What Are You Willing To Spend To Acquire A Self Storage Customer?

Good morning, guys or what? See who's jumping on there saturday morning? Who's that? Who's that ambitious to join a facebook? Live on a saturday morning.

See how it goes? Uh, no. Like I said, i'm going to keep these going. I got middle challenge to myself of 30 days in a row of doing these, and that includes weekends.

Since the weekend is a day. So I will keep it going, uh, again, I record. This is well from my podcast episodes. So don't get lost when I kind of dio three pause and then introduced the podcast and end it, uh, do that for the for the context. So that's how that goes off your own.

Say hi. You see who's coming on here? Thio got it from are coming on. Good. Wow. People around on the saturday morning. That's nice.

Uh, yesterday was busy. Uh, when we get the content here in a second, we get some more people coming on fridays. I did my open office hours like my open virtual office hours.

It was a long day. Everyone took me up on it. It was kind of back to back to back to back to back to back for, 6. 5 hours yesterday. So it was fun.

Uh, it's honestly talking to people getting your questions as well. It was kind of flushing things out. We're kind of talking about your experiences. It helps me create content and kind of know. Okay, well, let's let's talk about that next time. So it was kind of cool.

Um, a lot of people that are getting into storage asking an investor questions. And i'm always the first one, I tell everybody, non investor.

Uh, not yet. That's it's coming. I'm much more of the operations, the marketing revenue management. Pretty much when the you have a site cool, I maximize it for you.

Uh, I do have a lot of contacts and people that can ask who ask for specific questions when it comes to evaluate of property, doing the feasibility, all that kind of fun jazz. So it was kind of 50 50 split yesterday of people that were either getting into storage or the clothes they're already in storage and one toe help maximize their operations. So it was a fun day of long day, but it was fun s oh, yeah, i'll mix up in the lincoln here is well on the facebook group.

Yeah, not part of facebook group. Thanks again for tuning in the self storage show. This'll episodes kind of dovetails nicely what I was talking about yesterday, uh, previously, we talked about competition alliances, and it just happened to mention, you know, well, how much are you willing to spend to acquire a customer?

Because that's how you kind of figure out how much you want to be able to give a za referral fee. And I guess that one little sentence kind of sparked a couple people toe ask me during my friday sessions have these open virtual office hours and we touched upon that and kind of dumb or in depth on, you know, the marketing campaigns, what they're currently doing.

What's my ideas? That I had to help them get some more calls, stand out in their market, and I always come back to that? Well, you know, I always ask the owners well, what are you willing to spend to acquire a customer and pretty much 10 times out of 10? Uh, they don't have any kind of get to that that number.

That's what we're gonna talk about today. And it was interesting, you know it this just take a quick story. There's there's one guy, uh, once seen him, but we were talking about that.

And isn't it a very competitive market? We're asking. What do you currently doing? Get the phone to ring. And so one e got a website.

Good for you. You're in the year 2000. What else? And that was it. Okay. Uh, no judgment no, not at all. I mean, I was glad you don't call me and let's talk about it, cause cool. That's step in the right direction.

Cool. Now, let's what do you want to get to? How we gonna get there? Let's build that bridge. And so I simply ask that question, you know, what are you willing to spend to acquire customer?

Thank liza. I don't I don't know. Quite cool. Let zwart let's work on this, okay? We're gonna we're gonna find an answer before the end of the phone call. That's all we did was focused on that. And so when it was software actually kind of shared screens a little bit.

And when to a store software. And it all comes down to find average lifetime customer value for your property. You know, basically, that is what your what? Your average customer rate is for your property.

Okay. Do you average 100 bucks per unit? More than that. Whatever. Just getting that average customer rate that you're charging, what's your average length of stay for your current customer base?

And in this case, he was he was he's been around for about a year, so he had a decent of track record. But for those of you that air call your brand new out of the gate to clean slate.

Uh, just stick with 12 months. Okay? You can kind of start justin that as time goes on, but and I know some people like, oh, the average lifetime customer values more. Just keep it number.

You keep it. You know, simple. 12 months is your average length of stay. Okay, times those two together.

Cool walla. There's your average lifetime customer value. And some people, they get really in depth and they go, they start getting the average customer rates by a certain size codes. And you can do that.

Sure. One of the brain damage. Cool. But I like to keep things very simplistic. Just at least get this initial figure. Okay? So again, find your average customer right.

Aren't your facility the average length of stay times? Let's to together there's your average lifetime customer value. Eso in this particular case, is what we figured out. This average lifetime value was about 1500 bucks.

Just try it at those 1500 bucks. What's interesting? The more and more i've done these thieves sessions, especially. I've done some challenges in the past, and this is one of the first exercises that I have. Those that are going through challenges do because everything else that we talk about builds upon that.

Okay, I just having that foundation, knowing that number and again, most people that they haven't dunks before, and it's a great exercise. Very simplistic. You can probably find this figure out 10 minutes.

If you know anybody, go to on your storage software. If you need help. Cool. Just message me, guys. I'll be able to put in the right direction on your store software because each one is a little bit different. Where to go to eso, happy to help that way.

But when people are going through these challenges on that idea, and this is one of the first exercise that have them, dio and I haven't post what your hours lifetime value, and it's it's very eye opening because I recites different, you know, depending how big your location is.

Uh, you know how big size units they are? Because I could make a big difference if you have a lot of, uh, large size units, you know, for example, I run a site that you know are for 90%

12 by 20 fours. Okay, they're just they're big units and our average lifetime customer value their I have to cap it off three years because I was like, the state is kind of just, you know, people that read the bigger units. They stay forever and so just kind of skews the numbers. I capital three years, and our average lifetime value is about 4000 bucks at that site.

Eso that's kind of on higher end. Get something lower end. You know, it's more kind of chair and burning people going through the sites, not staying very long.

Yeah, it's about 1012 100 bucks, kind. That's kind of the lower end. I see. So that's kind of your spectrum. So I didn't want to figure out what it is for your particular location.

Once you get that member, let's just for simple math, okay? It's I was lifetime values 100 bucks for I mean every like the stage 12, 12 months averaging rates 100 bucks.

Okay. 1200 bucks as your average lifetime customer value. Okay. Got 1200 bucks now. Do you have that number as an owner manager to please.

I'd love to have owners and managers have these kind of talks together. Okay, but every day, on the same team. Okay, now we have that. Well, how much we're willing to spend a to get the customer to call us on. We all know if they call you and you have availability, you're gonna get the rental. Okay? It's pretty hard to screw that up, but along just getting that call in the first place and having availability, could you get that customer and you're gonna make 1200 bucks on the back end?

How much you're willing to spend that friend to acquire that customer? You get that customer in the first place. I didn't call you and not to knock the industry, but it just seems like a lot of times people have only asked that question before.

Just haven't you know, we're just kind of spoiled in industry of just being like cool. I'm gonna build it and they will come kind of mentality, which hey, in the past, that was totally true, you know?

Didn't have to do very much. Just had a hang up a sign to say cool. I'm open and boom, you're getting reynolds. Not anymore.

I mean, way don't know that writing that z cats out of that, you know, everyone knows, uh, story is amazing investment.

So more and more people coming in that's more and more competition. It gets noisy t to get the attention to say, you know, call me rent from me because a lot of other competitors are doing the same thing. Uh, they're doing it right.

And so yeah, it takes more and more to get the attention initially to get that to get the round. So what you have the mentality of? Okay, well, what am I gonna do to get to stand out now? You're getting the mind set up marketing.

Okay, once you're in that mindset of marketing, okay, it's gonna cost money to market. There's definitely some free things you can dio. In fact, i'll getting all of that kind of stuff later on, too. I got a whole lot of of episodes planned out, talking specifically about some low hanging fruit freeways to market to get free rentals. Basically, but yeah, let's just be real.

You have to pay to play in a lot of places. Okay. So okay. You got your google pay per clicks. Yeah, that you're looking at.

Every time someone clicks that button toe, come to your website that's gonna cost you money. But if you have that, those figures off.

What are you willing to spend to get that customer? You know, if they come to your website, they call, you're gonna get that, reynold you start justifying, you start justifying that.

You know, I have some clients, and i'm spending well over $1000 a month on google paper clicks. But I know i'm getting 10 times my money back, um, minimum on the back end.

So i'll do that all day long just to run up. Of course, you got your spare foots of the world, and they actually kind of show you when they get a get a rental. What you're kind of expected are always in the back end because they understand that they want to be able to draw that in your head of yeah, it's an expense.

But they're making this on the back end, okay? And I actually commend them for putting in on there on the website. Uh, showing that what that are, why is because that's very, very important concept.

But again, i'm willing to spend that kind of money when I see if i'm getting that ronald making this on the back end. Cool. I know how much i'm willing to spend to acquire customer.

Makes my decisions. So, so much easier. Especially like when I take over a new site is when the first conversations I have with owners, because gonna make some my job so much easier later down the road or line doing marketing campaigns. And i'm showing them the p and l yeah, e get all owners. And they look at these expenses love ups. It's always expense, expense, expense. And they kind of fix it on that.

But it is an investment. Okay, it really is. And once you kind of in fact, i'll do this later on, too. But have, like, our I console and it destroys you, is that much i've spent to acquire the customer so that much mind that add costs was costing me, you know, per to get that phone to ring.

But look on the back end, i'm making 1000% or away uh, it just makes decisions so much easier when we're doing different marketing campaigns, how much we can pay for referrals.

Just everything that starts flowing so much better. Okay, so that's today. That's it. Gets a little homework assignments. I mean, that's watching this. That's current.

Operator, you're maybe you're about ready to open. You already have your unit pricing set up. Do this exercise. Okay, find out what your average lifetime customer value is.

Uh, and then, yeah, that will start making all your market decisions later on. So much easier because you're going to know how much you're willing to spend to acquire a customer.

And once you just have that foundation set, you'd be slap. You did okay, and you could be ahead. A lot of the competitors that aren't doing that are asking these kind of questions you'll learn about anymore that where you get to know each other and talking here.

I asked a lot of questions. Okay. Ask a lot of questions of myself. I'll ask a lot of questions of my owners and managers. I talked. We all kind of started building this together and getting that's energy, and we run some very successful properties that way. So it's fun.

So again, thank you guys for being a part of this listening. Joining on live video. It's it's great.

Really appreciate it. So take care. I'll see you guys tomorrow. Alright, cool. Done and done.

We get on here. Sweet. Just got some more people still on. So again, uh hey, what's up with them? Thank you.

Glad you liked it. Yeah. So I again, I can I can pretty much school on all day. But I just sat here just a a r session with jim and just talk.

I could talk all day about this kind of stuff. I don't want to do that. You know that z wanna hear myself talk that long, and nobody will get value out of of doing that much at one time. Serving duties 15, 20 minutes. Segment today.

Okay, bite size, because yeah, it's a pet peeve of mine. A people listening. Great, but this is also meant to be active. Okay? It's not just being like having in the background, drinking a coffee and calling it good.

No, I want people to actually take action. What? I'm talking about the whole point. You know, uh, I get if you're not in storage, you're dipping your toe into it.

Fine. I get it. But still education, especially those that are current operating there, there existing a lot of the stuff you could implement day of.

You know what i'm talking about? These certain things and action items on what to dio. Cool. Listen to it. Hit, pause, focus on and get it done. Knock it out and it just starts building upon itself.

Um, because again, everything i'm talking about, it's not just to hear myself talk. It's it's there for a reason it zero. To help build businesses, maximize your operations, maximize your marketing, your cells and your revenue.

And, yeah, the highly successful self storage property. So cool haitian. Thanks for coming on. I I just it's called stream murder.

I just always try different programs. I think I actually like this program now, actually, a songs people granted permissions. I can see everyone's feed in the comments and see where they're coming from. Like dan facebook. Whatever kind of put them all in one spot, but you have to grant permission for and see your name.

Otherwise, it just says your facebook or linkedin users. So, like we do that can see the faces and the names so cool. Thanks so much guys.

Again. I will be back tomorrow. All right, take care. Yeah, yeah.

 

Once you understand what your average lifetime customer value is for a self storage customer you must ask yourself the question..."how much am I willing to spend to acquire a customer?"

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