I tried to turn an 800 acre piece of dirt into a marketing company. It mostly succeeded until it ultimately failed. Here are the thoughts behind the process - and why I felt like it needed to be done.
Our story starts with me having $8 and a half a potato (if you've not read that, it's a few pages back) and then I was hired to be the Director of Marketing and Director of Entertainment for a large entertainment venue.
I was the only employee and the only one in the office (there was another girl that would come in once every 2 weeks and act as operations manager, but for almost two months, before I hired a full time guy, me and the owner was all there were - and he had a real business that he needed to concentrate on).
This venue is huge - almost 2 miles front to back and a mile side to side, it could, and did, fit thousands of people in there.
It was only open on the weekend every few weeks and so.
The park itself could only make money on those weekends they were open and that was a definite problem. But there were a couple other problems as well.
1. It's expensive to open the place for an event. Six figure expensive.
It's funny in a not so funny kind of way that everyone believed 'if you build it they will come, and it's really inexpensive to build'.
Oh but wait.
By the time the owner opened the park 3 years prior, he had spent close to $1 million invested into it. That might be small potatoes to some, but that's a lot of them. (coincidentally the park was located on a working potato farm)
Each time the park opened we could be expected to pay out up to and sometimes over $100,000 - that's before one ticket was sold or one person came through the gate.
Security, electricity, entertainment, etc etc. Porta Potty's costs a fortune and they stay out on the property year round to actually save money.
Opening is a huge financial risk each and every time.
Can you get enough people? Will the weather keep people away? What else are we competing against?
But that wasn't the only risk.
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2. Everyone that came in had to sign a waiver saying that if they were injured or worse, killed, that we weren't held responsible. Yikes.
Liability insurance was expensive - and Lloyd's of London was the only place to get the kind of coverage we needed. Think about that. The same people that insure celebrities on film sets and athletes on the field is the same place we had to get our special insurance.
The reason we had everyone sign the waiver was because our sport is one of personal responsibility.
To say that another way, we're not responsible if you do something stupid and get injured.
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I was brand new to the business and hadn't even hosted my first event, but when I looked at these issues; can only make money when you're open, expensive to open and operate, and combined those with the risk involved for bodily harm, I thought we needed a new path moving forward.
What would that plan be?
All of our revenues came from selling tickets to an event. Butts in the seats as they say. Where else can you find revenue - more revenue, and replace the money you have coming in?
My thought was this: Turn into a marketing company.
But first, I needed to sell tickets and needed to find a way to do that.
Turns out, I devised a way that I could do one while working on the other.
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1. I was going to grow our online presence to massive proportions.
We had a solid demographic in a niche but very popular sport. Other's had led the way and we could piggy back a little on their success before outright taking them over and leading the way.
Our 20,000 fans, after being online for a number of years, seemed extremely small. We simply needed to grow that base, and fast. (I only had 2 months to market my first event and it was coming faster than I had time to think)
I implemented a marketing plan that was very aggressive at growing our user base using some of my own personal marketing techniques.
I reallocated all my media buys and focused online like a laser. We were doing TV and radio and magazines and I took a little money from each because we needed it spent in the right places for our moment in time.
Within weeks the statistics started to show positive.
Within a month, it started to snowball.
Within 2 months, right before my first event, it was a juggernaut.
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2. I was going to re-do our website from the ground up.
When I arrived I had to ask our web guy to update the website for us. Which meant a phone call, followed by an email, followed by waiting a few days, another phone call, another email ...
You get the idea.
I didn't have time for this.
And then something happened. I broke the internet.
Our event was getting closer, our online fan base was growing fast and I was sending so much traffic to our website it crashed. Gone. Offline.
Now I really didn't have time to wait on someone else - and especially someone I could hardly ever get in touch with. I had to move.
So, knowing how to build websites and having built plenty in years passed, I decided to take on building ours from the ground up.
But what good would a large online presence and new website be if we didn't bring in new forms of revenue. And so I started looking forward and thinking about the future as a marketing company. But not too far, I hadn't had my first event yet.
Even still, I built our new website in a way that could provide revenue. I was planning ahead for a sales guy.
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3. We were going to limit the number of events we have.
I had read all the reports. Gone through all the numbers. I knew, even though I'd not yet had my first event, that when a place like this limits its events, they make more money.
The fact is, being open so much, in our business, was killing the profit the business might get from being open. There was a weird inverse relationship there but I understood it because I ran the numbers.
If we had 10 events we would make x. If we had 12, x. If we had 9, x.
9 events made almost as much revenue as 12, but a lot more profit.
My argument was to drop to 6 events a year.
The reasoning was simple - the lower the events the more exclusive. With less events there's more opportunity for people to come out (our customers would break their toys out there and wouldn't have them fixed by the time the next event would come around, so they'd stay home, skip a few, come back - with this pattern you see a clear path to naturally select what events you should do and how you should spread them out).
We could make more profit on fewer events and that's what we needed to do.
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4. We were going to raise prices.
When I first started, the ticket price to get in was $35 for the entire weekend.
Nightly concert entertainment, camping, races, other activities - ridiculously low price for a weekend like that. Especially given the operating cost and liability involved.
It was too late to raise the price for my first event, but after seeing my first, I knew that ticket price needed to triple. $100 would be a fair price. Here's a few reasons why:
The place was crowded. How crowded?
Try this (and it had never been like this for this long a time) - 3 lanes coming in, 4 miles long down the road, and a 17 hour wait.
People had never seen anything like it - and I'm talking about people who had been there at many, many events. Everyone was blown away by how many people showed up.
People came from Michigan, Ohio, New York, Canada - all over the country. Some from other parts of the world.
It was a blow out.
But by blowing it out, we also had to deal with a some really pissed off people.
Our customers who were stuck trying to get in for hours upon hours, they weren't happy.
And the County our business is in? They were just about livid.
Our backed up traffic blocked a bus full of school children on their way home. Ouch.
Raising the price of admission had to happen. It would cut down on the crowd a little for one, but for two, we'd make a lot more money.
Double the price and lose 50% of your customers and you're even revenue wise to where you are now - but the park will be less crowded and the lines coming in won't be so bad.
But I knew, because of how I was growing the business, we weren't going to lose 50% of our customers. They would just be replaced by new customers. At most, we'd lose 10-15%. At most.
That would leave us making a lot more profit and would start to turn the ship around.
And we needed to turn the ship around and make some capital improvements - most especially add more lanes coming in. Get us out of the way of the children, their upset parents, and the county scrutiny.
And work on the next phase of my plan.
(part 2 coming soon - it's good so stay tuned)
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