Unlocking Revenue Growth With Value-Based Pricing in Self-Storage

The self-storage industry is experiencing a significant transformation. With growing competition and rising customer expectations, traditional pricing strategies like undercutting competitors are no longer enough to guarantee success. To stand out and generate sustainable profits, self-storage operators are pivoting to a more innovative approach: value-based pricing.

This powerful strategy shifts the focus from price wars to delivering exceptional value that warrants premium pricing. But what exactly is value-based pricing, and why does it work in self-storage? More importantly, how can you implement it effectively? Let’s explore.

What Is Value-Based Pricing?

Value-based pricing is a strategy where rental rates are determined by the perceived value of the services and amenities offered, not just the size of the unit or what the facility next door charges. Instead of competing solely on price, you justify higher rates by understanding and providing what your customers value most.

For instance, services like climate-controlled units, enhanced security measures, extended access hours, and personalized customer support are all potential value drivers. If these align with your potential customers’ needs, they’ll likely pay more for the peace of mind and convenience these features provide.

Why Value-Based Pricing Works

Modern renters aren’t just looking for the lowest price. They want quality, trust, and convenience. A study from Storable highlights that tenants are willing to pay a premium for properties offering heightened security, superior service, and easy access. By aligning your pricing model with what tenants value most, you tap into a market that rewards service over discounts.

How to Increase Perceived Value

Building perceived value requires a deliberate investment in services and features that appeal to your customer base. Here are some tried-and-true methods for boosting your facility’s value:

24/7 Access and Convenience

Life can be unpredictable, and renters value the flexibility of accessing their belongings at any time. Offering extended or 24/7 gate access can instantly elevate your facility’s appeal.

Enhanced Security

Investing in modern security measures like keypad access, high-definition cameras, alarms, and well-lit areas can set your facility apart. Security is one of the largest concerns for renters, and facilities that demonstrate a commitment to safeguarding belongings often command higher rents.

Facility Cleanliness and Maintenance

Curb appeal isn’t just for homebuyers. A well-maintained, tidy storage facility signals professionalism and instills confidence in prospective tenants.

Extra Services

Offering bundled services such as renter’s insurance, locks, boxes, or tape creates added convenience without cutting into your profits. For example, providing a complimentary lock with move-in is a small investment that builds goodwill and justifies higher pricing.

Website Design: The Curb Appeal of Your Storage Facility

Just like a physical storage facility, your website serves as the first impression for potential renters. A clean, modern and user-friendly website can make all the difference in attracting customers to your facility. Think of it as the “curb appeal” of your business online.

User-Friendly Features

To ensure your website is attractive and easy to navigate, consider incorporating these user-friendly features:

• Responsive design: With more people accessing websites on their mobile devices, it’s important that your site is optimized for different screen sizes.
• Intuitive layout: Your website should have a clear and organized layout, making it easy for users to find the information they need.
• Fast loading speed: In today’s fast-paced world, people expect websites to load quickly. Make sure your site is optimized for fast loading times.
• Clear call-to-action buttons: Encourage users to take action by including clear and prominent call-to-action buttons throughout your website.

Engaging Content

In addition to user-friendly features, your self-storage website should also have engaging content that draws in potential customers and keeps them on your site. Consider incorporating:

• Professional photos: High-quality photos of your facility can give potential customers a realistic view of what you
• Clear call-to-action buttons: Make it easy for visitors to take action by prominently displaying buttons for things like booking a unit, contacting your facility, or requesting a quote.
• Virtual tours: Give visitors an interactive look at your facility with virtual tours. This can help them get a better sense of the space and amenities you offer.
• Customer testimonials: Positive reviews from satisfied customers can go a long way in building trust and credibility for your self-storage business.
• Blog posts: Regularly publishing informative and engaging blog posts related to self-storage can not only attract potential customers but also position your business as an industry expert.

By incorporating these elements into your website, you can create a more dynamic and visually appealing online presence that sets you apart from competitors.

SWIVL AI Navigation

SWIVL has revolutionized the self-storage experience by integrating advanced AI capabilities that streamline tenant interactions. Through its partnership with Storagely, SWIVL introduces features like the “Unit Connect” technology, which intelligently matches prospective tenants with available units based on their specific needs, guiding them directly to the checkout process. This seamless integration reduces the steps required for booking and significantly increases conversion rates by minimizing drop-offs during the rental process. Moreover, SWIVL’s AI-powered chatbot operates 24/7, providing instant responses to inquiries, assisting with reservations, and managing customer accounts, thereby enhancing the overall user experience and operational efficiency for self-storage operators.

The Role of Technology in Value-Based Pricing

Technology-driven services have become game-changers for value-based pricing in self-storage. Here are some examples of innovations that can boost your offering:

Online Rentals and Gate Access Apps

Streamline your tenant’s experience by allowing online rentals, payments, and access management via mobile apps. Customers love the convenience of digital tools that offer instant access to their storage units.

24/7 Support With Call Centers

Missed phone calls can result in missed rental opportunities. XPS Solutions mitigates this risk by offering professional call center services, ensuring that potential renters receive assistance outside of standard office hours. XPS provides 104 hours of weekly coverage, helping to save over 50% on employee costs. A single missed call could mean lost revenue, but with XPS, every inquiry is answered by Call Center Agents who have expertise in self-storage. Additionally, XPS offers U.S.-based Call Center Agents and Remote Managers who are knowledgeable about the rental process and can effectively identify tenants’ needs to increase rental conversions.

Quick Stat:

More than 60% of storage rentals start with a phone call. 40% of those potential tenants will choose to rent from the first facility they contact. Facilities that ensure every call is answered see much higher leasing rates, which increases their net operating income (NOI).

Reliable & Secure IVR Integration

Effective communication channels are essential for enhancing tenant satisfaction and driving NOI. Equally important is providing flexible payment solutions to minimize delinquencies. XPS Solutions offers a robust Interactive Voice Response (IVR) system, enabling tenants to make secure payments anytime, from any location. This 24/7 accessibility not only improves the tenant experience but also streamlines operations for facility managers.

Deploying Value-Based Pricing in Your Facility

Adopting a value-based pricing model requires a structured approach. Here’s how to start:

1. Understand Your Customer Needs

Start by assessing what your customers care about most. Use surveys, reviews, and data from past tenant interactions to identify their priorities. Do they value convenience, security, or cost-saving bundles? Knowing this will guide your pricing strategy.

2. Segment Your Units by Value

Not all units are equal in desirability. Create pricing tiers based on features like location, size, climate control, and ease of access. For example:

• Premium Units might include climate-controlled spaces close to entry points with extra security measures.
• Mid-Tier Units could feature non-climate-controlled options or units on upper floors with elevator access.
• Economy Units could serve price-sensitive customers requiring basic storage.

3. Train Staff to Communicate Value

Your team should be well-equipped to highlight the unique value propositions of your facility during rental inquiries. For example:

• Instead of advertising “Units starting at $50/month,” emphasize, “Secure, climate-controlled storage with 24/7 access for $100/month.”

4. Test and Adjust Pricing

Roll out your value-based pricing in stages to monitor performance. For instance, you could implement it at one facility and compare revenue growth and customer feedback with another location using traditional pricing.

5. Highlight Value-Focused Messaging

Change how you market your services. Draw attention to the reasons behind your pricing to educate potential tenants. Messaging examples include:

• “Protect your belongings with 24/7 video monitoring and secure access.”
• “Maintain the condition of delicate items with climate-controlled units for as little as $XX.”

Real-World Success With Value-Based Pricing

Imagine a scenario where a facility previously relied on discounts and low pricing to fill units. After adopting value-based pricing:

• Premium units featuring climate control and coded gate entry were created.
• Staff began emphasizing benefits like free rental insurance during tours and calls.
• The facility partnered with XPS Solutions to ensure no rental inquiries were missed.

The result?

Occupancy rates increased, average rental rates rose by 15%, and tenants expressed higher satisfaction levels, boosting retention.

Partner With XPS Solutions to Strengthen Your Value Proposition

Effective value-based pricing requires more than standout offerings; it necessitates stellar customer service to back it up. XPS Solutions provides the tools to boost your facility’s customer experience:

• Call Center Services: Ensure no lead is lost with trained professionals who answer after-hours calls and provide seamless support for new and existing tenants.
• Remote Management Options: Enable cost-efficient management across multiple locations without sacrificing quality. XPS Solutions Remote Management Services provides an additional 54 hours a week with their 104 hours of call coverage, handling lease signature audits, making payments, inbound lead follow-ups, move-out process, & backups.
• Tenant Support Tools: Offer flexible payment plans, mobile apps, and immediate support that tenants value. XPS Solutions has also just launched MyStorPal 3.0, which helps communicate with tenants, and provides the following features: Move-out process, unit inventory management, raise a concern, seamless payment solutions, and multi-unit facility support.

This integration not only reinforces your rental rates but aligns perfectly with a value-based approach.

Take Revenue to the Next Level

For self-storage operators, the key to thriving in a competitive market is understanding your worth and backing it up with superior services. Value-based pricing is your ticket to moving beyond cutthroat price wars, attracting loyal tenants, and unlocking sustainable growth.

Want to learn more about taking your self-storage business to the next level? Get in touch with XPS Solutions today at xpsusa.com/contact.