The Value of a Customer
By Rick Beal
Knowing the value of a customer at your facility is another tool in your belt to help your business run better. So, what is a customer worth at your facility today?
Why Knowing the Value of a Customer is Important
If you know the value of your customers you can begin to segment them, evaluate your processes, train your employees, and turn a profit for your self storage facility.
Finding the Value of a Customer
In order to find the value of a customer at your facility you’ll need to do some work. To begin, you need to find the average length of stay for your facility.
Once you find the average length of stay you need to find your average rental rate.
Both of these figures can be found by pulling reports in your storage unit software.
Once you find these two figures you can figure out your gross potential. To find this out you will multiply your average customer stay by your average rental rate. For example, if your average customer stay is 10 months and your average rental rate is $100 per month then your gross potential would be $1000 per customer. Therefore, each of your customers, on average, is worth $1000.
What to Do With This Information
Once you know the value of a customer at your facility, what do you do with it?
You can begin to segment your customers and evaluate your marketing efforts. For example, if the average value of your customer is $1000 and you spend $500 on an Adwords campaign and receive 3 customers then you could say that is worth the investment.
You can also begin to train your employees on the value of each phone call, tour, and rental at your facility. In our example, your one phone call, one tour, and one rental could mean $1000 for your facility if your employee is trained to handle the call, tour, and rental properly. If your staff know exactly how much each customer is worth, it will be easier for them to understand the importance of that one call, one tour, and one rental.
Finally, you can challenge yourself to increase that average rental length, and average rental cost. This will help to increase your profits overall.