Marketing Strategy for a Self-Storage Business free essay sample

WK Investments operates 4 self storage facilities in the Midland/Odessa area. These facilities operate as Loop 250 Self Storage Center and Midkiff Self Storage Center in Midland, and as West County Road Self Storage Center and Grandview Self Storage Center in Odessa. While the company is the market leader in this area, we feel there are certain measures the company can take that will help both maintain a market leader position and possibly attract new customers. WK Investments currently has a strong market position as a leader in the market.They do have higher prices than the competition; however, the current position allows them to be the price setter in their perspective markets and their prices are justified with their superior products/services. In researching the customers that use the facilities most often, we recommend the following market segments to focus on: * Homeowners * Renters * Vehicle Owners * Renters The marketing strategy that we recommend for the company is a strategy of differentiation. We will write a custom essay sample on Marketing Strategy for a Self-Storage Business or any similar topic specifically for you Do Not WasteYour Time HIRE WRITER Only 13.90 / page We feel that this approach is best suited for the company because their product is superior to competitors in the area.Because we want to highlight the special features of each location as well as the superior service, we feel that the differentiation approach would work best for this company. After a careful analysis of the company’s customer, the competition, and other internal external factors, we have come up with various tactics to help enhance WK investment’s marketing strategy. THE CHALLENGE We believe that these self-storage centers offer the best storage facilities available. However, the Midland/Odessa self-storage market is a mature market. There is not very much room for growth. Therefore, an aggressive marketing approach is needed to target customers and let them know that their storage needs are unfulfilled. We need to analyze the competition to see that none of our present business is stolen while attracting new customers. SITUATION ANALYSIS Company Analysis WK Investments strives to have higher quality storage units than the competition. Their focus is to target the female demographic of the selected target markets. This means making the facilities comfortable for women so they feel safe when they are on the property, especially at night. To chieve this, proper lighting is used as well as soft music to help create a comfortable atmosphere. The self-storage centers’ culture is focused on convenience as well as piece of mind. Prices may be slightly higher than that of the competition however, the prices are justified with the fact that customers are getting what they pay for. There are four self-storage locations which allow the company to serve a better customer base than competitors with only one location. While the staff is trained with the customer in mind, they are able to provide the best customer service available.Customer Analysis Typical customers are homeowners between the ages of 25 and 65, generally married and living within 3-5 miles of a storage location. The majority of other customers are businesses, in either the service industry or a doctor’s office. Most customers use the storage units to store excess belongings. Some use them while they are in the process of moving and others use the units during a divorce. Based on surveys performed by the company, the majority of customers choose WK Investments because of the location, and secondly because of the features.The management staff is also a major factor in why customers choose these facilities. Competitor Analysis There are a variety of competitors for a self-storage facility. There are numerous other self-storage facilities in the Midland/Odessa area. Although these properties do not meet our standards for quality, some facilities offer new customers incentives such as coupons and/or discounts. Our company offers a $25 gift card to existing customers for each referral made; however, we do not distribute coupons or offer seasonal discounts because we feel like this tactic would dilute the image of the facility’s quality.These companies tend to offer seasonal sales or discount pricing; but at the same time, the customer has to make a very expensive purchase that requires a permanent fixture on their property. In contrast, our storage facility offers an affordable monthly payment, rents on a month-to-month basis, and gives customers a choice of short-term or long-term usage. Our last form of competition comes from contractors who build custom storage fixtures. Once again, this form of storage is very expensive and requires a long-term commitment, while our storage facility is inexpensive and offers flexibility.Climate PESTEL Analysis * The political environment is up in the air at this time. It seems that more emphasis is being put on the government to help small businesses. However, it is unclear at this time whether the tax laws will be changing in the next year. This could either hurt the company financially or be beneficial. * The economy has been sluggish in recent years. However, it appears that the economy seems to be on the upswing which will allow customers to better be able to afford self-storage facilities, which in turn, would be very good for business. Social Trends show that younger generations are living with their parents at older ages. * There is more emphasis on using the internet to find service needs. Social networking sites are becoming an essential base for marketing to the public. * The west Texas weather is highly volatile with extremely hot summers and fair winters, along with high windstorms. * There seems to be a steady legal environment. SWOT Analysis Strengths The company is the Market leader in the area. With 4 locations, it is conveniently located near you wherever you live, within the area.Customers know and trust the company for the measures that are taken to store and secure their belongings. The on-site staff is friendly, trained and focused on keeping the customer happy and assisting with any needs they may have. Weaknesses While people are always finding that there is something they can store and do not have room for, one weakness of the business is that there are no contracts. Contracts are on a month-to-month basis which is good for the customers but does not guarantee revenue. All locations go by a different name, which can cause branding issues when people are not able to associate the each location with the company. Also, there is a limited amount of staff available to serve customers which could cause customer service issues. Opportunities Improving economic conditions could mean that there is more business to be done. Increasing leisure spending means that there are likely to be more recreational vehicles to be stored. In the past few years, marketing via paper outlets is becoming obsolete, however, internet and social networking mediums provide for more awareness at lower costs. Threats On average, each location needs to reach 65% occupancy in order for the bills to be paid.Safety is a main requirement for this segment and the more cameras, safety systems and gates, the better. The best way to reach this segment is by website, radio and TV. Home owners usually have a price sensitivity of moderate. Segment 2 * Renters ranging in age 18 to 55, want and inexpensive, but safe place to store their belongings while renting a home, apartment or dorm. They use storage facilities by storing the belongings that they do not have room for at the facility they are renting from.Support Requirements include safety, cleanliness, accessibility are some of the requirements when renters are searching for a place to store their belongings. The best way to reach them is by website, TV, flyers, radio. Renters usually have price sensitivity of high. Segment 3 * Vehicle owners ranging in age 35 to 60 want a storage that protects their vehicle as well as easy access. They use storage facilities by storing vehicles such as boats, motorcycles, RVs, and collectables while not in use. The support requirements include accessibility, cleanliness, and reliable security systems.The best way to reach this segment is by website, TV, flyers, and radio. Vehicle owners’ price sensitivity is usually moderate. Segment 4 * Business owners ranging in age 40 to 60 want a clean and safe storage facility to store business supplies. They use the product by storing equipment that is not in use, or is in the way at their business. Support requirements include large storerooms, easy access, security, cleanliness and accessibility. The best way to reach them by mail outs, flyers, and website. Usually price sensitivity is between moderate and low. WK Investments is the market leader in the Permian Basin offering a superior product and service. These self-storage centers are in a strong enough position to be the price setters, so we feel that skimming would give a beneficial return to the company. We also suggest that they dedicate plenty of resources to their advertising campaigns and suggest that they try to make more of an internet presence for themselves. Because we feel that this market is already saturated, we do not feel the need to expand in this area. However, the company may want to look in similar markets to Midland and Odessa for expansion opportunities. Product WK Investments provide self-storage facilities in four different locations in the Midland/Odessa area. In Odessa, they operate as Grandview Self Storage and West County Road Self Storage. In Midland, they operate as Loop 250 Self Storage and as Midkiff Self Storage. While the actual storage offerings of each location may differ, each of the locations includes the following: * Security * 24/7 surveillance * Keypad entry * Sealed storage units * TV monitoring * Lights on every building * Cameras strategically located on corners and center of site * Site activity map Convenience items * Packing supplies for sale * Moving equipment rentals * Amenities * Various sizes of rental units * Air conditioned units available * Dust control units available Most of the selling of storage units is face-to-face, therefore, the company needs to make sure to invest in customer service training for each of their employees. The first impression makes a lasting impression and as m arketing research shows; not very many people choose one of these facilities based on price. It is usually based on convenience with most customers living within a couple of miles from each of the facilities.Therefore, the customer service of the employees has the potential to make or break the sale. Price Because WK Investments is the market leader in this area, we recommend a skimming strategy. The self storage centers are differentiated enough and have a large enough presence to be the price setters in this market. Below is a table of the rates offered by all four locations. As noted below, there is a set up fee and a deposit required for the storage facilities. However, there are no contracts associated with the storage rental. A disclaimer is given to all potential clients letting them know that rates are subject to change at any time.