Self-Storage: A Complex Market?
|Copyright 2014 by Virgo Publishing.|
|By: Harley Rolfe|
|Posted on: 03/01/2001|
WANTED:A silver bullet to smite the competition
By Harley Rolfe
Self-storage owners tell me they are increasingly vexed by competition, and they think marketing will help. So, I tell them about step one in creating a sound marketing program: Study your tenant base. At this point, their eyes glaze over. They have a real problem, and they are willing to pay for help, but they want something fast and easy. They want a set of marketing "tricks" that will wipe out the competition. But nothing is that simple.
How do you conduct a "hard-nosed" marketing program? Easy. Know more about what users are looking for than your competition. Create a unique solution to their problems and get the word out. Note that step one is gaining knowledge. For example, successful athletes or sports teams study their opponents to antipate how they will behave during a game. Similarly, a good politician researches the issues and figures out a program to meet voter preferences.
Marketing is no different. You already have a head start--you have a facility full of tenants who have already "voted" in your favor. You have the advantage of being able to ask and find out from paying customers what they want and need. And there's another benefit: After you speak with your customers, you now have a repertoire of interesting stories and endorsements to illustrate and reinforce your marketing claims.
A marketing program is no better than its underlying research. That's your foundation, and it will vary segment by segment. Until you identify your prospective tenants and determine their specific needs, you're flying blind.
Self-Storage: A Complex Market?
Some see the simplicity of the self-storage product and assume the self-storage market is equally uncomplicated. But keeping in mind that markets or segments really represent different uses of the product, they are more varied and, therefore, complex. There are personal and business uses, with dozens of applications in each. You really don't know your market until you know all the uses to which your facility is being put. You must know what need or use each prospect has, and target your appeal to that. A "come one, come all" philosophy doesn't work in an aggressive market.
Divide and Conquer
In determining the right marketing approach, you must first survey your current and vacated tenant base. Compose a questionnaire to determine how those tenants came to you. The main question is, what caused each tenant to need and obtain a storage unit? You need to learn how to be there when a need for your service arises. Don't always wait for tenants to come to you.
For example, when someone purchases a new home, there is an immediate possibility that he will need storage. Aim your marketing at that crucial moment. But first, there is some basic information you will need:
These are some of the insights that begin to guide your approach. We know there are two major classes of users: personal and commercial. We also know the occupancy term for each is quite different. Why? Changes or events in a person's life generate personal uses--a new home, divorce, job transfer, etc. These are transient occurrences. The use of the facility ends when the occasion ends, so it's only temporary. Business applications are likely to be more permanent if woven into the operations of the enterprise. These differences should be recognized in the way we plan, price and offer our services.
Self-Storage Marketers Lament
I continue to be disappointed that the Self Storage Association has not studied and established definitions for the basic market segments. The SSA seems all too willing to encourage developers to build new facilities, but devotes little effort to reducing the woe this added capacity causes existing sites. There should be a catalog available to identify the various market segments (and there are probably hundreds). Operators could then match up their own market patterns with the master list, permitting them to draw comparisons between and within geographical areas. Current operators shouldn't be faced with doing this groundwork.
Because of the lack of shared market definitions, facilities inevitably create a mish-mash of data. That data is useful to the individual facility, but is not comparable to anything else. The SSA should help increase the size of the self-storage "pie," making room for added unit capacity. Many associations are right in there pitching for their members. But the SSA has been passive toward marketing needs, and many of today's operators cannot sit tight. The market won't wait. I urge you to press the SSA to help you meet your marketing challenges by at least categorizing the possible uses and characteristics of self-storage.
Is This Trip Really Necessary?
There are some who doubt the need to do all this basic homework. But the efficacy of any marketing effort is a function of the underlying research you have done. It's the foundation of your program. Without it, you are just guessing about who is using your facility and why. Once you've collected that initial data, keep in mind that it will get dated, so you should ask each new tenant about his particular application. This will keep your database fresh and create opportunities to uncover trends and niches.
Many owners got into the self-storage industry because it didn't seem to require sophisticated management. After site selection, financing and construction, it seemed the owner need only take an ad in the Yellow Pages and perform the housekeeping duties and good things would happen. But competition changes things. When marketplace combat breaks out, detailed knowledge of your tenant based is more than necessary knowledge--it's your ammunition.
Missed some previous issues? Check the web at www.hardnosed.com.
Harley Rolfe is a semi-retired marketing specialist whose career includes executive-level marketing positions with General Electric and AT&T. He also owned lodging and office facilities for more than 20 years. Mr. Rolfe holds a bachelor's degree in economics from Wabash College and a master's degree in business administration from the University of Indiana. He can be reached at his home in Nampa, Idaho, at 208.463.9039. Further information can also be found in Mr. Harley's book, Hard-Nosed Marketing for Self-Storage.