If you regularly read content about business and marketing, chances are you’ve recently seen dozens of articles discussing ChatGPT, an artificial-intelligence (AI) language model from OpenAI. Released in November, the tool is free to use and has been touted for its sophistication. It’s been lauded for its capability as well as feared for its potential impact on humanity.
As a consumer, I’ve often been frustrated when interacting with various chatbots in trying to troubleshoot technical issues or get customer support, so I was curious to see how ChatGPT differed. With many self-storage operators beginning to integrate chatbots into their customer-service mix, I was curious to get a sense of ChatGPT’s breadth of the industry and get a sense of the larger AI implications if integrated into a self-storage business.
So, for kicks, I sat down and conducted a Q&A session, asking it specific questions about the self-storage industry. In all, I asked it 16 questions on a wide range of topics to get a sense of its baseline knowledge and interpretive skills. I came away pretty impressed. The full length of our “discussion” is too long to post in its entirety, so I’ve cherry picked six items I believe will give you a good sense of its capability and industry knowledge.
When you first interact with the tool, it gives you several bits of information and disclaimers, two of which I think are particularly relevant when considering the answers below:
- While we have safeguards in place, the system may occasionally generate incorrect or misleading information and produce offensive or biased content. It is not intended to give advice.
- Limited knowledge of world and events after 2021.
With these in mind, here are six questions and answers, beginning with some foundational knowledge and then asking for some predictive insight. The questions are exactly as I input them, and the answers are unedited other than adding some bold emphasis for the sake of presentation.
A Self-Storage Q&A With ChatGPT
How would you describe the self-storage business model to someone who is completely unfamiliar with the industry or service?
ChatGPT: The self-storage business model involves renting out storage units to individuals or businesses who need extra space to store their belongings or inventory. These storage units are typically rented on a monthly basis and come in various sizes, with the customer choosing the size that best suits their needs. The customer is provided with a lock and key to secure their unit and can access it at any time during the facility's operating hours.
Self-storage facilities are usually located in easily accessible areas and are designed with security in mind, often featuring security cameras, perimeter fencing, and individual unit alarms. Many facilities also offer additional services, such as climate-controlled units, vehicle storage, and packing supplies.
The self-storage business model is attractive to individuals and businesses who need extra space but do not want to commit to a long-term lease or purchase of real estate. It offers a flexible and convenient solution for storing items for short or long periods of time. Additionally, because customers are responsible for transporting their own items to and from the storage unit, self-storage facilities have relatively low overhead costs and can be operated with a small staff.
Based on current market conditions, what is considered a smart investment path if someone wants to become a self-storage business owner?
ChatGPT: The self-storage industry has been growing steadily over the past few decades and has proven to be a resilient asset class, even during economic downturns. However, as with any investment, there are risks and factors to consider before entering the market.
Here are some considerations for someone looking to become a self-storage business owner:
- Location: One of the most important factors in the success of a self-storage facility is its location. Look for areas with growing populations and limited competition, as well as convenient access to major roads and highways.
- Demand: Consider the demand for self-storage in the area. Look at the vacancy rates of existing facilities, as well as the amount of new self-storage development in the pipeline.
- Market saturation: Be aware of market saturation. Oversupply can lead to lower occupancy rates and lower rental rates, which can impact the profitability of the business.
- Financing: Determine how you will finance the purchase or construction of the facility. Self-storage facilities can be expensive to build or acquire, so it's important to have a solid financing plan in place.
- Management: Decide whether you will manage the facility yourself or hire a third-party management company. Managing a self-storage facility can be time-consuming, so outsourcing management may be a good option for some investors.
- Technology: Consider implementing technology solutions to improve efficiency and customer experience, such as online rental and payment systems, security cameras, and keyless entry systems.
Overall, investing in the self-storage industry can be a smart choice for those who are willing to do their due diligence and carefully consider market conditions and risks.
What service or business strategy should more self-storage operators adopt to better satisfy today's customers?
ChatGPT: One service or business strategy that more self-storage operators should adopt to better satisfy today's customers is to embrace technology and provide a more digital customer experience. Here are some specific ideas:
- Online reservations and rentals: Many customers prefer the convenience of renting a storage unit online instead of having to visit the facility in person. Self-storage operators can offer an online reservation and rental system, allowing customers to choose their unit, sign the lease, and make payments all through a website or app.
- Contactless move-in and move-out: In the wake of the COVID-19 pandemic, customers are more concerned about contactless options for move-in and move-out. Self-storage operators can provide digital contracts and virtual tours to reduce in-person interactions, as well as contactless move-in and move-out procedures.
- Mobile apps: Mobile apps can offer customers an easy way to manage their storage unit from anywhere, with features such as online payments, gate access control, and unit status updates.
- Automated customer service: Self-storage operators can leverage chatbots and automated customer service systems to handle customer inquiries and requests, reducing wait times and improving response times.
- Enhanced security: Customers want to know that their belongings are safe and secure, so self-storage operators can implement advanced security measures such as biometric access control and 24/7 video surveillance.
By adopting these technology-driven strategies, self-storage operators can provide a more convenient and secure experience for their customers, helping to attract and retain them in an increasingly competitive market.
What are the top three marketing strategies self-storage operators should use in today's market?
ChatGPT: Here are the top three marketing strategies self-storage operators should use in today's market:
- Digital marketing: In today's digital age, online marketing is essential for self-storage operators to reach potential customers. Digital marketing strategies can include search engine optimization (SEO) to improve search engine rankings, pay-per-click advertising (PPC) to target specific keywords and audiences, and social media marketing to engage with customers and promote the facility's services.
- Referral programs: Word-of-mouth referrals are powerful for self-storage operators, so implementing a referral program can be an effective way to attract new customers. Offering incentives such as discounts or free storage for referring friends and family can encourage current customers to spread the word about the facility.
- Community involvement: Self-storage operators can build brand awareness and establish themselves as community leaders by getting involved in local events and organizations. Sponsoring community events or donating storage space to local non-profits can help to build a positive reputation and increase visibility in the community.
By implementing these marketing strategies, self-storage operators can improve their online presence, leverage the power of word-of-mouth marketing, and establish themselves as trusted members of the local community, all of which can help to attract and retain customers in a competitive market.
What will be the most impactful technological innovation widely adopted by self-storage operators in the next 10 years?
ChatGPT: There are several technological innovations that self-storage operators are adopting or exploring, and it's difficult to predict which will have the most impact over the next 10 years. However, one technology that has the potential to significantly transform the self-storage industry is the use of artificial intelligence (AI) and machine learning (ML).
AI and ML can be used in a variety of ways to improve the efficiency and effectiveness of self-storage operations. For example, AI-powered chatbots can provide customer service and support around the clock, freeing up staff time and improving the customer experience. ML algorithms can analyze customer data to predict demand and optimize pricing strategies, which can increase revenue and occupancy rates. Smart sensors and cameras can monitor units and alert staff to potential security or maintenance issues, improving safety and reducing the risk of theft or damage.
Additionally, AI and ML can help self-storage operators manage and analyze large amounts of data, providing insights that can inform decision-making and improve operational efficiency. For example, predictive maintenance algorithms can anticipate equipment failures and schedule repairs before they occur, reducing downtime and maintenance costs. Data analytics can also be used to identify trends and patterns in customer behavior, which can inform marketing strategies and improve customer retention.
Overall, the use of AI and ML has the potential to revolutionize the self-storage industry by improving efficiency, enhancing the customer experience, and enabling operators to make data-driven decisions.
In what ways will the self-storage manager role likely change in the next five years?
ChatGPT: The self-storage industry is evolving rapidly, and the role of self-storage managers is likely to change in several ways over the next five years. Here are a few possible ways that the role may evolve:
- Increased use of technology: As the industry adopts new technologies such as artificial intelligence and automation, self-storage managers may need to become more tech-savvy and comfortable using digital tools. For example, managers may need to learn how to use chatbots to provide customer service, how to analyze data to optimize pricing and marketing strategies, and how to use remote monitoring systems to manage facility operations.
- Expanded responsibilities: With the increasing importance of customer experience and satisfaction, self-storage managers may take on expanded responsibilities such as marketing and customer engagement. Managers may need to develop skills in social media marketing, customer service, and relationship-building to attract and retain customers.
- Greater focus on sustainability: As consumers become more environmentally conscious, self-storage managers may need to focus more on sustainability initiatives such as energy-efficient lighting, waste reduction, and green building practices. Managers may need to learn how to promote these initiatives to customers and stakeholders to enhance the facility's reputation and appeal.
- Emphasis on safety and security: With the increasing importance of safety and security in the wake of the COVID-19 pandemic, self-storage managers may need to prioritize protocols and procedures that keep employees and customers safe. This may include measures such as enhanced cleaning, social distancing, and contactless payment options.
Overall, self-storage managers will likely need to be adaptable, flexible, and willing to embrace new technologies and strategies to succeed in the evolving industry landscape.
Pretty interesting, right? I was surprised by the depth and breadth of the answers. Though mostly general in nature and clearly gleaning readily available tidbits from what it can see across the internet (including a lot of parallels with ISS content), it largely put together its responses in the proper context. The clarity of the writing particularly stands out from other tools with which I’ve interacted, and the speed at which these answers were returned was quite impressive.
It seems clear that an AI tool of this capability has the potential to provide tremendous value and insight to individual self-storage businesses if integrated with systems software and given an opportunity to interpret operational data. That’s in addition to its potential to enhance marketing messages and interact one-on-one with tenants and prospects.
It’s mind blowing to think about the possibilities as this and other AI tools become more robust and capable.