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When more is not "More"

by Frank Price of FL Price and Birthday University

We are taught that “more” of anything, is better. In the world of commercial out of the home birthday party programs, this statement is counterintuitive. White Hutchinson's research and analysis is the triple-header of backup data to support this, as well as an indicator of future trends, in the out of the home party business.

It is clear that fewer children were born over the past ten years and it looks like this trend will continue. Although interestingly the population with a higher education is not following the same trend. They are continuing to have children, just later in life. Higher education has always had a direct impact on spendable income in the amusement industry, but now more than ever. It is also clear that the middle class is shrinking; overall, they are spending less out of the home, but spending more on in-home entertainment.

Party Program Significance

There is and will be a decrease in party demand because of fewer younger children being born and thus celebrating fewer birthdays. This population trend will create a moving gap in the numbers of families having a need for your party service, for at least the next ten years. There is also a spendable income shift as the middle class shrinks to the “have nots” and those with just enough to live their chosen way of life, spending is tightening, cost are increasing, yet they all still expect more. Those who are having kids and continuing to spend are becoming more sophisticated and desire new (for a while) or a better overall experience. Saturated markets or commoditized concepts continue to battle each other over a piece of a smaller pie.

Party Program Relevance

High-volume, everything for everybody outdated marketing tactics are stale, confusing and an operational nightmare. Volume concepts create the opposite of what the sophisticated market desires, burns out markets and will not satisfy their experience justification for... “Was it worth it?”

As you decide how to brand or rebrand your party business, take notice of this research. New businesses have one opportunity to differentiate and express a clear message of a unique brand, that's personalized and emotionally engaging, beyond tangible attractions. The first year and a half “home run” illusion that all is wonderful, will turn into a dogfight for business, as the next new facility opens with more, for less. If you survive that hit, the third year market burnout will get you. Existing party businesses past their honeymoon year are typically stale, outdated and now less relevant for the upcoming generation of young families. Only the bottom end (lower income, lower sophistication) of a shrinking market will opt in for an old, antiquated, chaotic, cheap birthday party for their child.

You are in control. You define who will choose you, by your offering and the price you charge. You are also in control of who you choose to compete with.

Let's say your market is like a gold fish bowl. The many gold fish are all the birthday party businesses in your market. You all look the same, swim the same and go after the same food. The food, which allows you to grow, prosper and survive are your potential party clients, but the food supply (the number of new babies) is shrinking. Only some of the gold fish (businesses) will survive. Usually the youngest (newest) because they are the strongest and can out last the tired and weak. But even those that do, at what cost? The bowl gets dirtier faster and requires more time, attention and labor to keep it up, not to mention having to deal with the fallout from all those deceased fish floating around you.

JUMP! It's a leap of faith to jump out of the familiar. You know you should, you can see in the distance there is a space less crowded. Everyone currently around you is frantically swimming in search of the same food. FEAR holds you back! “Go ahead leap” into the other bowl, where so few have ventured. As you start swimming, you'll enjoy the solitude, not to mention everyone is watching and talking about you. There isn't as much food, but that's OK. It is really good food and you're the only one eating. Take note, in order for you to continue to be fed, you must be worth the effort of the feeder. You must be better to swim there. Are you unique, special, and capable of doing tricks? Are people talking about how you are different? They'll call you the contrarian, the pioneer, the visionary or just Nuts. “Stay the course, It's more FUN.”

Field example

Which company has chosen a new space to swim in the fast food industry? In one bowl are all the burger chains, hoping to entice you with the lowest price, newest promotion or speed of delivery. But in the other bowl, there is a fast food offering that focuses on people first, not the "fastest or cheapest" and they're kicking butt. I'll give you a hint; they're closed on Sunday. Whether you agree with their beliefs or not, Chick-fil-A has changed the perception of fast food and become a new standard. They emerged as the leader and are the most profitable, in a crowded and commoditized, Industry. Their product is good, but that's not what makes them special. It's how you feel as you go through their fast food dining experience and pleasantly surprised when your expectations are exceeded. “Thank you” … “My Pleasure”

Innovators of any industry become the premier brand, with slower, but steady long-term growth and profit. Which bowl do you choose to swim? You are in control of your own destiny.

Party Marketing Strategy for 2020 and beyond

There are two brand-marketing strategies. Compete on price, (cheaper, average to lower quality, higher volume) or compete on experience (higher price and quality, lower volume). When you compete on price as your value, you attract a price driven, lower income, less educated consumer, who is always looking for, wanting more and choosing the best deal. They are not loyal and will search or wait for the next big discount deal. Margins are thinner, yet operational effort and the cost of doing business is higher. It's a burnout strategy that has worked for some, but now based on new family population trends it is an unhealthy and shortsighted way to hope for profitable growth.

On the other hand, if you choose to compete on experience as your value, you eliminate over eighty percent of your competition. You become the opposite of high volume, low quality and cheap price and thus have to behave accordingly. As you redefine the value term, you will attract a more sophisticated client, replacing the less loyal, resource-draining portion of the market. To achieve this, you must deliver a high-level, consistent end result.

Good enough is no longer good enough to satisfy today's sophisticated family market for commercial birthday party programs. The consumer that continues to have disposable income and spend it on out-of-home entertainment is only the top 20% of household income earners. They tend to be more educated (still having babies) and complex, with a buying emphasis determined by their perception of value.

A more sophisticated consumer does not measure value by how much it costs. Value is elevated, by increasing the ambience and perceived benefit, (both functionally / emotionally) from the consumer's point of view. “Was it more than I expected, or just average?" "Did you personally engage me, or did you just fill the transaction check boxes?" "Have you done anything to get to know me?" "Was it worth my time? "Did I feel emotionally connected, appreciated?" “Did you surprise me with greater meaning, family connection or personalized interaction? “Do I have a story to tell?” "Do I like you and are you like me?"

Party Program Value

Value in 2020 cannot be seen or touched but is a measurement of the experience and was it worth it.

Tangible Party Value (expected and hopeful)

• Attraction type and variety.
• Ambiance or theme, expected positive sensory impressions, including your employee's appearance.
• Festive / functional party rooms
• Safety, cleanliness, freshness perception
• Party packages with “stuff”

Intangible Party Value (Unexpected and delighted)

• Party host stays with party entire time that facilitates the personalized fun value, from start to finish
• Party child set up as the center of attention, feels special, Create VIP (birthday child) envy
• Adding back the “TLC” (tender loving care) to the party
• Engaging with personal and emotional interactions
• Mom feels back in control, even though she did not have to do any of the work.
• Create memorable peak and end experiences that are story and picture worthy
• Mom/Dad feel appreciated. All their perceived needs are met
• Unexpected pleasant surprises along the way.

Eliminate Frustration - Limit the number in attendance

• Able to control the overall experience for a consistent result
• Ability to personalize the experience for the birthday child
• Eliminate negative emotion, chaos, down time, forced parental involvement

Party business solutions for 2020 and beyond:

Remember marketing 101? The top three ways to grow your business, with the least amount of investment, yet the greatest yield on return is as follows: prioritized in order.

• #1 - Keep your guests
• #2 - Get your guests to return more often
• #3 - Get your guests to spend more while they are there

Number one:

Guest retention is the most effective and cost-efficient way to increase your business. If you increase the percentage of guests you retain, even by a small percentage, your business grows substantially. Loyalty is directly linked to the consistent quality of the guest's party experience and how emotionally connected they felt. Disloyal guests are always looking for the next new thing, are price-centric, hard on your business resources and have more negative than positive impact on spreading the good word of your brand.

Keep Your Guests by Doing Great Parties.

Right-sizing. Pay attention to the details. Surround the birthday child with special attention and show them you care. Facilitate and connect the emotions of the day. Communicate often to make them feel appreciated, informed and that they belong. Justify value and deliver what you promise.

Now that you have chosen to raise the bar of your party program and become the unique, high quality and emotionally engaged party experience, analyze your competition. Not to compare, price / packages and react, but to learn what they do bad and then do the opposite. Understanding their common mistakes that make up the root cause of frustration, gives you self-assurance and a unique story when you choose to be the opposite. You can say with confidence, “We are the best party in town, where our hosts stay with the party the entire time and it's their passion to ensure your party child feels special and the center of attention.” This differentiates, keeps them coming back and telling your story of how you really are the best.

Number two:

Programming is the long-term solution to a profitable amusement business. Giving a reason to get your guests to return more often is the next most effective method of growing your business. Understand and meet the market's needs by offering a variety of ongoing programs gives them a reason to return and not explore offers.

Here is an example of programming a new party offering, that when done right and meets their specific age needs, creates a reason to return. A Teen (12yrs - 18yrs old) Party on Friday and Saturday evenings is a solution to party program growth in a shrinking younger market. This party has fewer guests and is unstructured. It's the only style of party where unlimited attractions works. Set up a VIP room with a “club like” atmosphere, with lighting, relevant music and app games. Place a large team member in a tuxedo T-Shirt as the doorman that allows only guests to have VIP room access. Oh, by the way the key to making this party successful … “No parents allowed!”

Number three:

Get your guests to spend more while they are there. Make sure you take advantage of adult guests staying on site, offering food & beverage (beer/wine) options that meet their needs. Their perception of ambiance, atmosphere, level of comfort and your team's interaction, all contribute to length of stay and how much guests will spend while there. Make it easy for them to order by sending a server into the party room (with party Moms permission) to take food and beverage orders, then deliver it to where they are comfortable eating and socializing. Craft beer, wine, mimosas along with tasty sharable food items will be your best sellers.

Finally, Get Control of your Numbers

Control the number of parties, the number of kids in the party and your party program profit. Price, package and schedule your parties with an end goal of a consistent, duplicable experience. Optimize the party experience with the majority of your parties at the ideal party size, 10-12 kids. Price to control the number of large parties and offer them at non-busy times (first and last party of the day). You can no longer measure success or growth of your program on volume or the number of parties you have done. Update your accounting practices to get a monthly report of net program profit. Incorporate the expenses you wish to include. It must be consistent from month to month / year-to-year, so it can be used as a comparable to give you an accurate, plus or minus party program growth measure.

So, if any of the following sound familiar, you will continue your swim for less available food and newer, bigger and more fish, all-fighting to survive.

• If you are still one of the cheapest parties in town
• If you measure your program's success or growth by the number of parties, you did.
• If you still have multiple, large party offerings.
• If you are doing more than a handful of 15 plus kids in a party per week
• If the term value means a dollar amount to you.
• If you do not have a host stay with the party the entire time
• If the party group does not stay together
• If you expect or let party moms do any of the work
• If you do not have an online booking system.
• If you believe more time or stuff in the party package justifies value.
• If you rely on your attractions as the long-term reason for someone to choose your party
• If you think you can treat your employees like you did five years ago.

Contact frank@fl-price.com and send this message “Send me the “Party Overview - 2020 & Beyond.” and receive a summary of what's necessary to achieve long term growth and profitability in the years to come. www.birthdayuniversity.com (919) 387-1966

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