YOU AREN'T LIKELY TO hit a target if you don't take aim at it first. This is true for marketing efforts, too. Your party rental business is far more likely to be profitable if you define who your customer is, then deliver exactly what that customer needs.
PICK AND CHOOSE
Al Briggs, owner of Briggs Tent & Party Rental, has a clear definition of his market: “It's the two-hour driving radius of Eau Claire,” Wis., where the operation is based. His customers include homeowners, businesses and civic organizations.
“We're in the rural west end of Wisconsin, where there isn't a big population,” Briggs notes, “so we have to spread out.” Besides being willing to put in driving time, Briggs Tent isn't too big for smaller jobs. “There's no such thing as too little,” Briggs notes.
On the other hand, saying no to some clients can be the best way to say yes to profitability.
Steering away from homeowners in favor of bigger commercial clients and requiring a $2,500 minimum during the busy summer months are two ways that Livermore, Calif.-based Special Events avoids “trying to be all things to all people,” notes owner Bruce Monaco.
“We zeroed in on the business we feel gives us a higher level of profitability,” he explains. “We've done it because we only have so many resources — trucks, drivers, equipment — available on a given weekend, so we try to maximize it to our advantage.”
Monaco is always evaluating where profitable business will be. “We are constantly looking at our market and developing those areas that we feel will yield a higher return for us,” he says. “We constantly evaluate our customer base to ensure that business we have been doing for, let's say, the last five years still fits our objectives.”
The rental market in his area has undergone big changes in the last decade, according to Damon Holditch, CSEP, president of Austin RentAll Party in Austin, Texas.
“In the early 1990s, the market was wedding and social; the business segment was small,” he explains. “As the computer companies grew, the business events grew. The last half of the 1990s saw a rapid increase in business events. Businesses were using events to celebrate business milestones and do product rollouts. The year 2001 saw the reduction in business events in the Austin market, [but] weddings and social events continued to grow.”
To serve this changing marketplace, Austin RentAll Party takes its cues from its clients. “Our inventory and services are entirely driven by our clients,” Holditch says. “We bring into stock what our clients request. If it is a trend, we work the cost over several rentals. If it is a fad, the client pays the entire cost on the first usage.”
Studying where the market is going next is a shared task at Bravo Location Rentals, headquartered near Montreal.
“Our marketing starts from both ends,” explains president Andrew Paquette, CERP. “The sales team watches for niches that can be targeted, while management develops overall campaign structure.”
Paquette views his competitors as more an asset than a threat in the marketplace.
“Each rental company has its own forte,” he explains. “We never solicit a client away from a competitor based on price. Consumerism teaches us that customers understand that they truly can only have any two of the following — perfect quality products, exceptional service or best price — or the provider goes broke. As a business we want to try to keep all three as high as possible. But each business is different, and that's based on how they prioritize the mix of these three.”
COMPETITORS AS CLIENTS
Parties and More, based in Bensalem, Pa., just outside of Philadelphia, has identified an unorthodox target market: its competitors. “This year and last we did a heavy emphasis on marketing ourselves to other rental companies,” explains sales and marketing manager Larry Ott. “They aren't the enemy; we partner with everybody.”
Parties and More has carved out a niche by building such a deep inventory that other rental companies come running to sub-rent. “We have 40,00 chairs,” Ott notes. “We will do 12 to 15 graduation ceremonies this year, but we will deliver only two of them; the other jobs are being picked up by other rental companies. We make it very simple for them, and year after year, they come back to us. If it means getting inventory, we don't shy away from it. We embrace it and move forward.”
Ott believes that the best way to serve changing markets is to remain flexible. “We define ourselves by not defining ourselves. The only ones who will survive in this economy are those who will adapt.”
RESOURCES: Austin RentAll Party, 512/491-7368; Bravo Location Rentals, 514/685-8000; Briggs Tent & Party Rental, 715/839-0218; Parties and More, 215/245-6000; Special Events, 510/353-7400
ZEROING IN ON YOUR MARKET
These questions can help you focus on your target market and how best to serve it:
- Does management have a mission statement defining your target market?
- Does the sales team understand and support the mission statement?
- What key products and services do your target clients need? Can you start offering these products and services?
- How is the business of your target clients changing?
- What can your business do to serve your target clients better?
- Are new client segments emerging?