In self-storage, marketing is too often treated as an expense.
A landlord’s default posture tends to be similar to how they might approach selecting a landscaper. The cost is scrutinized aggressively like any other expense line item.
This approach makes sense because self-storage is a fixed inventory business. You don’t improve performance by selling more product. You do so by managing what already exists better.
Historically, that’s pushed owners toward a very specific playbook for increasing NOI:
- Keep occupancy high,
- Raise rents, and
- Control expenses
Within that framework and probably because of where it sits on an income statement, marketing naturally looks like something to be reduced, not an opportunity for value creation.
The issue is not that this logic is wrong. It’s that it’s incomplete.
Why Lifetime Value Matters
This way of thinking frames the business almost entirely at the asset level. Unit, occupancy, rent roll, expense ratios, etc. These are important high level KPI’s but gloss over the fact that self-storage is also a service business with real unit economics at the tenant level.
Once you shift your lens from “How is the building performing?” to “What does an average tenant look like economically?” marketing becomes much easier to reason about.
I gave a presentation recently that centered on this shift. Not to argue that operators should spend more on marketing, but to explain that self storage marketing only behaves like an expense when you don’t know what you’re getting back.
A storage tenant isn’t a one-time transaction. They’re a stream of cash flows over time. Average length of stay, average in-place rent, and operating margin matter far more than the first month’s rent.
If you have even a rough sense of those inputs, you can estimate lifetime value. And once you can estimate lifetime value, marketing spend becomes an investment decision instead of just an expense.
That doesn’t mean marketing spend should always be high. In fact, a full facility should reduce the marketing budget. As availability tightens, conversion efficiency deteriorates. Fewer unit sizes, less flexibility, and higher prices all make it harder for prospective tenants to say yes. At that point, incremental marketing dollars produce fewer move-ins.
Where things tend to go wrong is when that same cost-cutting instinct gets applied universally, regardless of occupancy, demand, or stage of lease-up. Marketing gets treated as a static expense instead of a performance lever.
Getting a Clear View with LTV:CAC
With a simple monthly cohort from your facility management software (FMS) and a view of marketing spend, you can get surprisingly close to understanding your own tenant unit economics.
Ultimately you are trying to solve for tenant lifetime value (LTV) in relation to the cost to acquire a tenant, or customer acquisition cost (CAC).
To measure LTV:CAC, you need to know:
- How many tenants did I acquire this month?
- What did I spend to acquire them?
- What does an average tenant look like in terms of rent, length of stay, and margin?
Once you can see that ratio, you can make informed marketing decisions and hold your team, self storage marketing agency or the key decision maker accountable.
None of this is meant to suggest marketing is a silver bullet. But if we continue to evaluate marketing purely through the lens of cost control, we miss the chance to treat it like what it really is: an investment that can be measured, adjusted, and compounded.
About the Author
Peter Smyth is the Cofounder and CEO of White Label Storage, one of the fastest growing storage management companies in the US. Ranked in the top ten facility management companies by Inside Self Storage, White Label Storage provides end-to-end storage management services that help owners and operators increase revenue and maximize asset value.
Source: White Label Storage
