Growth Strategies

Does Your Business Need a Retrofit?

Markets always change, so reinvent to keep up with demand.
4 min read
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"Because things are the way they are, things will not stay the way they are." -- Bertolt Brecht

Reinvention is the key to customer service, and New York nightclubs are the quintessential example of an industry that keeps adapting to meet customer's changing desires, priorities and income levels.

In the 1970s, clubs were notoriously difficult to get into, like the fabled Studio 54. It was all about being accepted, hoping the haughty doorman decided you were attractive enough, well-dressed enough or had the right connections (or perhaps you were simply lucky enough to have him wave you in on a whim). Exclusivity was the name of the game.

The 1980s ushered in the mega-clubs, cavernous places that were much easier to get into because they needed to be filled. Drugs were plentiful and people vied to be more outrageous and "fabulous" than everyone else. But as the so-called club kids burned out and went into rehab, New York nightlife had to reinvent itself again.

Next, the casual and copious spending by the ever younger Wall Street set gave rise to smaller dance clubs where the cover charges went way beyond the reach of the masses. The more over-the-top the prices, the more popular the venue became.

Exclusivity based on how much expendable income you were willing to spend on alcohol was the sine qua non from the mid-'90s until 2008, when the bottom fell out of the financial world. The over-the-top era was over.

So what's a nightlife impresario to do? Change the focus of the experience again, of course. Enter Superdive, which has developed a downscale experience that works for today--from "keg service" with plastic cups to bathrooms with plywood stalls.

Club owners are always searching for a new formula, the next version of the New York nightlife experience. Terms like "club" and "bottle service" have been replaced with "gastro-lounge" and "table service." Cocktails that once cost $20 are now as low as $8. The new buzz word, "lounge," has taken on new meaning, as spaces with velvet-covered Victorian couches and red-draped lampshades become popular.

One formerly exclusive and pricey basement space has gone retro: Now it's a suburban basement rec room straight out of the '60s, with an old pinball machine, badly built bookshelves and an eclectic assortment of chairs and Barcaloungers. There's no door policy, and you don't need reservations.

"It is not the strongest of the species that survive, nor the most intelligent, but the one most responsive to change." -- Author unknown

It's not just nightclubs that are looking for new ways to entice customers. Savvy business owners who have a pulse on the changing moods of their customers are thriving, too. Those who continue to offer experiences that customers no longer find compelling will be are filing for bankruptcy.

As the New York nightclub examples above show, sometimes just changing the words used to describe the business (lounge vs. bar vs. club) or a service (table service vs. bottle service) is an excellent start.

It depends on the kind of business, of course, but taking a retro or downscale route can also be very effective, especially if your target market yearns for a simpler experience right now. Charging lower prices (wisely) wouldn't hurt, either: You're better off selling something for less than not selling anything at all.

And while the affluent will always feel more comfortable in an upscale space where they're offered good service and surrounded with people more or less like themselves, they do like to go "slumming" every once in a while-- although that experience can't be too earthy. An upscale version of a "slumming" experience for a sophisticated audience could be a huge hit if executed properly.

Sit down and think about whether reinventing the experience you are currently giving your customers would be appropriate and effective for the business you're in. Find a consultant who has expertise designing experiences to evaluate what you're doing right now and to suggest potential changes.

Small business owners who have worked long and hard to create their businesses and offer customers what they want are often the most resistant to change. But customers' needs are changing, and businesses have to change in order to survive.

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