We all know of people who enjoy the finer things life has to offer. They drive whatever exotic vehicles they want and couldn’t care less that gas is approaching $4 per gallon. They travel on plush private jets to business meetings and long Caribbean vacations. They wear silk, cashmere, linen and organic-cotton clothes while dining on exotic food prepared by world-class chefs.
Not all of these folks are celebrities, captains of industry or public officials. They live in peace with their families and do what they want, when they want. If I listed some names, you wouldn’t recognize a single one. Yet, they live a dream lifestyle that few can even imagine.
How do they do it? They have built multiple businesses using a certain marketing mindset that I’m going to teach you in this article. You’ll have a new view on marketing that will drastically increase the profitability of your self-storage business and any other business venture you might embark on in the future.
The Gift That Keeps on Giving
As a self-storage operator, you have a rare gift that most industries don’t get to enjoy without significant effort, planning and execution: You earn repeat sales automatically when a new tenant rents from you. Most industries must work diligently to create advertising that creates one sale. After that sale, they hope the customer’s experience was good enough to earn a second sale sometime in the future.
But that’s not true for you. If you rent someone a unit, you get the first month’s rent, profit from packing supplies and maybe an extra few dollars from a pay-with-rent tenant insurance sale. And then, one short month later, you get another chunk of revenue from that person. This happens again and again until they move out. Some folks will only stay for a few months, but others will stay for years, paying you rent each month.
It’s a marketer’s dream come true to acquire a customer and automatically earn sales for months or years on end. Most operators take this valuable gift for granted. Imagine if you had to re-sell each customer every month. It wouldn’t be much fun or very profitable.
Once you understand the power of this, you can easily begin to focus your energy toward your most important objective, which is acquiring customers.
Savvy marketers understand that it’s perfectly fine to lose money on the first sale. And if the economics work out, it’s OK to lose money on the first few sales. In other words, if your average tenant brings a net profit of $700, it’s worth it to pay $350 or even more to acquire that renter through a marketing channel.
Smart operators gladly pay $350 for a new tenant rather than hold an excessive inventory of vacant units. They don’t look at a tenant as being worth only $70 because the total value is $700. Further, they understand the importance of building the value of their asset by about $2,450 each time a new customer rents, even if they pay $350 for a new tenant!