I am a Yoga devotee, or more accurately, I was until a prolapsed disc meant “Downward Facing Dog’s” were replaced by MRI’s; my Yoga days were numbered unless I fancied risking the Surgeon’s knife.
However, a few months ago I rolled out my mat to try “Bikram Yoga” (aka Hot Yoga) after reading it could help serious back issues.
Although my personal fitness may not be of interest, the “business model” of Bikram should be; it makes for an interesting case study for the indoor play industry and anyone designing a scalable business model.
Yoga has been around for thousands of years, the UK market for “teachers / classes” is very fragmented and “studios” include gyms and school halls; although a large market, it was predominantly a “cottage industry,” a larger version of the indoor play market.
In contrast, Bikram Yoga is a multi-million dollar global business and it is interesting to reflect how this has been achieved, here is a brief summary:
- Bikram is an entire “business system” that delivers a consistent and reliable experience; it has been described as the McDonald’s of Yoga, in the context of scalability, this is a great compliment.
In contrast, most indoor play centres are not system based and the only Design that occurs involves the Soft Play Equipment. As a consequence, play centres are mostly operated by passionate and hard-working Entrepreneurs who work in the business, customers typically don’t see any difference between each centre and the perceived value is low. Simply, this has proven difficult to scale which in turn limits investment, recognition and innovation.
- The Bikram Yoga practice (a ninety minute series of postures and breathing practices done in the same order every time in a room heated to 110F) is designed to deliver exceptional health benefits in a safe and challenging manner; their marketing strategies encourage you to trial the service, they are so confident that once you try, enough people feel the benefit and want to continue
Imagine a play centre capable of improving the health and happiness of children and adults; how much would you pay to use it? We know that play is critically important to Child (and Adult) Wellbeing and yet I have never seen an Indoor Play Experience / System designed to achieve desirable and holistic outcomes for which Parents (or Government) will pay a premium.
- The “process” of Bikram Yoga has been patented, thus forming a “barrier to entry” and providing income from intellectual property in the form of Franchising, Books etc…
With many Towns having several play centres and Barriers to starting a play Centre relatively low, the market represents an open goal for Entrepreneurs able to develop valuable concepts and accompanying Business Models. Now is a great time to invest in unique (think protectable) Brands, Concepts, Systems, Technology and Relationships that provide compelling reasons to visit.
- Bikram has introduced Yoga to new markets
In the last six months, I have introduced Bikram to friends and friends of friends that would never have previously considered yoga, it has now replaced their gym schedule and they drive hours out of their way to attend.
Think, what new markets can you cater for in a unique way? Children with special needs? Children between 10 and 14 years old? Schools needing Play Space or classes? Children wanting to get fit? Child Wellbeing rather than just Play?
- Payment in advance means not only is each business cash rich but the pricing strategy is designed to motivate specific behaviour before credits expire. The expiration of credit is a little annoying but it means I go more often, increasing the likelihood that I will feel the benefits and continue attending
Ryanair, Easyjet, Health Clubs, Insurance, Amazon, Google et al…each demonstrates how we can use pricing strategies to create / manage demand, generate cash and establish alternative revenue streams. Think carefully about your pricing strategy; not solely in terms of how much you should charge but how you want it to influence behaviour and help achieve your business objectives
- Real estate is precious, “sweat the asset”
It is perhaps apt to talk of sweating the asset but each studio is located in expensive areas for real estate, there are black dots on the floor to indicate where you can place your mat, thus maximising revenue per square foot. I am not sure if soft play operators think about maximising revenue per sq/ft but this is a good reminder of how every inch of space matters, you are paying for it, after all.
Here are a few steps to consider when designing your business model:
1. Develop unique added-value concepts and experiences that deliver exceptional benefits (protect your ideas if possible / valuable enough)
2. Design a Business System (everything from the IT System to hosting a party) that delivers consistent results and an opportunity to scale (i.e. design one centre as though you are going to build a 1000)
3. Allocate at least 10% of your project value to design services; engage a design firm that is capable of exploring your entire concept and creating a business system rather than just “designing” your soft play equipment
4. Implement, test and share knowledge rapidly to increase sales, reduce costs and most importantly, keep customers happy.
Please let me know your thoughts or any stories in play where people are doing the above.
Follow us at Twitter.com/shareandcompare or (Un)subscribe to our Blog by e-mailing us
Posts
No comments:
Post a Comment