There Is No Safety In Numbers

Recent reports around the industry are confirming what we all know, “open play is down and league starts this fall were off by more than 5%."

Proprietors all over the country are calling each other to find out "how the other guy” did and if his/her numbers are the same as ours.

Ok, so now you know that your numbers are equal to, slightly lower or slightly higher than the other guys. Does that make you feel safe?

It’s easy to take solace in the fact that there are other people worse off than us. I guess that’s why we slow down when we see a traffic accident; to feel better about ourselves and thank the universe it isn't us in that wreck (and to pray for the people who are in it).

But it may be a false sense of safety. Even though November and December numbers are showing some improvement, it is way too early to say that the business is “back to normal.”

I don’t think "normal” will ever return. Not in market that has been economically shell shocked; an unemployment level that is stuck at 9.7%; and the threat of looming inflation.

What to do?

• Double down on your best customers. Go after your best customers with special offers if they bring a friend bowling; provide them with food and beverage specials; develop offers for families ("Hey Moms and Dads, bowl at the same price as your kids”).

• Create more fun. Get that fun person to MC your cosmic bowling nights. Add fun prizes, trivia contest, dance contests, bring in a local band and split the door charge with them (charge $7 or so and give them $3.50). Have your staff dress up in funny hats on Saturdays and Sundays; hire a magician for the kids/families on weekends.

• Get your employees pumped up. You’re selling team building company parties, holiday parties to the corporate market, but what are you doing to keep your employees motivated during your peak season? Are you constantly preaching customer service??

• Get out of the building. You can’t make any money sitting on your *%^@*! Whether it’s you or your manager or your husband or your wife, somebody has to go out and do a sales blitz in your community. Sell short season 8 week leagues, team building events, adult child programs, and distribute lots of coupons offering $5 off, $10 off bowling (based on a purchase of $XX). Just do it.

• Advertise. Tell somebody you are out there; that you have an entertainment option for families, young adults, and kids. Cable TV is your best buy. Buy prime time; target 18 to 34 yr olds for weekday open play after 9pm or for cosmic bowling or females 25 to 44 for family programs.

• Social marketing. Learn it. Study it. Get good at it and use it to build relationships with your customers. Continue to build your data base and use it (don’t abuse it) to communicate the benefits your center offers.

There is no safety in numbers. The only real safety is between your ears and your ability to do 21st century marketing.

Third Eye Blind

Good marketing people know that the key to marketing success is having a product that people want to buy. No mystery here.

But great marketing people know that they need to CONSTANTLY either, improve upon their existing product by adding (or deleting) features to the product or finding a new market segment for the product. If you can do both, you are a mastermind marketer.

In our world we have two categories of products, “league play” and “open play”. (Some purists would say “tournament play” is a third category, but I include that in an “organized open play category on my DSR, daily sales report)

No doubt you have sepnt countlesshours and monies to improve your lineage and revenue in both of these categories You no doubt have devoted countless hours to develop open bowling “specials” andspecial pricing models

You have been working on these issues, it seems like, forever.

While short season bowling has been an important part of the marketing mix fro a long time, it is only within the last few years that many more proprietors can see how valuable this product is to attract open play bowlers to participate more frequently (more than their current level of 2 or 3 times annnual visits). And because of the lesser time commitment, it is far more appealing to the new bowler as well.

This new product category; a third eye so to speak, is a hybrid of league and open play. Very simply, it is short season bowling (8 weekly sessions or less qualifies for this category). Usually two games and typically for a period of less than 8 weeks.

Sometimes it is offered with a premium; other times with an optional premium. And still other times, no premium at all. It can be for kids only, adults and kids, or even adults. It is this latter category where I believe the greatest opportunity exists

The consumer appeal for this type of product is;
• No long commitment,
• No great bowlers to compete with
• Inexpensive total cost (6 to 8 weeks vs. 32 weeks) price relative to longer
season length and 2 game format gets me home earlier
• Get premiums
• Win fun weekly prizes
• No complicated “league rules”

USBC tells me that there are 1.7mm sanctioned league bowlers and this number is off over 6% this year. Wasn’t it just 3mm bowlers a minute ago?

Years ago, the league bowler penetration rate against all adults was almost 10%. Today, with 1.7mm USBC bowlers, less than 1% of all adults in this country over the age of 18 bowl in a sanctioned league. So clearly the appeal of the long season league bowling has dwindled…and dwindled.

Marketing this NEW product (8 week leagues or less) to a new generation of 18 to 34 years old customers is what the NEW league marketing strategy is about.

Let me know how you do with marketing this product.

Price Revisited

Few business owners realize the powerful leverage that lower prices can have on their profits. To get a feel for it, consider this hypothetical example.

You own a bowling center and you normally sell bowling at $3 per game and shoe rentals for $3.00 per pair. On a transaction of two games and shoe rentals, your revenue is $9.00 per game.

After calculating your fixed costs and variable costs, you estimate that your costs per game are about $1.00 per game and shoe rentals about $1.00 each. On this transaction, you make $6.00 for a 67 percent gross margin.

After keeping prices at this level for five years, you raise the price to $3.60 per game. That’s a 20 percent increase — not small. But it’s nothing compared to the effect on your profits. Say 200 people buy the $9 package each week. At $10.80, 20% less games are bowled. But even at 20% less, the business makes 3% more profits. Details:

Price Transactions Revenues Costs Profits
$9.00 200 $1,800 $600 $1,200
$10.80 160 $1,728 $480 $1,248

What happens when you cut prices? Say you drop it by $1 or 11 percent. At $8, you sell 20 percent more games. Revenues climb about 9% or $136. Costs per game stay the same, so total costs increase 25 percent. You make almost 3% less money for working harder. Details:

Price Transactions Revenues Costs Profits
$9.00 160 $1440 $480 $960
$8.00 192 $1536 $600 $936

When does cutting prices dramatically increase profits? The answer may surprise you. If you cut prices about 10 percent, you have to have 18 percent more transactions to make more money. At $8, you’d have to do 188 transactions to beat the $960 profit you got from 160 transactions at $9 each. Your extra profit comes to $1. Details:

Price Transactions Revenues Costs Profits
$9.00 160 $1440 $480 $960
$8.00 188 $1504 $543 $961

On the other hand, if you raise prices 25 percent you’d have to lose almost one out of three customers before it hurt profits at all. Details:

Price Transactions Revenues Costs Profits
9.00 160 $1440 $480 $960
$12.50 115 $1440 $690 $950

If you’re cutting prices without having a strategy to sell more ancillary products you’re going to need a lot more new customers than you might have suspected to avoid losing money. Just driving traffic in the hopes of selling more food and beverage is not a strategy.

But driving traffic with a clear goal to sell more food and beverage is a very viable strategy.

Need A New Idea?

Sure you need a new idea, but if I gave it to you what would you do with it? Would you say, "Just cant get to it", "Don't have enough time", Can't get my people to do it? Maybe.

And then when it doesn't happen or happens half a***d, would you say, "we tried it, it didn't work." But would you ask why it didn't work?

What didn't work? The idea? The effort? The communication? The timing? Doesn't matter. It's easier to blame the idea. Poor, pitiful idea. It gets no respect

Yet, there are more new ideas out here than ever before, more ways to get the customer to buy than ever. The Internet has more marketing information to stimulate your brain than you can possibly absorb. There ARE no shortage of ideas, but there are idea killers.

The biggest killer of the new idea is because "YOU don't like it." Or your spouse doesn't like it. OK, admit it. You didn't like it. It's OK...if you recognize that. Just make sure you ask a potential customer or ten if he or she likes it. Because that is really all that matters, isn't it?

The new idea, the great idea, the new product you have been looking for is THE CUSTOMER.

Be Different or Go Home

Bailouts, bankruptcy, foreclosures, unemployment.

The news just doesn't seem to get better. In fact, it seems that it is getting worse. But even among the dozens of proprietors we see each month, these are a few that are going against the trend and actually showing increases.

What are they doing that you may not be doing?

Here are some examples:

"I have had a salesman out in Fort Worth since July. Today we got Citi Insurance group with 70 women to bowl at 1PM and pizza and soda, they were whopping and hollering and having fun. Team building, they drank like fish from the bar. Tomorrow 70 more will come and 40 more Friday. Our holiday parties look great. Last weekend we had the best weekend since we purchased the center. We are working on live bands two nights a week at 10PM. First night we did $2400 in the bar. Also we started two leagues on the weekend. It is out there for the getting:-)"
J. Brooks, Texas

"Since we have started our Rewards Card Program, I have seen people coming in more. They like the idea of CASH BACK REWARDS. They also love it when we do drawings. I go out and get other businesses to donate prizes, like 30 day memberships to a gym, a free med. pizza.

This week end I invited a Chiropractic office in to do FREE 10 min. Chair massages. The customers loved it! I had people coming up to me and asking when the next drawing was going to be. They did not want to leave if the drawing was going to be soon. I gave FREE games of bowling away as prizes. In order to get the FREE games they had to have our Rewards Card and they had to activate it. We gave out lots of cards.

People will be back because they are going to want to use their FREE games! So, what's our new product? The customer is our new product. We reward them. Do fun things. Give them things for doing what we want. You want free games, sign up for a rewards card. You want to win that prize, stick around a little longer for your chance to win. (Three people I talked to stuck around for the drawing. Two out of the three went to the snack bar and spent around $20.00 each.)

We make them feel special by sending our top 100 customers an e-mail flier telling them how happy we are that they are our customer. Bring this flier in and we will load an extra $5.00 on your rewards card. These are some of the things we are doing and we are seeing results.
D. Nichols, KS

To make it in this competitive environment, you not only have to be better than ever, but you have to be overwhelmingly different enough to get the consumer to make a purchase decision.

So what are you doing to be overwhelmingly different?

Chutzpah

The word "chutzpah" (pronounced hootspah), in Yiddish, means gall, nerve, tenacity, and sometimes an often used word describing a man’s genitals.

However, the word is basically untranslatable without a story.

One day there was an old woman who was selling pretzels on the corner of 47th street and Madison Avenue in Manhattan. A young man from an ad agency saw her and went over, put down a quarter and never took the pretzel. Everyday, he would pass her and put a quarter down, but never take the pretzel. They never spoke, but only exchanged glances. This went on for weeks, months and even years. Three years to be exact.

Then one day, the young man comes down from his office, walks over to the pretzel cart and puts down his quarter. Just as he was about to walk away, the woman turns to him and says, “We had a price increase, pretzels are now 35 cents."


Moral of the story: Don’t wait so long to increase your prices. :-)

What's Next?

As much as we talk about training employees, hiring employees and getting better employees, it seems that even with these changes, we improve our business, at best, in small increments. Sometimes you get lucky and you find a superstar or someone with the potential to be a superstar.

More frequently, you hire someone with more experience. someone who knows what to do NOW.

But what you really need is someone who knows what to do NEXT.

A new manager comes on board and after a few weeks impresses you because she developed and built a new short season league in a spot you have been struggling to fill. But what is she going to do next? What is her plan for these people after they finish their 8 to 10 week program?

"Rolling them over" is a strategy that we hear frequently and it can take on many faces, but the really good person, the person you need on your staff is the person who knows what to do next and knows what to do next when they are implementing the NOW program.

The continuity of business today requires a dynamically flowing process. Not one program and then another, but a strategy that builds upon each program and (customer) experience and has the next step process built into the initial implementation.

Think of it as playing pool. When you get the shot to sink the seven ball in the side pocket and it is a virtual "gimmee", the important part of the shot is not sinking the seven ball.

No, the important part of the shot is where the ball ends up (the position) after the shot so it can set up the next shot!

Who in your organization plays pool and knows what to do NEXT?