Gary Halbert, the guru of marketing and copywriting, taught me many lessons over the years. In this article, Im going to teach you the most profitable one, and show how it increases profit and occupancy immediately. It only works if you follow the steps.
Imagine for a moment that you and a friend both decide to open a new self-storage facility. And being the competitive friends that you are, you bet on who can first achieve 90 percent physical occupancy.
As youre planning your new site, you really get into this bet and want to knock the socks off your friend. You begin by making a list of items that will surely win you the crown. What goes on it?
When I present self-storage operators with this imaginary scenario, I usually hear the following answers:
- Good property location with high traffic counts
- State-of-the-art construction and design
- Top-notch security features
- Attractive office features such as granite countertops, computers, snack stations, 24-hour kiosks, etc.
- A nice, fully functional website
- Experienced and trustworthy managers
All are good responses, but a major item is missing that will make or break any self-storage business. Curious? The one thing you should strive most for is
A Starving Crowd
In other words, you need people hungry to keep their home or office organized, who are starving for cleanliness or extra space in their lives and are willing to pay a fair price for it.
Yes, I know this principle is disarmingly simple. In fact, youre probably disappointed I just revealed something so boring and obvious. The truth is, though, while most operators consider this knowledge common sense, very few actually use the starving-crowd principle in their marketing efforts. The basics of the principle are:
- Identify starving crowds.
- Find access to them.
- Communicate your message in such a way that theyd feel foolish to use anybody but you to meet their needs/wants.
If you follow this simple formula with all marketing plans, youll have much bigger success than if you dont. But who are these starving crowds, and how do you reach them? Of course there are the regulars:
- Apartment dwellers
- Military personnel
- Pharmaceutical reps
All are great prospects and should be fully exploited, but your competition also knows about them and usually bombards this group with marketing ploys. So Im going to reveal a few more starving crowds that are often overlooked and teach you how to serve them.
1. Existing Tenants.Your existing tenant base is a gold mine. You know these renters need storage and are willing to pay for it. You have their contact info and, hopefully, theyve received excellent service and trust you as their storage provider. What you might not know is they usually need more space than theyre currently renting. In addition, theyll purchase other products and services from you, and will gladly tell their friends about you when they need storage, too.
Any storage facility not sending well-written direct mail to existing clients is leaving money on the table. Right now, many of your existing tenants would rent another or bigger space if you gave them good reason. Also, some are storing belongings who would love the peace of mind tenant insurance provides. In addition, you probably have renters who are planning on moving and would gladly buy all of their packing supplies from your site if you offer a more affordable and convenient option. Finally, there are tenants who constantly trip over clutter at their friends home and would love to give you a referral. Put together a 12-month schedule to reach your existing tenant base and make sure to stay in constant contact with these people.
Before moving onto the next starving crowd, I must give you a warning about tenant-based marketing: Direct-mail letters must be very high quality and intelligently written. If youre lazy with your piece, youll end up annoying your customers rather than becoming a bigger resource.
2. New Movers.Many operators focus only on people selling their homes and ignore those who have recently moved because they think its too late to sell them storage. This is big mistake. Think about it: When are people most obsessive about keeping their car clean? Right when they buy it. They wash it regularly; they dont eat on the go.
People take the most pride in belongings immediately after theyve forked over the cash to purchase them. So when someone moves into a new home, he wants to keep it clean and organized. What better time to get a storage unit?
Additionally, the current real estate and financial market is forcing many people to downsize homes. A study in July 2007 revealed 19 percent of movers downsized, leaving them with extra belongings that needed to be stored. Here are some more moving facts:
- Nothing triggers a wave of consumer spending like a move. Studies show spending can reach as much as 20 times higher than that of non-movers. (If youve moved recently, you probably know what I mean!)
- There's probably no other point in our lives when we make so many spending decisions in such a compressed time period as we do two months before through two months after a move.
- The average person spends more than $7,300 within three months of a move.
- When it comes to brand loyalty, 67 percent say they couldn't care less when choosing new service providers in their new neighborhoods.
- Of movers, 4 percent plan a major home improvement after purchasing a new residence, creating an even stronger need for storage.
- Approximately 20 percent of U.S. households relocate every year.
Hopefully you see the golden opportunity with this starving crowd. As with tenant-based marketing, the quality of your direct mail piece is very important. Write to them in a persuasive, conversational tone and give them a good offer that caters to what we know about them.
Subscribe to a new-mover service that sends you a weekly list. Mail to these people immediately when you get their contact info and once more 30 days later to make a solid impression.
3. Neighbors of New Tenants.Youve heard about keeping up with the Joneses, right? Nobody wants to admit it, but if your neighbor gets a new car, big-screen TV or other home improvement, most of us will want something equal or better.
Weve found the same to be true of storage. If everybody in a neighborhood has cluttered garages, yards and homes, we dont feel as pressured to keep our homes clean and organized. As soon as one of our neighbors cleans up and makes his home look the best on the block, two or three will almost certainly follow suit very soon. Ive lived in six cities in my life and watched this phenomenon transform several neighborhoods.
Human behavior is highly influenced by friends and neighbors. This has been true since the beginning of time and will probably continue forever. Use this to your advantage by marketing to the closest 25 to 50 of your new tenants neighbors. The list accuracy and letter you send are crucial. Regardless, this strategy is very inexpensive and highly effective once you get going.
While weve only covered a few starving groups here, dozens more exist in every market. Take an hour or two every week and ponder this principle. Youll begin to notice starving crowds all over the place and capitalize on this potential feeding frenzy.
Derek M. Naylor is president of Storage Marketing Solutions, a full-service, results-oriented marketing and advertising agency dedicated to the self-storage industry. For a free subscription to his e-newsletter, call 800.941.4805; e-mail [email protected]; visit www.storagemarketingsolutions.com.