As online reservation networks deliver increased profit, self-storage facilities are balancing opportunities to improve the bottom line with the possible risk. If you’ve held back on joining an online reservation network until now, how do you choose one that fits your business and keeps your data safe?
There are many benefits to offering online reservations to your potential storage customers. Statistics show that 56 percent of online reservations occur during normal office hours, and 52 percent of customers reserving a unit online are choosing a 10-by-10 or larger. It has also been shown that when an online reservation is secured with a small credit card deposit, the move-in rate is typically 95 percent or higher.
What this means for operators is valuable customers are now choosing to reserve online over calling or walking into a facility. To stay competitive, you need a plan to service these customers.
Find Your Fit
If this is the year you aim to boost your profile and increase your profit with online reservations, take some extra time and make the best choice. When done correctly, online reservations can be a seamless, easy way to gain valuable new tenants. There are currently three online models from which to choose, each with distinct advantages and disadvantages. Let’s take a look at each.
Real-time online reservations. These networks, provided by reputable partners, are convenient and secure. It’s important they’re able to display your up-to-date live inventory along with unit features and specials to the consumer. This way, your potential customer sees accurate information about what you have available. The customer then has the option to reserve a unit via the Web. Typically, the self-storage operator is only charged when he receives a secured reservation.
What’s the downside of promising return rates? Depending on what property-management system you’re using, there may be some limitations on processing reservations in real time. It’s best to check with both your management-software provider and your online-reservation partner as to what limitations might exist.
Lead-generator reservations. If you go with a lead-generator model, only you can make it profitable. A facility may receive either qualified and exclusive leads, or a lead that goes out simultaneously to multiple storage operators. If you want to compete, you have to be responsive. Lead generators can either charge you a flat monthly advertising fee or a pay-per-lead system. With either cost model, cost per rental goes down with every lead converted.
There are two questions you should ask: Will you be able to convert truly qualified leads at an acceptable rate? Second, if you’re receiving leads shared with competitors, is it worth the investment? Shared leads convert at a much lower rate. To determine whether you’re paying for quality leads resulting in confirmed reservations, closely track your conversion rates and your average cost per conversion. This will give you a good idea of how well the site is working for you.
Bid process. In this model, the customer gets to name his ideal price on storage, then area facilities bid to win his business. If you’re ready to compete for your customer on price alone, the bid process may be the way to go.
With this kind of model, you need to ask: What kind of customer do I want to attract? Make this choice understanding that your company may have to offer the lowest price to attract the customer, and even then you may pay for an extremely price-sensitive customer who moves out at the first opportunity. Bottom line: The emphasis on the lowest cost means you may miss out on the best customers.
As you sift through your options for an online-reservations partner, beware of new companies popping up online. If a company seems to appear almost out of nowhere, it may go away just as quickly. Approach your online-network decision as a partnership and choose a company you trust to access to your database.
Once you’ve checked into a company’s track record and verified trustworthy references, you’re ready to ask some tough questions to protect your data, such as:
- Who is accessing my data?
- What are they accessing and how?
- Do they have the proper security measures in place?
- Are they storing credit card data? If so, is the process secure?
An online reservation involves being able to show available units with their features, prices and current specials to prospective customers. It allows customers to commit to a rental by putting down a small deposit online, securing the unit until they can come into the facility to complete the purchase. The process doesn’t require access to existing-customer information within your system. If a network requests access to that information, it’s a red flag, as it’s simply not necessary to process an online reservation.
Your management software may already have controls in place to restrict access for your online partner. If controls are not built in, it’s even more important you have a trustworthy and proven relationship with your online-reservation partner
While digging into all the pros and cons of online reservations may feel like homework, it’s well worth your time. It’s important to grow your storage business with online partners that meet the needs of your operation and customers. When you identify an online partner, make sure the security of your data is a top priority. With guaranteed peace of mind, you’ll be ready to maximize your profit with online storage reservations.
Megan Eckert is executive vice president of USstoragesearch.com, which provides service to more than 12,000 member facilities and 2.8 million storage units nationwide. The company’s online marketing program allows owner-operators to put their facilities in front of potential tenants looking for storage in their area. For more information, call 866.880.0742; visit www.usstoragesearch.com.