Ever hear of the 80-20 rule? You know, the concept is that 20% of the people perform 80% of the work. Or, for pro shops, 20% of the customers account for 80% of your revenues. Whether the 80-20 rule was ever true, I don't know. But I do know that most industry leaders are informally changing it the 85-15 rule.
One major example is that among all the tennis players in the United States, only approximately 15% join the USTA. From this knowledge we might reasonably expect about 15% of the people who play at our facilities to be interested in serious competitive opportunities. Another example, in several teaching pro organizations that I surveyed, is that about 15% of the membership attend conventions and participate in continuing education programs. And, in my own business, Oncourt Offcourt, about 15% of our database are seriously active customers. It probably holds true for you as well.
For the purpose of this article, let's identify five important jobs and how we can better serve the top 15%, the core of our businesses:
JOB #1 - What is job no. 1 in running your business? Most of us would probably answer pro shop sales, or member services. But, think about it. Isn't our first job in the tennis industry to collect information, to add names and contact information to our database? Only then can we begin to tap into our potential to generate sales and service our customers. To accomplish this task effectively, develop several different tools so that every single person who uses your facility or visits your shop has the opportunity to get on your mailing list. Put notices on the counters, even in the bathrooms. And, most certainly, make sure your sales or counter staff diligently update records, including E-mail addresses on a daily basis.
JOB #2 - Now that you have developed a solid database, it's time to start mining. However, don't just do what most businesses do, namely to repeatedly mail to their whole lists. Sure, you must service your whole customer base, particularly if they are paying members at a club. But, more important is to stay in frequent contact with your best customers, your top 15%. They are the ones who will participate in social events, spend more money in the pro shop, and also take more lessons than the other 85% combined. In your database, establish codes so that people can be filtered with specific interests and levels of participation.
JOB #3 - Don't just mail, E-mail! We hear it over and over again, yet statistically I would venture to say that only 15% of the pro shops and tennis clubs in the U.S. are beginning to use group E-mail lists effectively. Part of JOB #1 is to actively acquire the E-mail addresses of your customers. The next step is to group them according to interests and buying habits. Examples include creating separate lists for players who actively participate in leagues, social events, competitive tournaments, lessons and clinics, parents with children who enroll in junior camps, and those who purchase more than four times a year in your pro shop, etc. Contacting specific groups can have many benefits. First, it can help you make your best customers feel special, for example giving them advance notice of activities with limited enrollment. Second, it can help you focus your efforts and isolate exactly what sort of participation levels to expect with various activities or in levels of product sales. Again, this practice will help you pay extra attention and service the top 15%.
JOB #4 - Our fourth tip to emphasize is networking. For pro shop owners, try group buying with other shops in your area for high-volume discounts. For tennis directors, invite other pros to your club or facility for regular exhibitions and mixers (and pay them for their time!). For facility maintenance managers, network with other clubs to buy court equipment in higher volume to lower the cost of each item. For general managers, network in your community to benefit charities and, at the same time, bring more recognition and traffic to your facility. How does this fit in with the 15% principle? Read Job #5 to find out.
JOB #5 - For professional growth, the fifth factor is to conduct an assessment of your business at the end of each year. Analyze and determine the bottom 15% of your business and make a conscious decision to terminate those activities. For pro shop owners, this means making a decision to drop the bottom 15% of your inventory and product lines based on gross margin profitability (not to be confused with gross sales). For tennis directors and teaching professionals, analyze which days of the week, and times of the year, are most active in terms of lessons and clinics and concentrate on those times. I have seen too many teaching pros hanging around during slow times when they could be doing something far more productive. I am not recommending that they necessarily leave the facility or get another part-time job. I am recommending, however, that they evaluate how they use their time and consider how to use it most productively. For event coordinators, the same process is important. If an event or activity doesn't succeed, drop it. Avoid conducting the same uneventful event twice.
In other words, no matter what your job description, consider setting goals that focus on the top 15%. Also realize that the best professionals in the industry will go further than that. The leaders of the pack will intentionally try to expand it. Who knows? In a few years' time, you may be the one whose success forces us to rewrite this article and call it "The 30% Solution." Something to look forward to.