Posted: Tue 2nd Mar 2021
Andy Haldane, the Bank of England's chief economist, says the UK economy is "poised like a coiled spring" for a bounce back as people look ahead to spending what they've saved during the lockdowns.
Providing experiences to local people offers an excellent way for your business to benefit from this 'bounce back'. Experiences were already one of the fastest-growing parts of the leisure sector, and this is likely to continue as people are eager to spend time with friends and family in their local area.
Since launching Yuup, where we sell over 200 experiences in Bristol, we have seen incredible demand for a wide range of experiences. We have discovered an audience for scrap metal art, yoga, street theatre, knitting, photography, cooking and writing experiences, to name a few.
Experiences are easy to set up and offer a revenue stream for an existing small business (or even a platform to start a new one). Enterprise Nation asked us to share some of the things we have learned in Bristol:
Most businesses have the skills, equipment and space already, meaning there are almost no costs beyond the day's materials. Businesses can therefore dip their toe in the water with minimal risk, and if there is demand, the profit margin is significant.
For example, a graphic designer could offer a logo experience, offering 'design your own personal logo'. The experience could be made very special for an individual paying over £150 or extended to a group of six, each paying about £30 for a two-hour session (these costs represent the averages we see for similar experiences on Yuup).
The additional revenue is significant, but we have found the key benefit is identifying new local customers. To illustrate this, let's look at a local retailer, for whom the last few years have seen a rise in online competition, as well as the reduction in footfall as people go to their local high street less (even before the pandemic).
A florist who runs a flower arranging experience gets to spend two hours with local people interested in flowers. These people now know the florist by name and are more likely to pop in and spend a little extra on flowers. On Yuup, we have seen this outcome for many businesses whose experience participants become regular customers.
For many hosts, experiences allow them to follow their passion alongside other jobs, or to test their ideas before taking the leap to set up a new business.
Hard to compete with
Physical experiences have the advantage that they are hard to compete with. If you are a cook, you can (and should) offer virtual experiences, but you are competing with every other cook on the planet (there are currently 250 on Airbnb). However, physical experience cannot be undercut virtually.
Of course, whatever the experience, there will be some costs, even if it just refreshments, although as you are setting your price, these can be factored in. The main effort goes into experience design, marketing and your time. Fortunately, there are lots of ways to help reduce the risk:
Don't over complicate
When reading the reviews on Yuup, it's the human interaction people cherish most. People love spending a few hours with a passionate, friendly person who shares their knowledge willingly.
Plan four dates, market to existing customers or through existing channels, such as Facebook or existing customers, and see what works. You may even want to consider not charging for a couple of test experiences and just focus on feedback. (If you are in Bristol, then you can use Yuup.)
Invest your time in getting the experience right
Putting time in reaps rewards. We have seen a direct correlation between hosts' commitment and their experiences' successes. Experiences need to be planned, and that takes time.
Over the coming months, people are likely to crave human contact and exciting things to do. Experiences offer millions of customers both - and therefore offer businesses a real opportunity.