Strategy and Implementation Summary
The ArtSphere recognizes that the real product it sells is different from the art instruction given. Helena Rubenstein is quoted as saying, “in the factory we manufacture cosmetics, but the product we sell is called ‘hope.'”
This thinking holds true at the ArtSphere. The product sold is viewed differently by different buyers. A serious young student with potential may need special help in compiling his portfolio when applying to art school. A retired 70 year-old woman may be seeking a fun way to fill up an otherwise empty day. A stress-ridden executive may be seeking solace and relaxation. Encouragement, technical advice, stress-relief, escape from loneliness, self-expression, etc are just some of the products sold by the ArtSphere. The owners of the ArtSphere recognize that art lessons can be had at less than $5.00/hour in some state college evening courses. The ArtSphere cannot attempt to compete with these prices. It is only by tailoring the “real” product sought by customers that we will create and maintain a high level of sales.
5.1 Competitive Edge
There are many facets of the ArtSphere which make it a top-notch competitor in the art class business, a few are outlined below:
- All day multi-time slot schedule.
- Classes tailored to market segment.
- Two instructors.
- Dedicated instructional space
- Art supplies available on-site.
- Gallery venue for student artwork exhibits.
- High profile location.
5.2 Marketing Strategy
When comparing the market segment table below with ArtSphere’s available capacity, it is evident which direction the marketing thrust should take:
|Market Group||Time Slot||Capacity||
|School-Aged (Over 10 yrs.)||3:30 P.M. to 5:30 P.M.||1,666||
88 (11 hrs X 8 easels)
|9 A.M. to 3 P.M.||2,645||
240 (30 hrs X 8)
|Working/Evening Class||7 P.M. to 9 P.M.||12,042||
64 (8 hrs X 8)
The school-age market group with its potential market size of 1,666 has within the space of a couple months of operation taken up nearly all the limited 88 teaching hours of capacity for that time slot with some spill-over into the smaller evening class time period. This latter time period in the evening should be the easiest to fill considering its potential market of 12,042.
Clearly, the marketing strategy at ArtSphere needs to be concentrated on the biggest time slot, the 9 A.M. to 3 P.M. period. As of this writing, nearly all of the 8 easels are unoccupied Monday through Friday.
5.3 Sales Strategy
The ArtSphere has no sales force outside of its owners, Paul and Hannah, who will close the deals with interested customers created by actions of the marketing strategy. Many of the initial contacts will come via telephone inquiries responding to the offer of a free art lesson. Whoever takes the call should draw out the calling party and jot down a brief profile. Developing a sixth sense for the goals of the customer (stress relief, find new hobby, etc.) is key. If a customer is looking for stress-relief, then peaceful surroundings are essential. That potential customer should not be given his or her first free lesson during a crowded time slot, but rather when things at the studio are quiet and less active. Someone looking to escape boredom on the other hand should be scheduled when there are more people in the studio. A conscious decision also needs to be made concerning which teacher the caller is likely to relate to. If a caller does not come in for the offered free lesson, a follow-up call should be made by one of the owners. There is a direct relationship between the number of free lessons given and the number of people who will sign up.
Directly upon completion of the free lesson, an unabrasive effort should be made to effect a sign-up. If the person does not sign up, a follow-up call should be made. If Paul gave the free lesson, Hannah should make the follow-up call. It could be that the potential customer will respond better to the other teacher.
Walk-in inquiries should be handled in a similar fashion. Brochures containing particulars and an up-to-date price schedule should be available in a box by the door. Because of the studio’s high-profile location with large picture windows facing onto a busy pedestrian area, it is common for passers-by to look in. Good salesmanship will result is developing an ability to differentiate the interested from the merely curious. It is important not to be shy with interested parties. If the same person is noticed frequently looking in the window, or picks up a brochure and scans it, one of the owners must make a sales approach, even if it means opening the door and inviting the person in. Offer a cup of coffee, try to form a rough profile and offer to set up a time for a free lesson.
5.3.1 Sales Forecast
It is assumed that Hannah’s portrait contracts will continue at historical levels (1/month @ ave. price $650).
Sale of Paul Nash’s artwork will continue at historical levels ($3,600 annually, spread out evenly).
School-aged art lessons represent only 88 instruction hours/week taking up the 3:30 P.M. to 5:30 P.M. time slots each day (6:30 P.M. on Fridays). These slots are nearly all filled now. It is assumed that these hours will remain full throughout the year. Assume 75 of the possible 88 will be filled each week, four weeks/month at a sales price of $10/hour lesson.
The retired/non-work art classes will begin to grow after the planned renovations scheduled for January. Projections assume that price for four 90 minute instruction sessions will be $79. Sales to begin in March starting with the one fully booked 90-minute lesson daily Monday-Friday. These classes will have eight students each. A second daily class will be formed six months later, and after one year, there will be a third. This will bring this section of ArtSphere capacity up to 75% (four and one half of six hrs/day, or 180 instruction hours out of 240 possible). Assume each month to contain four weeks exactly.
This sector at the moment is practically nil. Growth depends on completion of modifications to premises, and success in ArtSphere’s marketing approach to this group.
|Year 1||Year 2||Year 3|
|Portrait Sales (HRN)||$7,800||$7,800||$7,800|
|Artwork Sales (PN)||$3,600||$3,600||$3,600|
|Sale of Art Supplies||$14,800||$37,080||$40,080|
|Direct Cost of Sales||Year 1||Year 2||Year 3|
|Portrait Sales (HRN)||$1,170||$1,170||$1,170|
|Artwork Sales (PN)||$540||$540||$540|
|Sale of Art Supplies||$10,360||$25,956||$28,056|
|Subtotal Direct Cost of Sales||$14,230||$27,666||$29,766|
5.3.2 Sales Programs
- Classes will be offered in many time slots throughout the day and evening, with instruction tailored to the customers.
- A wide variety of art supplies will be available for purchase by students during their classes, and by the general public.
- Hannah will continue her commission portrait work and exhibit in the gallery.
- Paul will continue to produce his artwork and exhibit and sell in the gallery.
- Weekend gallery exhibitions of owners’ and students’ work will encourage the sale of finished works and supplies and registration of new students.
We have set some milestones to help us focus on needed projects and to keep us on track to complete them.
|Milestone||Start Date||End Date||Budget||Manager||Department|
|New Flooring||9/1/1997||9/1/1997||$2,800||PN & HRN||N/A|
|Storage Racks for Canvases||4/1/1997||4/1/1997||$1,000||PN & HRN||N/A|
|Yellow Pages Ad||3/9/1997||3/9/1997||$65||PN & HRN||N/A|
|Seating for Seniors||4/1/1997||4/1/1997||$750||PN & HRN||N/A|
|Printing, L-head, Brochure||2/15/1997||2/15/1997||$800||PN & HRN||N/A|
|Brochure at Yankee D., etc.||4/1/1997||4/1/1997||$0||PN & HRN||N/A|
|Open House Plans||4/1/1997||4/1/1997||$0||PN & HRN||N/A|
|Ads Formulation (Spring Off)||4/15/1997||4/15/1997||$0||PN & HRN||N/A|
|Finished Ads (Two Types)||5/1/1997||5/1/1997||$0||PN & HRN||N/A|
|Finalize Spring Offensive||5/1/1997||5/1/1997||$0||PN & HRN||N/A|