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This is an update of a post from May 20, 2007. Last year, I posted the title as a question: “Is it time to rethink our market area?”

As you can see, today I’ve titled the post as a statement. “Rethink your wedding market area, now!”

A recent trip to California revealed many gas stations in the $4.00+ range. Don’t look for this to change any time, soon. In fact, plan for gasoline prices to continue to climb. The point of this post is not to debate the governmental, political or business reasons. It is to simply to acknowledge the reality for the small business that delivers or services the client, away from its office, and offer some straightforward discussion of choices you have.

==== Original post from 5/20/07 (with some minor updates)

Granted, I’m easily annoyed by insipid local TV news reporting, but I’ve grown really tired of two specific stories. I mean ‘yell at the TV’ annoyed.

1. Gas prices hit new high (either locally, nationally or both)
2. Stay tuned for where to find the lowest gas prices in your area

What incredible nonsense. First of all, the fastest ways to save money on gas are:

1. Trading in your gas guzzler for a more efficient, higher mileage vehicle
2. Driving less

If your business vehicle is a van, truck or other such commercial vehicle, then trading it in next week is problematic. Other than bunching your errands, driving less, when it comes to deliveries or point of service driving cannot be changed overnight, either. So what to do?

Maybe it’s time to redefine your primary service area? Simply put, the radius of time and distance from your business that you choose to do 80% to 90% of your service.

If you service a major metro area, chances are that driving conditions have become more congested, time consuming, and expensive (gasoline, tolls, etc.,), little by little, over a period of years. Now, with volatile gasoline prices, it has just become more obvious, every time you go to the pump.

I had two previous incarnations in the mobile DJ business, both in the San Francisco Bay Area. On my second time around (Designer Music), I decided, specifically, what types of jobs my company would do, and where we would do them.

More precisely, I chose to market my wedding and other event services from San Francisco (on the North) to Palo Alto (on the South). That was essentially a 40-mile stretch down the San Francisco Peninsula. I elected not to market into Marin County (North, across the Golden Gate Bridge) or into the East Bay (Oakland-Berkeley and beyond) across the Bay Bridge. On the South, I stopped short of Silicon Valley.

At the time, gas prices were not part of my thinking. My wedding marketing logic was far more straight forward.

• Designer Music would not earn a premium by traveling further than the area I had defined, so any extra distance had no real financial benefit.
• By containing the market area, there would be a huge, cumulative saving of time, vehicle wear and tear, and risk of lateness to unpredictable traffic issues (i.e. an accident on a bridge).
• By staying in a tighter radius, Designer Music would serve more of the same venues, repeatedly, thereby solidifying its visibility and relationships with those venues.
• There was more than enough business for my company in the defined service area. Straying beyond the defined borders would only represent insecurity, on my part, not an actual market necessity or benefit.
• …. and our gas bills would be lower.

Designer Music would gladly accept the occasional booking in San Jose or Berkeley, but we would not actively try to develop new business outside the defined market area, PERIOD. No bridal shows, wedding publication print ads…. zip.

Over time, if you were to plot Designer Music bookings on a Bay Area map, the result would show about 90% of all activity in the defined market area.

Never would this become more significant or obvious, than in the wake of the 1989 earthquake that damaged the San Francisco-Oakland Bay Bridge, closing it for one month. In that 30-day period, our schedule had just one booking across the bay. As booked, it was the second job, in a two-job flow, and would be impossible to get to, in a timely manner, with the available driving patterns.

We were able to call one of our friendly competitors (Musique Nonstop) in the East Bay who had a similar problem, coming to San Francisco for a booking, that same day. We agreed to talk to our clients about swapping bookings to make it work. The clients were thrilled that we were thinking creatively, and all was resolved. Happy brides and grooms, all around.

This scenario came back to mind a couple of months ago, when a fuel truck exploded on the access ramp on the Oakland side of the Bay Bridge, melting the roadway, and creating a multi-month traffic nightmare, if not a complete closure.

Ask yourself this question: If you were starting your business, today, how/where would you define your wedding market area?

You’re probably not starting today, but don’t let that stop you. If you redefine your market area in a more concise fashion, over a year or two, you’ll have a much more efficient and cost-effective situation.

One closing note: After the earthquake scenario, we actually turned down business outside of a defined radius (unless it was an existing client). We developed great mutual referral relationships with other businesses that preferred not to come to San Francisco. Ultimately, that policy served both our business and the clients extremely well.

So get an area map, post it on a cork board on the wall, and start using some push-pins. Color code the push-pins for venues (that you work with, or would like to work with). Then, use different color pins to chart the location activity of your bookings for the past two years. You shouldn’t be surprised if your redefined market area jumps right off the wall…. figuratively speaking.

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FEEDBACK REQUEST: If you’ve made any business changes to address gas price challenges, since last year, I encourage you to comment and share with the rest of the readers.

Technorati Tags: cost of doing business, gasoline prices, market area, Relationship Marketing, wedding market area

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written by Andy Ebon \\ tags: cost of doing business, gasoline prices, market area, Relationship Marketing, wedding market area