It's not hard to get a self-storage operator to agree he must distinguish his product if he is to avoid debilitating price competition. That leads to a conversation about his exclusive offerings. Location generally leads the list--and it's worthy, given tenants' general preference for a proximate site. The owner's confidence is justified only until another facility opens nearby. Then what happens?

Three Options

You must be ready to present your facility to the market in a way that differentiates it from others. The prospect must see you as different--and, hopefully, better. If you are perceived as the same as others, you will be subjected to price competition, or "shopping." While some would have you believe marketing is complicated, it is not. You must provide the prospect with a unique reason to decide in your favor. That's it. All the rest is aimed at implementation.

When competing, business owners have only three possible options. Option one: You control the supply. In self-storage, that would mean being the only facility in your market. That is the basis of success for many facilities, and it is the approach that is increasingly coming under assault. Your second option is to compete on price, which is really competing on cost. If you don't have a unique cost advantage, you are just throwing your net margin at the situation--which isn't much of a long-term strategy. Your final option is to distinguish your offering from that of rivals through innovation, positioning or packaging.

The reason the government is so gung-ho about competition is it provides the automatic stimulus for improvement in the provision of goods and services. The social purpose of competition is to spur the supplier to do things he would not do otherwise--in favor of the consumer.

A competitive market forces suppliers to provide the lowest prices and guarantees a steady flow of new products and services. But take note: Those suppliers don't introduce new things for the good of society. They do it to create a unique offering, permitting them to take back control of their pricing. That works until a rival is able to duplicate the new feature, removing its uniqueness and resetting the shopping cycle. What some commentators describe as a dynamic economy is really the ongoing struggle of suppliers to escape price competition through the steady introduction of unique offerings. When rivals show up in self-storage, these forces enter your life.

While a dynamic economy may be good for society, it is not necessarily good for suppliers. There is nothing good about being forced to sell your wares at less than a fair price; and there is nothing desirable about being forced to unnecessarily, but regularly, retool the product offering. The process is costly and prone to errors--yet absolutely necessary in a competitive market.

That Choking Sound

I usually address my comments to self-storage owners because it takes an entrepreneur to make these choices of strategy. The first two options don't take much marketing. But when the choice is to subdue the effects of competition through differentiation, the story changes. Many owners don't know enough about marketing to fully understand what this choice entails. They only understand the need to secure their position in a strongly competitive market.

It may be their first brush with formal marketing. I frequently hear that choking sound an owner makes, in shock at discovering the amount of preparation needed to direct a sound marketing program. Most of them know media is an important part of a marketing effort. What surprises them is when they are told media is the least important and last step.

Any decent marketer will not spend media money without research. That means careful identification of segments and uncovering the significance of self-storage to each. It also means pinpointing an offering specific to the needs of each--in other words, a plan. When I explain this to self-storage owners, they generally ask if all of this is really necessary.

A Complete Solution

Central to the success of a marketing approach is for the operator to accept that, in most cases, storage is just one component of solution for a prospect, and it may be secondary. As a marketer, you want to know what event occurred that induces the need for storage. You need to know this so you can "be there" for the prospect when that event takes place.

For example, a prospect moves to a new home. When does that event take place? That's simple: When he signs the contract on the new property. That is his cue to start thinking about how he is going to get from here to there. His primary thought is transportation. Ideally, he would like to move his stuff from the old to the new home in one step. Sometimes that can't happen, and he needs the interim step of storage. Does that make him a happy camper? No. It involves double handling and loading, extra expense--none of which is enticing. Only reluctantly does he concede that he needs storage. It is not central to his purpose.

Storage, in this case, is just one part of the prospect's solution. But a solid marketing plan can equip a self-storage owner to address more than the one component. It may cause him to redefine his business. For the prospect to achieve his end, he needs a truck, movers, packing supplies, storage, etc. The question is, who will assist him with all this? If the prospect has to organize these tasks separately, you are regarded as just one component, a commodity. What marketers know is a competitive advantage and convenience premium await those self-storage owners who offer a complete solution.

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. Rolfe's book, Hard-Nosed Marketing for Self-Storage.