by Frank Price, President FL Price & Founder Birthday University
Thanks Frank for letting us reprint this informative article from your enewsletter.
Good news, the industry is strong, everyone is busy, which means income is strong and profit is up … for now. Don't get complacent. This is the time smart operators evolve, improve, refine, train, prepare and look to further separate themselves from their competition. They know that when the economy tightens, differentiation, quality experience and human capital will prevail and maintain their revenue. Sometimes doing the opposite of everyone else is the best strategy.
Everyone fighting for the same food. Worth the risk?
A common strategy is shared by many businesses, which all compete for the same group of “cheap” seeking consumers. Discounting remains a “Success Illusion" in the amusement industry. “We are busy … we must be making money!” The downfall of high volume is it's historically short lived, unpredictable and does not always equal profit, but always leads to the depletion of human resources, physical facilities, attraction wear and market burnout. Short-term goal oriented businesses, define their success with this benchmark. Some justify the more the better or the everything for everybody approach, with the hopeful increase of ancillary income as a result. This illusion is the root cause of the "value to quality experience" dilemma and keeps the best, high valued guests from returning more often.
Value in the mind of today's family is more than just the lowest price. Even though many families tell you the opposite. They may be enticed and drawn out by the cheapest price, but at the end of the day their experience leaves them with an “empty hole” of mediocrity and questioning was it worth their time. The term guest sacrifice is all too common and a shared business strategy that no one wants to admit. Just look at the airline industry. If you justify your means to an end, because everyone else is operating the same way, do not boast to being the best, of the worst. Your only prize is to continue to be a disappointment, with an unfulfilled peak and end experience, that blends and equates to zero loyalty.
Today's family “value equation” is ...
Value can be elevated, by increasing the perceived benefit, functionally or emotionally, from the consumer's point of view. The other two options are to add more convenience or decrease the price. Too much focus on the “bottom line” (no pun intended) is the root cause of many poor experience driven businesses. An example is the current state of the fast food industry, which focuses on the cheapest price and speed of delivery, including a stopwatch at the drive through. Yet all but one, the one focusing on people first, are struggling to maintain their market share and fast casual, not the “fastest or cheapest” is kicking their butts. You know who that one is? I'll give you a hint they are closed on Sunday.
Here is the self-talk going on in the heads of your guest. Was it more than I expected or just average?" "Did you personally notice me and did you do more than just what I would expect during the transaction?" "Was it worth my time? "Did I feel connected, appreciated and cared for?" "Do I like you and are you like me?" “Have you done anything to get to know me?”
If you figure out how to offer a consistent, high quality personalized, emotionally connected guest experience cheaply, with high volume, then by all means you found the magic pill. Unfortunately it's a temporary pill with the worst times yet to come. Make your move to improve when times are good. Work on your business. Be the contrarian. Reinvent the way you do business. Invest in training, get a face-lift, and invest in new technology for the future. All of which contribute to a long-term healthy and sustainable business.