, and it’s my job to convince them why.”
Randy Smith came to the self-storage industry nearly a decade ago with close to a dozen years of prior sales and management experience. He has managed Another Closet Self Storage in McAllen, Texas, for the past eight years. To reach him, e-mail firstname.lastname@example.org.