Self-storage operators arent the only ones searching for an untapped market in todays competitive environment. Companies like Ford, Wells Fargo, IBM and Hewlett-Packard have begun wooing the countrys exploding Hispanic population. Could the Latino market be a potential bonanza for self-storage?
Its a great opportunity for those in the industry who are savvy enough to see the writing on the wall, says Shelly Little, consultant with Michaels/Wilder Group, a marketing and advertising agency based in Peoria, Ariz. All the data points to a trend that says this market isnt going away and is growing exponentially. Yet Hispanics are historically under-advertised to. If companies move forward and reach out to them, their efforts will be rewarded in the long run.
The number of Hispanics living in the United States is growing fantastically. From 1990 to 2000 alone, it increased 35 percent. The U.S. Census Bureau estimates about 14 percent of U.S. residents are Hispanic.
Self-storage should court Latino customers while they are getting established in the United States, advises Little. To overlook this market while it is in its infancy is not playing smart. Down the line, Hispanics will remember those businesses that were there for them when they needed a place to store their important personal and business goods, she says. Theoretically, the move will be repaid with long-term loyalty and numerous referrals.
Just as important to the self-storage equation is the market segments corresponding growth in wealth and homeownership. More than half of Latinos in the United States will own their own homes by 2007, according to a recent estimate by Hispanic Market Weekly. The populace also is gaining in disposable income. The fact that Hispanic families are typically larger than in non-Hispanic households is another telling factor.
While renting or transitioning to homeownership, they will need somewhere to store the valuables they accumulate, Little says. The changes in lifestyle that result from the increased disposable income and growth in families translates into many opportunities for the self-storage industry.
Little counsels owners to evaluate the demographics in their current markets. Is the Latino population substantial? What is the competition doing? Investors may want to investigate the feasibility of a new facility catering to densely Hispanic areas. Also look at the type of Spanish being usedis it Cuban, Mexican, Caribbean or Puerto Rican? Before proceeding, its wise to hire a consultant or agency with expertise in working with the Latino market.
In reaching out to Hispanics, language is a major consideration. Most Latinos are understandably more comfortable conducting business in their native tongue. Although many are bilingual, they prefer to read material and converse in Spanish unless they were born and bred in the USA, Little says. Having a manager who is bilingual is really helpful. You are breaking down the barriers that make it more challenging for them to do business with you.
Because self-storage isnt widely available outside the United States, the concept will be new to some Hispanics. A bilingual manager can go a long way in enhancing their comfort level during inquiries. I think there are also issues regarding self-storage organizations not having the infrastructure in place to support the Spanish-speaking customer, Little says. All their collateral, invoices, bills, everything should be set up in Spanish.
Culture may impact the business transaction as well. A prepared operator/manager will be flexible enough to adapt. There are several segments within the U.S. Hispanic market that are used to dealing primarily in cash, Little explains. In their country, it was cash; you did not use a credit card. They may not have a bank, a bank account or a way to check credit because credit wasnt available in the country they came from. Business owners should be sensitive to this and prepared to handle it.
Se Habla Whoopsie-Daisy
Watch out for common pitfalls when targeting the Hispanic market. Failing to fully prepare is one of them. You cant just put Se habla Español in an ad and expect to be overrun with clients, Little says. And youve got to be properly equipped with a bilingual person and materials in Spanish and English when those clients reach out to you.
Translation can be dangerous terrain, as evidenced by the horror stories of mistranslated text and concepts. A few years ago, Parker Pens ran an infamous ad assuring Spanish-speaking customers that its pen wouldnt leak in your pocket and embarrass you. Instead, the translation read, It wont leak in your pocket and make you pregnant.
Little says people sometimes assume that because they took high school Spanish, theyre proficient enough to prepare their own bilingual materials without expert assistance. Its important to ensure your translations are culturally appropriate and using the version of Spanish relative to your market, she says. You can offend this market big time. Its not worth it to save a buck here or there.
A qualified marketing consultant can handle translations and recommend valuable advertising vehicles and mailing lists. They also can provide cultural insights on effective communication. For example, family, friends and loyalty are hot buttons for Latinos, who tend to favor small talk to establish a relationship before plunging into business negotiations.
In choosing a consultant, do your homework. Look for someone who has the resources to research the market and to identify Hispanic patterns. Check to see if they are walking the walk, Little says. Do they have a bilingual staff? Do they have collateral, including a website, in both English and Spanish? Do they understand the self-storage industry and its challenges?
Erroneous assumptions about the Latino market are preventing many companies from pursuing the demographic, according to Little. Some believe there is no money there, others are scared off by the possibility of hassles and costs associated with target marketing. Its natural to be wary of uncharted territory. But Little says the bold investor shouldnt allow his fear of the unknown or beliefs in outdated stereotypes to steal away future profits.
Dont underestimate what this market offers to businesses. It may seem complicated, but it really doesnt have to be with the right agency or consultant to evaluate existing efforts, identify opportunities, develop and execute the strategy. Make the effort, she says, and you will be rewarded.