A marketing mindset is severely lacking in the self-storage business. A marketing mindset is one that looks for clever and creative ways to maximize total profitability with a minimum amount of time and money. Self-storage owners and managers aren't generally a competitive sort. Many have the attitude "Let's just do our best" and are content to make a good living. There's nothing wrong with that, but what happened to the attitude "How can I do the absolute best I can?" Following are some problems hurting the marketing mindset of this industry and its overall profitability:
1. "My numbers are already good." Most storage operators, even those who don't do anything to improve their businesses, still make money. Many make money in spite of themselves. With decent numbers, why should an owner work to do better than he already is? After all, that would require some real work, which some storage operators are unwilling to do.
Making good money makes people complacent. This is human nature, and it is actually a blessing and a curse at the same time. If you weren't making a good living, you'd be busting your hump to make things better.
2. Competition is weak. The competition in most markets is weak and its marketing practices unintelligent. For most go-for-the-throat marketers, this would be an invitation to annihilate the competition. In self-storage, people tend to peacefully coexist with their competitors. Everyone wants to go to meetings together and make nice. Having competitors who are less than stellar marketers makes many storage operators relax and do little or nothing to really command the market.
3. Abdication of marketing responsibilities. Many owners feel someone else--usually their manager--is responsible for their facilities' marketing efforts. Nothing could be further from the truth. An owner's responsibility is not to look at the financials every month and try to decide where to take vacation that year. Marketing is the primary responsibility of the CEO of any operation. This is true, no matter how big or small an organization is.
Storage owners are often minimally involved in their businesses. This is true because for many, it is not their primary business. Whether or not it's your only business, you need to take responsibility for the marketing of your storage facility.
4. Lack of a competitive spirit. In working with storage owners, I see very little effort to truly maximize profitability and revenue. Sure, they claim to want to be the best, but very few are willing to do what it takes to make it happen. Very few storage owners play to win.
These four are the most blatant problems I see in the self-storage marketing mindset. There are more, but instead, let's concentrate on some solutions.
Learn, Learn, Learn
Many years ago, at a self-storage seminar, I approached one of the seminar leaders and asked him when he had last attended a seminar to improve his knowledge and skills. He couldn't even answer my question. This is absurd. If you are claiming to help and educate others in the industry, you had better be learning as much as you can yourself.
It's great to attend industry tradeshows. Talk to all of the speakers. Learn as much as you can. When it comes to learning about marketing, you should also attend other seminars and events in your area. Marketing is the future of this and every industry. As an owner, you should be learning as much as you can about it. You might want to consider buying an audio or video program on the topic--even if it isn't specifically related to storage. Why? You can take the ideas and modify them for use in this industry. That's marketing creativity. Finally, don't just attend tradeshows and other events and forget what you learned. Implement the ideas at your facility and put them into practice.
Find out which facilities in your area are making the most money and scrutinize what they do. See what you can adapt to use at your own facility. My senior quote from high school was "A wise man is he who knows he knows not." If you think you know it all, you're dead. Keep your mind open and be willing to challenge the status quo if it will improve your profitability.
The 5 Percent Rule
Take every aspect of your storage business and try to do it just 5 percent better. What would happen to your numbers if you could convince just 5 percent more people to visit your facility when you talk to them over the phone? What if you could get 5 percent more of the people who visit to sign a rental agreement? What if you could sell 5 percent more boxes and other ancillary products at your office?
If you were to concentrate on getting 5 percent better in a variety of different areas of your business, it would have a huge multiplier effect on your overall profitability. The results would be exponential. One owner who adopted this concept ended up making 30 percent more net profit the following year. This one idea was enough to make that happen.
You're Not in the Storage Business
Am I nuts? Have I gone off the deep end with this statement? I don't think so. Every storage owner I know is interested in making the most money he can--renting storage units just happens to be the vehicle. You're not in the storage business, you're in the profit-maximization business. I've heard owners dispute this fact, but it begs the question: What is your goal for your storage business? If your goal is not to make the greatest amount of money with the least investment of time, energy and resources, you're on the wrong track.
I'm surprised how often I hear that something other than revenue maximization is the goal of a storage operator. I even had one person tell me my marketing methods are "too aggressive." What does that mean? If I wasn't going to aggressively market my services, I'd get out of the business and sell flowers on the streets of San Francisco.
We're in business, folks; and in business, the goal is to make the most money possible. We should be thinking of how to maximize profit on a long-term basis. I've seen storage operators in a few areas create highly successful pack-and-ship businesses within their storage offices that created an additional net of $3,000 per month. Will this work everywhere? No. Will it work where you are? I don't know, but you should be thinking about it.
What About This One?
The average storage owner generates 2 percent of his gross sales from add-on products and services. These can be very profitable. I know one owner who demands his manager tell him everything a customer asks for that he doesn't already offer. A few years back, someone asked the manager where he could rent a carpet-cleaning machine. The manager took the comment to the owner and, the following day, he was offering carpet-cleaning machines for rent. After someone rents a machine four or five times, it pays for itself.
What an amazing concept: Listen to your customers and give them what they want. As storage operators, you have a lot of customers who know and like you (if you've treated them right). Why not offer them everything they need, rather than sending them somewhere else? Do this with any and everything you can manage. Use your head. What other ideas can you come up with?
I have two signs in my office. One reads: "Measurement Eliminates Argument." The other reads: "Upsell Everything."
You have to track your numbers to see how your facility is doing. Very few storage operators measure anything but the basics, but you need to measure exactly how many calls you get per month. You should also know exactly how many of those calls are converted into visits, and how many of those became renters. You'll also want to know exactly how many referrals you receive each month. These are just a few of the things you need to measure. When in doubt, keep the numbers. You will never kick yourself for having kept too much information about your marketing efforts.
When someone comes into your office for the first time, attempt to upsell by offering him a package of boxes. When people stop by the office, don't let them out the door until they've bought something. This is your highest margin sale: where someone intended to just buy this, but after your upsell, they also bought that.
When you run your storage business, don't be content to just make a decent living--I don't care if you're making $1 million a year. The question is, can you be making twice that amount?
Look at the storage business as a game, one you want to win, one where you get rewarded for squeezing every single drop of additional profit from your facility. Develop a marketing mindset and you'll not only make more money, but you'll have more fun. Be the best in your market area so, at the end of the day, you know you've done all you can to maximize your revenues and profits.
Fred Gleeck is a self-storage profit-maximization consultant who helps owners/operators during all phases of the business, from feasibility studies to creating an ongoing marketing plan. Mr. Gleeck is the author of Secrets of Self Storage Marketing Success--Revealed! as well as the producer of the only professional training videos on self-storage marketing. To receive a copy of his Seven-Day Self-Storage Marketing Course and storage marketing tips, send an e-mail to [email protected]. For more information, call 800.FGLEECK; e-mail [email protected].