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Extra Space Storage® has a team dedicated to making strategic pricing, discounting and renewal rates as fast as the market changes. The group of revenue managers work in the field with site managers 25% of the time so that they understand the properties needs. The revenue managers have worked closely with the IT team to create property price “triggers”, a dynamic real-time pricing application. Much like an airline pricing model, the “triggers” automatically adjust rates based on unit supply, current demand, and competition. In today’s competitive climate, revenue is the greatest driver in creating value for your property. Because of this, it is imperative to maximize these revenues using the most advanced revenue management program.
What does Revenue Management do to add value to your property?
Rate Increases
With nearly 400,000 tenants spread over more than 670 properties, Extra Space Storage has the ability to continually test statistical levels of rate increases to find the “sweet spot” between rate and occupancy. The methods and decisions of rate increases have proven to be a true distinguisher among our public and private competitors. Extra Space has traditionally been the leader in pushing existing customer rates as well as street rates.
Competitor Rates
Extra Space Storage shops the four major competitors main unit types for every one of our properties every month. This equates to over 100,000 unit types shopped every month. Doing this ensures that our pricing is based not only on the competitive climate, but that we are charging the true value that our properties deserve as we rank to the surrounding market. Working with the IT team, Revenue Management has a competitor database of over 30,000 competitors including location, property attributes and quality rating, property photos and demographics.
Real-Time Pricing
Our Revenue Managers work closely with Property and District Managers to ensure our street rates are correct. With a combination of ground level qualitative data and centralized quantitative data, pricing triggers using proprietary algorithms are assigned to each unit type. These pricing triggers adjust prices to real-time demand to ensure that we are getting the highest price for the most occupied units and are able to drop price intelligently where needed.
Discount and Promotion Optimization
Because discounting is an integral part of competing in the self storage
industry, it is essential to know when and how much to allow managers to give to
any certain potential customer. Much like triggers, discounting is managed
real-time as demand changes – decreased discounting when occupancy is high and
increased discounting when occupancy is low. In addition, our Revenue Managers
track, test and centrally govern the proper and most powerful discounts on a
continual basis while still allowing site managers the flexibility to adjust
discounting to maximize revenues.
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