Get Pricing Right And Why It Matters

As consumers become increasingly comfortable and more reliant on the convenience of the world wide web, it is expected that businesses should provide information at the click of a button. Whether consumers are looking to book a flight, reserve a hotel or shop online, businesses face the pressure to be front and center of their consumers.

The same applies to the self-storage industry. It is very important to make it easier for tenants to make reservations or complete a rental from the convenience of their smartphones or computers. Savvy consumers have learned how to shop around for the best deal and any businesses or products not accessible for instant comparison are quickly disregarded. For the average self-storage operator this means, at minimum, maintaining a website which enables the consumer to view rates and ideally, be able to make reservations and even rent instantly. This brings us to the next point – pricing.

Why Pricing Matters

Pricing is one of the most important aspect of business — it directly impacts the bottom line. In self-storage this is especially true due to the recurring revenue of monthly tenants. When a consumer is researching self-storage options, if they don’t see a price then they likely omit that facility from consideration (they don’t want to call or wait for an email response.) So, it is imperative to not only display your pricing information online, it’s important to ensure the price you offer is competitive in your market.

The top and mid-tier operators understand this and have mastered pricing by investing heavily in departments dedicated to revenue and pricing optimization. At the other extreme, single-store and independent operators often rely on store managers to make pricing decisions based on data collected through manual competitor web research and call-arounds (mystery shopping.)

By not having a systematic approach to pricing, these operators leave themselves open to a loss of market share to Real Estate Investment Trusts (REITs) and other competitors who use their position in the market, along with smart pricing strategies, to take over opportunities for growth.

While the REITs and other large firms have the means to develop or invest in sophisticated technology, affordable tools have recently emerged to help the average self-storage operator look at pricing more strategically. Manually researching and calling-around for pricing might give operators a snapshot in time of the competition; however, this information is often unreliable or cannot be used to monitor trends or derive meaningful analytical conclusions.

In such an aggressive industry and an in era of growing technological reliance, smaller operators wishing to retain market share cannot afford to ignore pricing or the shopping behaviors of their consumers. At minimum, self-storage firms should review their pricing strategy and find tools which can help them understand and improve their market position - always offer the right price.

Article Contributions by: Angela Kilkenny - Sales Director at Stortrack

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