We started a series last week looking at the current challenges we are in and what I think as owners we should be focused on to help keep our self storage companies going strong over the next year or so.
I laid out five things we are focused on:
- Effective & cost-efficient on-line marketing.
- Effective & cost-efficient automation.
- Effective & cost-efficient revenue management strategies.
- Enhanced customer experience.
- Effective & cost-efficient operating expense management.
Let’s discuss the first one.
Back when the Great Recession hit in 2008, all of us most likely had yellow page adds. When I got started, 86% of our new leases came from yellow pages.
By 2012 or so, I ran my last yellow page adds.
For the next few years, as owners, we had to spend very little on marketing compared to what we used to. We got spoiled.
Then, in the last few years, lease-up and keeping our facilities full got harder.
Instead of the yellow pages, we now have to focus on Google. Not as easy. It is an ongoing evolutionary process that changes and is different for every market.
Let me start by saying I am not an “expert” in online marketing for self-storage facilities. But I have never worked with an “expert” that has generated any results period, much less any cost-effective results.
People who are searching for self storage to rent usually start here or end up here at some point in their leasing experience. If your business strategy is to rent to people who don’t use Google, well… I’d say that is a flawed strategy.
And if you are waiting for your site to “organically” show up on Google’s first search page, I would also tell you that it is a flawed strategy.
You need to have multiple “search” campaigns going in Google so that your facilities and web sites show up when people are searching for self storage.
I wrote about this a few months ago, but nothing much has changed in what we are currently doing since then. Let’s take a look.
Types of Marketing
Let’s get super simple and say there are two basic marketing types of campaigns.
- Brand awareness campaigns.
- Offerings & rent now campaigns.
Each has its place, but my coaching is put the bulk of your marketing budget on item 2 above.
Brand awareness is good to do, especially if you are building a new facility, or have just taken over one and you are in the process of re-branding and re-positioning it in the market place, but for the majority of people in your market area, unless they want or need self storage, your branding falls on deaf eyeballs and ears.
We use “branding campaigns” on Facebook, mostly. I also use them to attempt to identify a potential customer.
In general, we use Facebook’s paid advertising platform to run mostly videos telling the market something about our facility or the industry.
You have to be creative here to generate any interest.
I usually optimize the ads for “video Views” not for conversions or website visits. I want the Facebook algorithm to find people in the facilities market area that will interact and watch the video.
So, I have come up with videos like “Here is what self storage Owner’s don’t want you to know,” and talk about how disk locks are the best form of security, or “Are you tired of having self storage rent increases?” and talk about dynamic pricing and how we don’t use it.
We then get data on how many people watched 25%, 50%, 75%, 90%, and 100% of the video. For the people that watched 50% or more, we can re-target them with a specific offer.
We have found that it is a much more cost-effective way of utilizing that portion of our budget.
But the majority of our ad spend goes to Google.
We run mostly search, pay per click type advertising.
We use the Google keyword planner, see what terms people in our different market areas are using, then design a pay-per-click campaign with adds, so we show up “above the fold” (i.e., on the top part of the first page, so potential customers don’t have to scroll down) until our budget runs out.
It is expensive, and you have to design your campaign effectively to be competitive. We are finding that today, it cost between $4 to $10 per click depending on the keywords you use, the competition in the area, and the size of the market.
We are mostly in markets where REITs are competing with us. It could be much lower in other markets.
One of the big mistakes I see people making is where they take the visitors who click. Most people just take them to the home page of their website.
I recommend taking them to the most relevant page. If the add is offering a discount if they lease online, take them to the page where they can rent a unit. It also helps with the Google algorithm having specific pages to take people to.
I have also taken people to a landing page instead of a website.
If I am giving an offer, a landing page has two options, take the offer or leave. If they take the offer, then they are taken to the relevant page on my website.
On our website, there is a lot people can do. They can look at pictures, check out the storage calculator, perhaps watch a video or two. I mostly want traffic from online marketing to take action, not look around.
This is just my thinking, which doesn’t mean it is right. I am just trying to get the most bang for the buck of spending.
Speaking of that, budgets for online spending are going up.
I have had consultants in the self storage space tell me we should be setting a $10,000 per year online marketing budget.
In a lease-up facility, it can be even double that.
If you have a $50 per day Google budget, which is low as far as Google is concerned, that’s $18,250 or so per year.
We increase the budget during peak leasing months and lower it in others.
My coaching is to learn something about online marketing, even if you plan to hire a vendor to handle it, so you can recognize a good one when you see them.
I also recommend utilizing 20% of your marketing budget to “Brand Awareness” and related campaigns (like our running offers in re-targeting), and the balance on keyword search campaigns.
Some people split up between Google, Bing, and Yahoo. We don’t, but perhaps we should.
If you outsource, try to get people who have had specific experience in the self storage space. This can get very expensive, very fast with few results.
Even if you are not the person to be doing this, I think as an owner, it is important to know some of the basics so you can recognize an expert when you see one.
In the upcoming year, this, in my opinion, could be the most important thing to focus on that can determine if you succeed or fail in this business. Especially if you are in lease-up.
You can learn the fundamentals and what to do. There is a lot of information out there and courses on it.
Be a student. Learn. Grow. Change.
Embrace this new time we are in and stay relevant. You can have a long and profitable career in this fantastic business of self storage if you do.
