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Advice for Setting and Spending Your Self-Storage Marketing Budget

By Donna Edwards Comments
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Self-storage marketing has changed greatly during the last 10 years. Printing costs have increased, resulting in higher advertising rates. Social media has provided additional opportunities. Fewer people are reading printed magazines and newspapers, having switched to digital versions. Mobile-friendly ads are necessary for customers using smartphones. Increased media competition has provided more advertising channels.

When formulating your marketing budget, one trap to avoid is planning to get a specific dollar-for-dollar return. It isn’t wise to say, “Well, if I spend $300 on this magazine ad, then within two weeks I should have 2 percent of its subscribers rent a storage unit.” Advertising doesn’t work that way. Specific returns on investment are difficult to quantify.

If you ask people how they heard about your business, many may not be able to tell you. They may say they found you online, but where? On your website? Your Facebook page? On the local newspaper website where you purchased a digital ad? In many cases, it’s difficult to determine where a customer saw information about your business.

The Need for Smart Choices

Online advertising is now the dominant marketing medium for many U.S. businesses. Ad placements, search engine optimization, digital ads, mobile ads and social media are leading the advertising choices in the marketplace, while traditional media, such as print, radio and television, are declining.

Multiple small ads spread over time tend to be more effective than a one-time, large, expensive placement. Also, consider the ad’s shelf life. One recommendation is to run an ad every other day in a daily publication or every other week in a weekly publication. This refreshes the memory of the reader and requires less financial commitment. Many publications will offer a multi-ad discount to entice you to advertise more during the year. They may also offer a package that enables you to use a traditional ad in print and a digital ad online that links back to your website.

The goal for marketing and advertising is to create visibility and have potential tenants think of your property first, before researching online or looking elsewhere to find a unit. When large real estate investment trusts and other national self-storage companies are in a market, they’ll pour lots of money into online ads to ensure their brand name and facilities rank first in online searches. Most independent self-storage owners can’t compete against the marketing budgets of much larger operators, so marketing campaigns and advertising placements must be more selective.

Deciding Where and How Much to Spend

The more limited your marketing dollars, the more wisely they must be spent. Several factors can help determine where and how much to invest, for example:

  • Is this a new property or an established one?
  • Is it a highly competitive market, or is your facility the only one in town?
  • What are the demographics in your area?
  • Are there times of the year when you see more rentals than others?
  • Which features at your facility are different or better than the competition?

In a highly competitive market or when promoting a brand-new property, advertising will be more important and require additional budget. For established properties or in markets with little competition, advertising can be reduced but should never be eliminated.

Some experts recommend budgeting a minimum of 2 percent of gross revenue, while others suggest at least 5 percent to grow your business. In highly competitive markets and industries, marketing budgets can creep up to 20 percent or more of gross revenue. The Small Business Administration recommends allotting 7 percent or 8 percent if sales are less than $5 million and gross profit after expenses is in the range of 10 percent to 12 percent.

Committing marketing dollars depends greatly on your revenue and business goals. Self-storage owners must determine if they want to grow or stay even in sales from year to year. The old adage “You have to spend money to make money” is true when it comes to marketing. Without a viable plan, potential customers may not know your business exists.

Knowing age demographics can also assist decision-making on where to spend your advertising money. In many cases, older prospects in their 50s, 60s or 70s will research storage in their area differently than those in their 20s, 30s or 40s. A younger demographic is more driven to make buying decisions after researching online. This group is also more likely to rent online and respond to social and digital media. Older prospects may research online but still also use the Yellow Pages and local print media, and get recommendations from peers before visiting the facility to see it for themselves.

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