Understanding Your Market – By the Numbers

Analyzing demographics and psychographics is an incredibly useful tool to assist in every aspect of feasibility testing, new product development, and simple site selection.  The process used to be cumbersome, and not for sissies!  But since the advent of MapPoint, almost anyone can do a simple version of a demographic exercise.

The Beneficial Business Features of MapPoint:

• MapPoint has an incredibly easy demographic feature.  Choose up to 16 different demographic points at once – such as population, income, household size, and age – and  then instantly  MapPoint arrays these features by state, county, city, MSA, zip code, or even Census tract.
• A shaded map will show the various areas by any single demographic chosen – such as number of businesses per zip code, teenagers in a particular census tract, or household expenditure patterns for any city in the United States.
• Once the demographic factor is selected and mapped,  a radius of any number of miles around a site can be created and then instantly exported to an Excel Sheet.  With the numbers in Excel, manipulating data to get a clearer snapshot of the type of customers  in or around the site is simple.
• Radii can be adjusted, expanded or a second radius created and then re-exported  for a new area into another Excel Sheet.  By simply copying and pasting new numbers into the first Excel sheet and repeating for other locations or radii, an instant comparison of multiple locations is created.
• MapPoint can also find and map competitors.  The map will not only list a fairly accurate number of competitors within a preselected distance from your business, but it will also pinpoint the exact distance of a business from your site, as well as their address and phone number.
• You can import data from an Excel Sheet, and thus map multiple addresses.  This is an ideal tool  to determine where the customers on a  mailing lists are actually located.
• Another useful feature in MapPoint indicates expenditure per household  for various products such as electronics, books, food, etc.   This information can also be narrowed to a particular radius and census tract, thus allowing a better picture of how much money people in your area spend in a year on your products.
• Plus, on top of all that, MapPoint offers a GPS tool, and driving directions can be created based on shortest distances, preselected locations, and fastest routes.  It can also calculate the cost of gas required to visit those locations.

BELOW IS A MAPPOINT INCOME DIAGRAM FOR A LOCATION IN GLENDALE

Glendale Income Map

Very simple.  But you might have some questions.  If you do, call or email me. (jill@jbresearchco.com, 805-640-1060)  I’ve been doing this for 20+ years, with or without MapPoint!

10 STEPS TO DEVELOPING A SUCCESSFUL MUSEUM, THEATER/NONPROFIT PLAN– AND WHY YOU SHOULD CARE

<META name=”y_key” content=”464beeb6a69a1160″>

Many of my readers do not know that a large part of my practice is devoted to consulting to museums, performing arts centers and other cultural and nonprofit venues. There is sometimes a disconnect between developers and nonprofits.  After all, if you are in the business of making money, why would you include a non-money making business in your project?

I once had a client who hired me to do a museum business plan for his very successful consumer product.  When the report was finished and initial schematics presented, he asked, “Why should we build a museum when it won’t return 20% on our investment?”

The arts make good business.  They lead many educated and affluent consumers to our projects and they contribute mightily to the programming and animation of public spaces.  Nonprofits are good citizens.  In a world where developers may be seen as unpopular, including nonprofit spaces in a commercial project is a strong inducement to securing needed entitlements.  Still, many commercial developers do not understand that nonprofits face the same planning and marketing issues as commercial entities.  Until about 50 years ago, nonprofits figured they didn’t have to do business plans because they were just going to lose money anyway.  So why have a plan?

Nonprofits must have a well-articulated carefully planned strategy for capital, operating and future funding or they will not receive ANY funding in the first place – not from friends, government, dispassionate individuals nor foundations!  Nonprofits are businesses, just like any other.  And the last thing you want as a developer is to have a failing tenant in your center.

So here are 10 steps to look for when evaluating a proposal from a nonprofit. Also, for nonprofits, these are the steps you should take before presenting to a developer or planning an expansion or new facility:

1. Have a realistic and defensible business plan.
2. Determine the annual operating deficit.
3. Project attendance and per capita revenue/expense within normal ranges.
4. Study national comparable museums, including your favorite models.  Know attendance, operating budget, per capitas, other important metrics.
5. Know your market, including the all-important market area demographics and psychographics.  There are now reputable services that provide these trade area metrics for very little money.
6. Study 990s.  These are your best friends.  They are the income tax returns that nonprofits must file and they provide you with all financial information for your competitors and comparables.  They are public record!
7. Take time to study comparables in the local market.  Most important for these comparable studies are annual attendance, budget, and resident trade areas.
8. Make sure to include changing gallery space in your design.  Return visitation is key to your nonprofit and residents will comprise the majority of your attendance.
9. Interview executives at the models you envy.  They normally will assist if you are outside their market and they can be a wealth of knowledge.
10. Finally, get professional help because you are not objective!  A good consultant can save you thousands in mistakes!

MEET GEN Z – YOUR NEWEST MARKET

Well, it has finally happened!  We are beginning to market to zygotes!  Yes, the new Generation Z includes kids 15 years of age and younger.  They are already being studied so we can figure out how to sell them Coke, toothpaste, soap and of course, technology.

I have some experience with the oldest of this generation, which is expected to at least equal the size of the Baby Boomers, when the final cutoff date is established.  Both my husband and son teach math to 15-year olds.  It is very strange that they both make the same assessment of their students, calling them “aggressively entitled children.”  I find it strange because one of them teaches the poorest children in our county, and the other teaches the wealthiest children in his region.  How has this happened?

These kids are treated with kid-gloves with very structured activities and schedules.  They are being raised by helicopter parents, and as such, they have tremendous capabilities and are a bit precocious.

So, here are 12 observations about and predictions for the new generation:

1. Gen Zs have never known a world without cell phones, computers, or the Internet.
2. They are more exposed to information, music, movies, other cultures and photos than any other generation.
3. They can absorb a lot of information, but prefer it in short fast grabs (like Twitter).
4. They will use their technology, small networks, and innovations to make a difference in their world.
5. They are passionate about their interests because of the vast amount of information they can access.
6. They are good at multi-tasking since they often use the mobile phones, computers and gaming systems simultaneously.
7. Through multi-play computer gaming, they are learning collaboration, leadership and quick strategy planning, so cooperation and problem-solving will become second nature to them.
8. They will be more environmentally aware than previous generations since global warming and climate change are important today.
9. They may have more degrees, certificates and diplomas than any other generation.
10. Many Gen Zs will have experienced unprecedented prosperity followed by significant economic turmoil before they reach adulthood.
11. Gen Z families are smaller than previous generations.  Their parents are older and most mothers work without the guilt of past generations.
12. Their parents range from young Baby Boomers to older Gen Yers, with the bulk of parents being Gen Xers.  Many have “traditional values.”