We all should respect, but not fear, competition.
- Don and Dolly Dixon
Each of us should work on eliminating our weaknesses and capitalizing on our competitor's weaknesses. Likewise, we guard against and monitor potential threats to our business, and hope that our competition overlooks us as a threat to theirs. Sometimes you may find it best to identify your competitor's strengths and not try to compete with them in that area. eg; Retail foils at 69 cents. You can't win that fight! So don't even try. Take them on where they can't win a fight with you! Analyze BOTH your business and theirs. It shouldn't take you any more than 1.5 hrs to do your biz and your 2 most formidable competitors. You'll then find it easier to identify and focus on your "edge".
Maybe you'll find your "edge" listed under Strengths? Maybe under Opportunities. eg; a recent topic on this list was the potential for linen rentals for some balloon pros? This market has huge potential for willing entrepreneurs. Does Party City offer linen rental?
An "opportunity" may be in relocating to where the proposed new freeway will give your business 10 times more exposure? ...or half the rent with more floor space? Your "strengths" may be your creativity, telephone manner, patience with brides, rapport with local hotel banquet managers, using Qualatex balloons, your portfolio, etc.?
Just remember that half the battle is being honest enough to admit your business "weaknesses." Could be a staff member's personal hygiene or appearance? Bookkeeping? Estimating? Floor space? Customer Parking? Home based - so no visual displays or client meetings at your premises? Lack of signage? Low on capital? Uncooperative / inflexible / unreliable suppliers? Computer skills?
Basically, analyzing strengths and weaknesses is about looking at a business as it is NOW. Analyzing opportunities and threats, is looking into a business's possible FUTURE. I hope this helps some look at their business in a whole new light and inspires the doubtful to surge ahead. Don't be afraid of competition; use them - out smart them - respect them and accept them. Try this new attitude and soon you'll find that they are doing their best, just to compete with you!
My husband bought me a balloon and they claim that their balloons are 12". This girl must have been so scared of the balloon popping because this balloon might have been 10"... drastically underinflated. feel Party City is far from what I expected!
It's a tough row to hoe, but I'll get there. Word of mouth about my "long-lasting," beautiful balloons delivered with a presentation is (slowly) spreading. You and I both know that no dollar store or Party City can compete with that.
You will lose some potential customers to Party City, as there are always people who buy purely on price alone. But I believe balloon professionals must increasingly look up towards the high/quality end of the market, rather than trying to compete in the mass market, where price is king.
The one thing that makes my service different is that I am a "Decorator" these places are just selling balloons and other items. I can solely concentrate on party events when they cannot. I take the time to explain and show in detail my work and what I can do for them. I show them the balloon color chart so they can see how the balloons actually look and inflate them if need to. When someone calls with questions on a decorating Seville I accommodate them, by either having them come to my home or by me going to theirs. Since the majority are working people they love the idea that they can shop in the comfort of their home.
As for Party City and everybody else, they may sell their brand name cheaper but my balloons are quality and I state that to the customers. I do sell a dozen balloons at Party City's price but for that price I purchase the bargain city balloons that Flowers, Inc sells $6.65 for a gross of 11" assorted colors. This way not only can I sell at their price but then I get the opportunity to educate the customer by letting them know that these balloons are the same as the other stores. If they want quality balloons they are more expensive. And of course, here comes the questions from the customers as to what do I mean inexpensive and what are the difference in balloons and so on. So, I have to say that although I have all of these stores surrounding me, I still get calls. Not to mention that especially when it's a balloon delivery I always add either a geo, or other colorful balloons so they think that I am being generous and that they are receiving something different.
What I'm trying to say is that if you are selling quality and satisfaction to the customers they will always recommend you to others and they will come back.
Remember this as well. When a person buys a balloon on a string from a party store, they get a balloon on a string. They don't get an arch. They don't get a romantic setting for a wedding reception. And, if they're lucky, they may get an employee who won't have to remove him/herself from the customer in order to ring-up a customer buying a $2.00 b-day card, and then try to finish the original customer's arrangement.
When a customer goes to Party City, they get a balloon on a string. When they come to a CBA, or other artist, they get MAGICAL MEMORIES. What is that worth to your customer?
I started using the Marketing Material that Qualatex sends me and believe me it works! Party City's workmen's comp does not allow them to use High Float. And Party City closes at 6 PM on Sunday.
When I go to Party City (because they sell rolls of ribbon for .79-.99 when on sale) I always take my business cards with me. I've assisted customers too (as I hand them my business card).
Yours is similar to a competitive situation in my own experience. All the major chain craft stores do picture framing. Samples of all the different kinds of matting are on the counter and lots of generic examples are on the surrounding walls in this part of the store. They frequently run 50%-off custom framing coupons. I've tried to ask for advice from the clerks, but they clearly only know how to cut and paste. I go there when I have a simple job, don't want to invest much and know exactly what I want.
I also know of a small frame shop. They too have samples of frames and mats. On the walls are all the prize-winning framing jobs they have entered in various contests. They advise on colors, proportions, etc., and help match to not only the piece being framed, but the furniture/room it will be in or near. When I don't know exactly what I want and/or I want a top quality job, I trust their advice and have never been disappointed.
When I am at someone's home or office, I can tell if their diploma, or whatever was professionally framed or taken to the chain store. It's usually not something you can put your finger on, but something just isn't quite right.
I'm guessing your party superstore has a book on the counter with the menu of columns, arches, etc. with a component price and maybe some package deals. I pick the pieces I think will look good, change the colors, and that's it.
I know I can't envision the overall effect you can give me, much less design or do it myself.
YOU can offer service, a cohesive decor package. Help me develop or exploit a theme. Talk w/ me about my menu, guests etc., things the party store won't show any interest in. Personalize it for me. Show attention to detail. Make me think you are tailoring a whole package especially for my party. It's custom made for me -- I won't be able to resist.
The advantage is if everybody starts having balloons from this store, all the parties/events start to look the same. (The best part is everybody starts having balloons!) Then as the savvy hostess I have to look for that something different. Along with that is what we call snob-appeal. My event was too good for the standard decor package from the party store. I hired a professional! And it'll be the talk of the town!
Start by giving the public (your customers) a little respect for their level of intelligence. They have eyes! They can SEE the difference between a great balloon and a "weekend warrior's" supermarket quality latex balloons. They can see how a pro decorator presents herself and her business. They can HEAR how she talks to them with genuine interest on the phone. None of us have anything to fear from backyard balloonies. They are, in fact, your best justification to put your prices UP. The wider the gap, the more the buyer will question the quality of goods offered at the lowest price. She'll investigate.... and find the true value is with the stable business operator with the known reputation.
So the "El Cheapo" - fast buck - do it on a shoe string budget - operators... and the type of customers they attract... are doing you a favor. And we all know what happens to them after a few months or a year. They go bust and end up in some other scam or quick buck biz. Their customers find their way to your door pleading for a discount. Right? (and let me be the first in line to kick you in the tail if you give it to them).
What about the ones who do become professional in their approach? What about THIS new competition? Well, they are smart enough to realize that to make a good living from balloons, you gotta sell at the RIGHT PRICE. They also know that they have to have a "point of difference" to their competitors. The more variety and uses people see for balloons... the more often they will shop for balloons. If you have the confidence in your knowledge, your skills and your products... your bank manager loves you. Don't fear your fellow professional balloon decorators. Embrace them and team up with them to make a full frontal assault on the market. If you aren't active in a QBN Chapter, look into it!
Finally, there was another comment of concern about the balloon profession ending up like the cleaning profession? Again, think about this in the context of business viability and opportunity, rather than "the lowest price wins." Society is changing! We are now forced to have 2 bread winners in most families. Many of us don't have time to do the gardening, mow the lawn, clean the house, cook the evening meals, wash the car... do the balloons for Gloria's wedding. The change in society itself is virtually guaranteeing the growth in domestic and commercial service industries. There are lousy gardeners, terrible restaurants and short-cut cleaners out there. Still - only the good ones in their field will go on to make a comfortable living from a sound base of customers that TRUST the business owner, year after year after year... You have better things to do. And by doing those "better things" you bring about the doom of the fast buck characters.
I suggested we should all emphasize the specialty balloons in our displays and deliveries. It is changing out there, because the mass market outlets are offering packaged balloons in the grocery isles and at the gas station. Mylar balloons in corrals above the grocery isles. Many in Australia see this as a threat. I assume it's the same everywhere? But what one man sees as a threat to his business, another sees as an opportunity. I am guilty of being the eternal optimist in business. (the glass is always half full and never half empty)
By having the supermarkets stocking 9" or 11" round balloons, all I need to do is FEATURE my "point of difference". So, I show GEO Donuts, Blossoms, 260s, 350s, heart shapes, SDS, Bat Mitzvah prints, and more. Human nature is such that the middle and upper class shopper will seek out something different... something unique... something personalized... something that her friends and relatives have not seen in the supermarket isles. She can afford to! So, guess what? That category (demographic) of shopper is just the one that I wish to target. Why? Because price is secondary to her! What she is looking to buy is something different. She will pay what she believes to be a "fair price" rather than a "cheap price" simply because she sees what you are providing her, is a "one off" - and not what her guests will see as Ho Hum. She will impress them!
Think positive! This is an advantage, an opportunity. At last you can focus your attention on your real point of difference. You don't sell balloons. You sell quality. You sell a huge range. You sell emotion. You sell creativity. You sell decor. You sell customized product and service. You sell "designer" balloons. You sell what is not available on the supermarket shelf. You wrap it or deliver it differently to everyone else in town. Your staff are friendlier and full of expert product knowledge. You sell big ticket items - Not price sensitive packet balloons.
Our policy (and we tell the balloon reps this very clearly) is that if we see it in a supermarket or at the gas station, it is removed from our shelves! It is a waste of time trying to compete with mass merchandise outlets. Don't give your customers the chance to compare your prices! If they stock apples, you had better stock bananas. If they stock both, you stock bags of mixed fruit. Bags of mixed fruit may have less market appeal, but you can command a better price for what is unique to your business. It's the profit you enjoy on each sale, not the total number of sales, that is important.
You don't really need to be concerned about the mass merchandisers if you identify AND MARKET your "point of difference". For an interesting article on this topic, see Images magazine's profile on The Red Balloon Co. in Seattle. RBC decided years ago to do all delivery bouquets in 16" latex. I bet they charged more than their competitors did for 11" arrangements! They became famous for their "point of difference". Linda Bruce became known in her town for her "signature bouquet" using GEO Blossoms and 260s combined with round latex. Bruce Walden has quite a unique "point of difference". His is - innovation. He is renowned the world over for being at the cutting edge of their industry. What I'm saying is that there is a bit of Jim Parker, Linda Bruce or Bruce Walden in each of us, if we just look for that quality or idea within. What's your point of difference?
Now, who cares about balloons in drug stores?
I believe what happened is this: People who never considered buying flowers from a florist shop, carried home flowers and grew accustomed to having them around. These people then thought of flowers as a "neat thing" and realized that they could send them to friends for important occasions. Very few people would send the wad of flowers from the supermarket for a special occasion and so they sought out a florist for that special day. Viola!, a whole new market.
Yes Virginia, supermarkets have ATM machines, some even have mini-banks. However, believe me when I say, "The banks are not going out of business"!
On the other hand, supermarkets were devastating to mom and pop grocery stores, who tried to compete with their prices.
So, set yourself apart from the supermarket. Do better work (you can charge for it, it's all right). Do different work (you are trained, their help is on the revolving door plan). Offer the one thing the supermarket does not; SERVICE. Find a niche and fill it! Most supermarkets do not decorate, can you imagine going to a big formal dinner dance and Mrs. Gotrocks telling you how she bought the upscale decor at the SUPERMARKET, with her weeks supply of toilet paper?
Remember, the mom and pop grocery stores are gone. Seven-Eleven walked in, filled the void and offered service. They are open the hours people want. The offer the small, in and out store. They charge a premium for it and they are doing rather well. They still sell the same thing, food, however they package it a little differently.
The thing that will hurt your business the most is a bad attitude. Consider the supermarkets as training for your customers. It teaches them just how wonderful balloons are. It makes them AWARE. This is a good thing. Now, you work on tracking down the customers who want something special, a wonderful delivery, an exciting sculpture, a dynamite trade show booth, a beautiful wedding, professional decor.
Remember, the supermarket sells food. But there are probably a FEW restaurants in your town still selling food also.