The following article was published in the Birthday University Newsletter. Frank did such a great job of explaining the copycat myth (or wannabe syndrome) about inflatable birthday party centers that we are republishing it here. It serves as an important lesson to entrepreneurs currently planning to start their FECs, birthday party centers and other location-based entertainment concepts
Birthday University founder Frank Price provides an insightful article on the inherent dangers of jumping on the bandwagon to copy another business that appears to be wildly successful. Find out how the wannabe syndrome is a direct route on the road to ruin.
Modeling (copying) a business without truly understanding why rarely ever works. Being unique, personalizing, satisfying guests and facilitating positive emotions leaves long lasting memories.
Remember the defunct Discovery Zone concept from the mid 1990s? The company had more than 300 locations, the backing of a huge financial conglomerate and the first major presentation of the “out of the home” birthday party. Whenever DZ opened in a new town, there was tremendous excitement. Families flocked to discover this new fun place to play, while prospective entrepreneurs’ daydreamed about how easy it would be to duplicate. Many of these new business owners looked at this model as the stepping stone to an early retirement. They built similar concepts all over the United States, hoping to be first to cash in with their rendering of this cash cow. Many copied the Discovery Zone concept, added a name, a slightly different look, and in their own minds, added the secret formula to make their versions better. Some just filmed a Discovery Zone and duplicated it, because it was easier. They figured DZ must be doing something right to be that busy. Most justified their idea and investment by saying there was nothing like it in their town and not much for kids to do. This became the beginning of the children’s entertainment center frenzy, and a period where it was common to find eight to 12 of the same type of business competing in the same market for the same consumer. You heard even seasoned executives planning to roll out their version of the business, take it public and strike it rich.
What happened then is still happening now: weak concepts that look, sound, smell, taste and feel the same, but are justified by the early rush to duplicate that which is popular and new. How many inflatable businesses have you seen pop up in the last year? How many have already closed their doors? There is a good chance that like DZ, they will lose their appeal after a couple of short years. Mono-cultured family entertainment/party center consumers get bored and frustrated quickly. They replace their excitement by looking for something new, after the mentality of “been there, done that ... what’s next?” kicks in. If you copied a concept from one of these, you are in double trouble. First, you started out with a shallow business model. You’re scared by now, but you maintain you can still make it work. The problem is, you don’t understand why it’s not working. Maybe history can help.
At the height of the 1990s children’s entertainment shakeout, Discovery Zone closed all but a very few of its 300 locations. Unfortunately, the countless “hope to retire” entrepreneurs and moms and pops who sank everything into their dreams lost it all in a very short time. Let’s look at why.
It was an illusion. On the surface, Discovery Zone looked like the perfect answer to a changing family dynamic whose desire was a safe place to play with their children. It got great press, and most communities welcomed a fresh, wholesome business that brought families together. Entrepreneurs from all types of backgrounds raced to be first in their market, modeling their business after the market leader, Discovery Zone. Most didn’t know the DZ concept was incomplete, one-dimensional and directed by leaders who did not understand their consumers and were too arrogant to admit it.
You must learn from the past. Many made their first mistake by copying what “appeared” to be a very successful and lucrative business. Whenever you attempt to copy another business, critical underlying components get lost in the process. If you do not fully understand how they operate and why, you never truly get business’ intent and won’t be able to communicate who or what you are, either to your guests or your employees. Your guests and employees are the two critical components in the growth and success of your business. Identity confusion in either of these primary influencers becomes the first nail in your new business’ coffin.
You’ll drive the second nail when trying to add your own twist to make it better. Though you don’t understanding the basis of the business or its principles, you add your own personal touch, which begins a sense of “idea ownership.” This kicks in the ego and fortifies a belief that you are building something even better.
As you create your better version, your ideas spring from the belief that parents with children think and act like you. This is a huge mistake and your third coffin nail. You’re just one person within a market, and typically, you don’t represent your ideal customer. The friends and family you gather for feedback to reinforce your thoughts are only a few more people. At this point, your mind begins to close itself off to new ideas, constructive criticism, experienced industry feedback or expert advice. You take on the posture that “nobody calls my baby ugly” and get very defensive. You pound in another nail when you can’t see past your own limiting beliefs.
The fifth nail in the coffin stems from an illusion that exists in almost all family entertainment/party concepts during the first 18 months of its lifespan. The novelty period is defined as, if it’s new, it’s in high demand, no matter how good or bad. If you visit a business during the novelty period, and justify your investment on it at that time, you will be fooled; it’s not the blockbuster business you thought. If you think the business is making a boatload of money because it’s packed on the weekends every time you visit, you will be fooled again.
The final nail: Many perceived “homerun” business concepts are themselves copied. Many are outdated or are led by people who do not understand what they are doing in the first place. They may be moving through their own learning curve, evolving, changing and recreating, as you begin duplicating their prototype. Those who copied Discovery Zone will tell you they learned that lesson the hard way. Some very big companies like McDonald’s, Ogden theaters and even Disney lost their shirts in an attempt to capture their slice of this illusion pie. DZ’s leaders didn’t know what their business was or whom it was for until it was too late. They didn’t understand the market and didn’t listen to those who did. They rolled out more than 300 weak copies, all destined to fail. Unfortunately, those who followed struggled through the pain of an even shorter business life. A copy of a copy is the worst scenario of all. It’s like the Michael Keaton movie, Multiplicity (I highly recommend it): the copy of the copy never turns out quite as planned.
Learn from history, blaze your own trail with a unique concept that has people saying, “Oh yeah, that’s the place where they ________________. Then you can sit back and chuckle, watching others trying to copy you, knowing you will always be four steps ahead. Give them a hammer and the nails they’ll need.
Is history repeating itself? Most inflatable family entertainment hybrids and inflatable party places are back, taking up the same position as the early soft play entrepreneurs of the 1990s. Many seasoned veterans in the industry predicted the same mistakes and warned folks not to make. Unfortunately, history does repeat itself, and many are struggling during the second year of their businesses. It still pains me to hear people talk about investing their lives and life savings into an idea they think is going to knock off current market leaders. Their intention and passions are admirable, but reality dictates a business model must be sound to succeed.
The indoor inflatable anchored centers have followed the familiar path of past indoor children’s play centers. Instead of soft playgrounds as the single attraction, it’s now inflatables. These concepts are beginning to feel like the déjà vu of the 1990s. A year and a half into the business, it peaks and then begins to decline. We should be learning from the past, not repeating it.
Frank Price operates Birthday University and other training programs. To learn about Birthday University, its schedule of 2.5-day programs held throughout the U.S. or to contract Frank, go to www.birthdayuniversity.com.
We also have written about this fatal flaw of copycatting in past issues of this eNewsletter: