SWPP Convention 2010 Day 2 – Business School – Part 5

Taking the reins for the penultimate seminar of the business school was Barrett & Coe Franchisee of the Year 2007, Suzanne Stinton-Heeley.

Having worked a similar business model to Suzanne, this did provoke a little more interest to me than some of the other speakers. Obviously if you are to take anything away from these seminars it’s that these are just people’s options, and just like this post, they’re not to be taken as gospel.

Personally I have never been a big fan of the Barrett & Coe business model or the idea that somehow you could secure your area for £1000. Undoubtedly franchisees have had significant success (in a booming economy). My concern is whether a business model, which is based around a high volume of new clients, is one that can be sustained. Venture, the pioneers of this model, first brought brought this idea to the high street over ten years ago. Unfortunately aggressive data collection coupled with cheap entry point/high end price has become highly recognisable to our consumers. This has led to a more weary client. Suzanne herself stated “We don’t get the same data collection numbers we did two years ago”. It’s far too easy to blame the economy when you have a luxury or lifestyle product.

During the height of the recession (Nov ’08) I was managing two family portrait studios. These weren’t new, in fact one was over five years old. They had a steady (and loyal) client base which used the front of house printing services. The problem was that previous management were not taking advantage of customer loyalty, in fact they seemed to be apologising for having to charge them for their photography. I say this only in regards to the prices they were charging! I made the changes needed and took profits up to over 1000% on the previous year. I also made a (studio) record sale from a regular client who’d been having yearly portraits at the studio. My sale, compared to the year before, was nearly four times the size. Has she returned this year? I would imagine she has, but as I no longer work there, I can’t be sure.

My point is that you can make money in any financial climate if you build a loyal client base.

How do you know you’re doing this? Quite simply look at two things:

1. Your referral rate -What percentage of your clients in the past year have come from referrals?
2. What percentage of your clients this year are previous clients?

If you add these percentages up and the number is less than 50% then you’re in real trouble. Why? Because you’re spending too much money creating new clients when the best adversing can be done for free using your existing ones. At the end of the day it comes down to a numbers game. How much more expensive is it for YOU to create a new client compared to introducing systems which will increase your referral rate and return customer rate?

One thing I did take from the seminar, which incidentally was it’s title, was the importance of doing a marketing audit. Suzanne has done a wonderful job of putting together some key points you should be looking at to give you a better understanding of your business. I have taken that audit and added a few things of my own. I have put this together in a PDF for you to download and print. It’s very much a work in progress and if I’m honest I wrote most of it on my iPhone whilst sitting on the District line.

Download Business Audit Jan 2010

If you want to fill out the audit and email it back to us to assess we’ll do this free of charge. We’ll put a Word version in the downloads section to make thing easier. Just send in your finding to info@photocreative365.com. Don’t worry if you can’t fill out all of the sections.