Development of a complex of marketing services for a dance studio. Marketing activities of the dance studio "Black and White"

In this part of my work will be carried out competitive analysis marketing activities Royal Epoch School of Dance Arts LLC and some of its closest competitors. The analysis is carried out in order to determine the current competitive position of the company in the market and will include the following methods: the Herfindahl-Hirschman index and the market model of M. Porter.

After applying each of the methods, based on the data obtained, conclusions will be drawn and recommendations made.

It is important to note that both the analyzed company and its closest competitors operate in the historical dance services market. Since this segment of the dance market is very narrow-profile and does not involve the circulation of large financial flows, all companies do not place their financial information in the public domain and are not open companies. What's more, some of the Royal Era's competitors don't even have legal personality. In view of the above, it seems very difficult to calculate their market share because:

a) financial indicators unknown;

b) there are no natural indicators for this situation, since all firms produce services;

c) size client base classified.

In this regard, the market share of companies will be determined by the expert opinion of the author. The right to the author of this analysis to issue an expert opinion is given by his one and a half year experience in the field of historical dances, as well as the fact that he is a former CEO School of Dance Arts "Royal Era", its founder and co-founder.

PEST analysis

As I mentioned earlier, Royal Era operates at the intersection of three markets. To conduct a PEST analysis and present it in a tabular form, I will choose one of the areas of activity of the company, namely the dance services market. Description of the conceptual tools used by me in the analysis, see Appendix 1.

Table 5. PEST analysis of the company's macro environment

	Description of the factor (one example for each)	Relative significance of the influence of the factor	Impact on company strategy
By time		By dynamics	Significance
	Decree of the Government on the need to license dance teachers.			All teachers will need to be certified. On the one hand, this will take time and entail small changes, for example, in the class schedule, but on the other hand, it will strengthen the company compared to competitors.
	Bolotnoye case, Olympic Games in Sochi, revolution in Ukraine.			Violent current political issues do not directly affect the company's business.
	Lack of interest in joint projects from KC.			It is necessary to develop cooperation with cultural centers and introduce partnership marketing.
	The fall of the ruble against the dollar.			Since the firm's revenues depend on the currency in which its clients are paid, this factor has very little effect on the company, since almost all clients are paid in rubles, and an increase in dance prices can reduce the number of clients.
	Offensive economic crisis as a result, a decrease in wages of the population.			Initially, it is necessary to increase consumer loyalty by holding various promotions, contests, and issuing prizes. At the same time, it is necessary to review pricing policy, develop a system of discounts and bonuses. Alternatively, on the eve of the crisis, you can announce a series of big balls, sell tickets in advance, killing two birds with one stone: first, the company will provide itself with a financial pillow, second, customers will have a clear learning goal - attending a galaxy of balls - which will give them an incentive to going to dance classes.
	The proximity of summer and, as a result, a decline in sales. Seasonality, natural factor.			Since there are practically no balls in the summer, the company needs to develop a seasonal sales promotion strategy. Alternatively, you can conduct free master classes under open sky in parks and crowded places, increasing the company's visibility and attracting new customers.
	A massive boom in learning hustle, a cultural factor.
	The presence of uncovered target audience among university students.			Opportunity for the company to open branches on the basis of universities and hold classes and balls for students and teachers. Prospects for expanding and increasing financial and client flows.
	Little known historical dances among the general public. Cultural factor associated with the loss of cultural values.			An opportunity for a firm to build a competitive advantage based on an extraordinary service, thereby increasing consumer interest. However, in the long term, it is worth considering the declining trend of this factor.
	The annual holding of historical festivals and military reconstructions by the Moscow City Administration.			This factor gives the School the opportunity to take part in a popular cultural event, make partners, increase its reputation among clients, and gain experience in interacting with an unusual project.
	High rotation, customer turnover			With each new dance season, the company has to look for new clients for dance classes, as the old ones either go to other schools or lose interest in classes. Here it is possible to introduce a special loyalty program, for example, a discount system for "old" customers, or gradation of knowledge levels by groups: beginners, continuing, pros, respectively, with the development of a unique dance program for each of the groups and the choice of a competent teacher.
	The emergence of quality free video tutorials most historical dances on the internet.			Developing your own lessons, positioning them as necessary study guide for a better dance experience. It is also possible to make video recordings of balls like viral advertising and promote their viewing among the audience.
	The need to create a high-quality modern site with dynamic content.			A modern website is a vital necessity for a business. On the one hand, its creation requires significant investments (about 50,000 rubles), on the other hand, this will increase the loyalty of current customers and the influx of new customers.

The performed PEST analysis shows that the market in which the company operates is highly elastic in terms of customer income and interest (VI). In other words, with a decrease in the population's income and with an increase in the interest of a potential or real client in a different dance direction, the demand for the services offered by the "Royal Era" may decrease sharply. Such findings suggest that strategic activity of the company should be aimed precisely at effective pricing, increasing the loyalty of current and attracting new consumers.

Herfindahl-Hirschman index and CR3

To build the Herfindahl-Hirschman index and assess the level of competition in the market, it is necessary to indicate the market shares of the companies in question. Then the index will be interpreted. For comparison, four firms were selected, including the Royal era, which, according to peer review of the author are leaders in the capital market of historical dances.

Table 6. Market share of Moscow historical dance schools

It is worth clarifying that the average number (about 5) of competing firms operates on the Moscow market of historical dances ( legal entities), but there is a very big number namely “historical dance circles” organized on the basis of various universities and focused on attracting students studying in these universities to classes and balls. Classes in such circles are either very cheap (100 rubles per lesson), or are generally free of charge, which drastically undermines the activities of commercial firms such as the Royal Era. The attendance of such almost free classes is very high, these circles not only take away the market share from the compared firms, but also force them to continuously develop competitive advantages and constantly struggle to attract a new client. There are about 50 schools and clubs in Moscow where historical dances are taught and historical dance events are held.

Before calculating the index, let's assume that, with the exception of the four firms considered, all other firms and circles (50 - 4 = 46) have equal market shares. In this regard, small adjustments will be made to the calculation of the index, namely, the shares of all “other” firms will be calculated taking into account their weights. Let's calculate the Herfindahl-Hirschman index for the industry using the supplemented formula:

The found index (403.5) shows that the market situation refers to monopolistic competition, which, frankly, was obvious even without calculating this index, judging by the number of competing organizations and price differentiation of services.

We also calculate the CR index (Concentration Ratio) for the three described firms - the largest economic entities operating in the presented market:

The obtained values of the CR index, equal to 27.8%, and the HHI index, equal to 403.5, demonstrate a low level of market concentration, that is, they indicate the absence of clearly dominant organizations occupying the lion's share of the market; there is a relative equality of market shares of the main players on the market. A similar factor can be used by the Royal era, I repeat, to implement the strategy of mergers and acquisitions, perhaps the organization of alliances. Under the condition of effective corporate and collective management, a synergy effect can be achieved, and this will be an indicator of the correctness of the choice of this strategy.

Table 7. Levels of Market Concentration

Concentration level

Moderate		1000?HHI<2000

Recommendations. With such a large number of firms, a M&A strategy would be effective for the Royal Era, allowing it to reduce the level of competition. However, this strategy will entail high transaction costs for finding information and negotiating, as well as financial costs for making deals. On the other hand, if we consider this strategy in the long term, it seems to be quite advantageous, since it will increase the market share of the company and its production capacity.

Competitive Market Model by Michael Porter

Threat from new competitors. The likelihood of new competitors high for the following reasons:

v low entry barriers, no need to attract large investments to open your own business in this segment;
v low switching costs are obvious: in case of failure (insufficient demand) for historical dances, firms can reorient themselves to other dance directions;
v the scale of services provided is very small;
v the provision of services for teaching historical dances and conducting is not characterized by a large need for capital;
v there is a weak state regulation of this market segment, there is no need for firms to obtain special patents and licenses.

On the other hand, the segment under consideration cannot be called extremely attractive, since it has a high level of competition and significant price differentiation.

Threats from substitute products. The likelihood of such a threat extremely high:

v there is a possibility that the interest of customers may switch from historical dances to other dance styles, of which there are many in the metropolitan market, for example, hip-hop, boogie-woogie, sports dances. In my previous work, when conducting a PEST analysis, I noted that such a progressive and easy-to-learn dance direction as a hustle is currently the most attractive replacement for everything else, it is in high demand and provokes a client turnover, in our case, from historical dance schools to hustle schools.
v in most cases, ballroom culture does not attract modern youth, so discos in clubs and modern dance floors can serve as a fairly strong analogue of balls and dance parties.

Vendor Threats can be described as average. In general, the suppliers of the "Royal Era" and its competitors include landlords, in whose premises dance classes, balls and dance parties are held. Accordingly, in the event of rent fluctuations, firms find themselves in a stressful situation.

Threat from buyers is high:

v constantly growing requirements of customers in relation to the quality of services provided;
v there may be a decrease in demand due to current financial changes in the Russian market and the weakening of the ruble against the currency;
v the availability of a large number of substitute products gives our customers the potential to reduce the consumption of the service we offer;
v the industry of buyers is not numerous, which forces the company to take into account the interests of almost every consumer and complicates lobbying of its own, since a new client, if the old one leaves, may not come;
v our customers in the ballroom community are concentrated in tight groups, so any wrong action of the company can dramatically affect its image and demand for the service offered due to word of mouth. On the other hand, this state of affairs can also be a plus with the right actions of the company.

Competition within the industry- high. The royal era operates in a market of monopolistic competition with services whose supply is highly differentiated in terms of price. Moreover, the threats of new competitors, threats from substitute products and buyers are high, which also complicates the company's life process.

The author's personal opinion is that, despite the high degree of threats considered, the historical dance market is not yet oversaturated and is not in the stage of stagnation: the growing demand for the services offered by the Royal Era and its competitors, along with the spread of the historical ballroom trend, indicates reverse. However, in order to become number one in this growing market, especially in the face of continuous and numerous rivalry, a competitive strategy with a clear definition of competitive advantages is required that will allow such a company to rise to leadership positions on the crest of a market wave.

This form contains 5 tables, each of which evaluates the threat level of one of the five forces of competition according to Michael Porter. Each table lists the parameters for assessing competition and provides a brief description of them.

Goods substitutes

Competition from manufacturers of substitutes (substitute goods) depends on their availability, availability in terms of quality and characteristics, and the willingness of consumers to switch to their use. Competition from substitutes depends on whether it is easy or difficult for consumers to reorient themselves to it, what is the cost of reorientation. The lower the price of a substitute, the lower the cost of switching to a substitute, and the higher the quality of the product, the stronger the pressure of competitive forces from substitutes.

The pressure of producers of substitutes on producers of original goods is manifested in the following:

- Producers of substitutes can set an upper price limit, the increase of which is fraught for the producer of the original goods with a drop in sales volumes and, as a result, profits.
- Producers of substitutes encourage consumers to compare their price, features and quality with the original product. If this comparison is not in favor of the manufacturer of the original goods, then there is a drop in sales. For example, the production of e-books and other devices with similar functions have significantly reduced the sales of traditional books.

Table 8. Assessment of the level of competition from substitute products

Parameter Estimation
Evaluation parameter	Comments	exist and have a high market share	exist, but just entered the market and their share is small	does not exist
Goods substitutes "price-quality"	More low quality at lower prices	Imperial style, direct competitor
High level of threat from substitute products. Sold almost for free. You need to invest in promotion.
Substitute goods capable of providing the same quality at lower prices
It is necessary to track this substitute product, because the company specializes more in Scottish dances and square dances, and not in a complex of dances of the 19th century.
Substitute products capable of providing higher quality at lower prices	Ball in the Russian estate. Direct and main competitor. In CE, a revision of the existing product policy and pricing is required.
There is a displacement of our service from the market, CE has nothing to oppose to a competitor.
Substitute goods capable of providing the same quality at the same prices
Substitute goods capable of providing the same quality at higher prices	Viennese Ball
The appearance of substitute products is not dangerous, occurs once a year, is designed for a one-time action, and not a duration in time.

Direct competition

Competition between companies - intra-industry rivalry, this competition can be characterized as follows:

- companies fight for the most advantageous position in the market, using a variety of periodically updated strategies;
- companies in the process of competition affect the market, changing the conditions of supply and demand.

Table 9. Assessment of the level of intra-industry competition

Parameter Estimation
Evaluation parameter	Comments
Number of players	The more players in the market, the higher the level of competition and the risk of losing market share	High level of market saturation
Market Growth Rate	The lower the market growth rate, the higher the risk of permanent market redistribution
Level of product differentiation in the market	The lower the differentiation of the product, the higher the standardization of the product - the higher the risk of switching the consumer between different market companies	The product on the market is standardized in key properties, but differs in additional benefits
Restriction on price increases	The fewer opportunities to increase prices, the higher the risk of losing profits with a constant increase in costs	There is an opportunity to raise prices only as part of covering the increase in costs
Final score: 3 + 1 + 2 + 2 = 7	1. ?4 points: low level of intra-industry competition 2. 5-8 points: average level of intra-industry competition 3. 9-12 points: high level of intra-industry competition

Potential competitors

Many organizations do not pay due attention to the possible threat from potential competitors and therefore lose in the competition precisely to the companies that have newly entered their market. It is very important to remember this and to create barriers in advance to the entry of potential "aliens". The emergence of new competitors in the market leads to a redistribution (reduction) of market shares previously owned by companies operating in this market (in the analyzed product segment). The commissioning of new production or trading facilities entails increased competition and, as a result, lower prices and lower profitability. The likelihood of new competitors entering the industry depends on two main factors:

1) Entrance barriers: the impossibility of economies of scale; disadvantageous position in terms of costs and resources; no learning effect; consumer loyalty to brands; lack of necessary investment; unavailability of distribution channels; actions of regulatory authorities; tariffs and international trade restrictions, etc.
2) Expected responsiveness from companies operating in the market.

Table 10. Assessment of the threat of entry of new players

Parameter Estimation
Evaluation parameter	Comments
Economies of scale in the production of a good or service	The larger the volume of production, the lower the cost of purchasing materials for the production of goods, the less the fixed costs of production affect the unit of production	absent
Strong brands with a high level of knowledge and loyalty	The stronger existing brands feel in an industry, the harder it is for new players to enter.	no major players
Product differentiation	The higher the diversity of goods and services in the industry, the more difficult it is for new players to enter the market and occupy a free niche.	there are micro niches
Level of investment and costs to enter the industry	The higher the initial level of investment to enter the industry, the more difficult it is for new players to enter the industry.	medium (pays off in 6-12 months of work)
Access to distribution channels	The more difficult it is to reach the target audience in the market, the lower the attractiveness of the industry	access to distribution channels requires moderate investment
Government policy	The government can limit and close the possibility of entering the industry through licensing, restricting access to sources of raw materials and other important resources, regulating the price level	no government restrictions
Willingness of existing players to reduce prices	If players can lower prices to maintain market share - this is a significant barrier to entry for new players	players will not go for price cuts
Industry Growth Rate	The higher the growth rate of the industry, the more willingly new players want to enter the market	tall and growing
Final score: 3 + 3 + 2 + 2 +2 + 3 + 3 + 3 = 21	1. ?8 points: low level of threat of entry of new players 2. 9-16 points: average level of threat of new players entering 3. 17-24 points: high level of threat of entry of new players

Bargaining power of buyers

Consumers oppose the interests of competing companies with the help of special means of influencing the market, which leads to lower prices, higher product quality, and an increase in the quantity and quality of services consumed.

Table 11. Bargaining power of buyers

Parameter Estimation
Evaluation parameter	Comments
The share of buyers with a large volume of sales	If buyers are concentrated and buy on a large scale, the company will be forced to constantly make concessions to them.	Sales volume is evenly distributed among all customers
Propensity to switch to substitute products	The lower the uniqueness of the company's product, the higher the likelihood that the buyer will be able to find an alternative and not incur additional risks.	the company's product is not unique, there are complete analogues
Price Sensitivity	The higher the price sensitivity, the higher the likelihood that a customer will buy a product at a lower price from competitors.	the buyer will always switch to the product with a lower price
Consumers are not satisfied with the quality of existing on the market	Quality dissatisfaction generates latent demand, which can be satisfied by a new market player or competitor	dissatisfaction with the secondary characteristics of the product
Final score: 1 + 3 + 3 + 2 = 9	1. ≥4 points: low threat of customer exit 2. 5-8 points: the average level of threat of customer exit 3. 9-12 points: high risk of losing customers

Bargaining power of suppliers

Suppliers influence the competitive struggle in the industry, mainly through the following means - price, quality, volume and terms of supply of goods and services.

Table 12. Bargaining power of suppliers

<...>Almost all respondents have a long dance experience, necessary and sufficient to make fair judgments and make comparisons. This confirms the relevance and validity of the data obtained.

34 out of 38 respondents attend balls more than 3 times a year, that is, they have sufficient experience to compare different approaches to organizing events in different schools. This again testifies to the fairness of their assessments and the significance of the study.

It is important to note that more than 50% of respondents never attend outdoor dance events - balls that are held in cities other than Moscow. In part, this indicates a lack of interest among respondents in attending such balls, and in part, an unwillingness to spend resources for mobility to another city. Nevertheless, 15 people (39%) are ready to periodically leave Moscow to attend non-resident balls.

Looking at the chart with information about the marital status of the respondents, we can say that the vast majority are not married. This information correlates with information about the age of the respondents, since more than half of them have not yet reached the age of 30, and half are not yet 25. At the same time, this diagram confirms that, in general, unmarried people are engaged in historical dances, since they find free time for this and have a proper interest. Married people, perhaps in most cases, prefer to spend their free time not at dances, but with their families.

Evaluation of selection criteria

In order to understand which factor is the most significant for a consumer when choosing a dance school or using its services, a list of 18 criteria was compiled that consumers consider when choosing a dance school. Respondents were asked to evaluate how important each of the criteria is for themselves on a six-point scale, where the value "1" corresponded to the low significance of this criterion for the respondent, the value "6" - high, and the values "2-5" - intermediate.

The choice of a six-point scale as different from traditional scales is not accidental. The researcher was faced with the question of which scale - Likert, semantic differential or binary - to conduct a survey, however, in this case, the most appropriate was the use of a six-point scale. The binary scale offers only two response options, which would not allow for a wide range of output data for comparison. The Likert scale resembles the traditional school grading system, moreover, the types of answers do not establish known and equal intervals between themselves (the difference between “strongly agree” and “agree” is not always the same, whether it concerns different points of the scale or different respondents). And therefore, it is meaningless and incorrect to add these numbers together, not to mention averaging them. On the contrary, the advantage of the semantic differential technique is that it can be quite easily modified, and the use of adjectives specially selected by the researcher makes it possible to develop target scales focused on specific groups of respondents. However, according to statistics, there is a high probability that the respondent chooses a neutral, zero value, which can be caused by both subjective factors (for example, unwillingness to fill out the questionnaire, the desire to fill it out quickly and somehow), and objective (if the respondent does not know any information or neutral relation to the issue). The presence of a zero value in the scale would affect the results, making them more average. On the contrary, in an effort to obtain the most differentiated and all the more interesting results, I decided to use a six-point scale that excludes the median value. The remaining six estimates, passing to the language of the semantic differential, corresponded to the following values (the first digit is used by me, the second is in the differential): "1 = -3"; "2 = -2"; "3 = -1"; "4 = 1"; "5 = 2"; "6 = 3". The survey showed which factors are most important for consumers, and these results can be used by the organization in the future to increase consumer satisfaction.

Table 13. Importance of criteria when choosing a dance school

Parameter Estimation
Evaluation parameter	Comments
Number of suppliers	The fewer suppliers, the higher the likelihood of unreasonable price increases	Wide choice of suppliers
Limited supplier resources	The greater the scarcity of suppliers' resources, the greater the likelihood of price increases	unlimited in scope
Switching costs	The higher the switching costs, the higher the risk of price increases	low costs for switching to other suppliers
Vendor Referral Priority	The lower the priority of the industry for the supplier, the less attention and effort he invests in it, the higher the risk of poor quality work	high industry priority for the supplier
Final score: 1 + 1 + 1 + 1 = 4	1. ≥4 points: low supplier influence 2. 5-6 points: the average level of influence of suppliers 3. 7-8 points: high level of supplier influence

	Criterion	Average importance








	Price level for balls/dance evenings

	School reputation

	Ball frequency



	Convenience of locker rooms

The data from the third column was obtained through the arithmetic mean of 38 ratings given by each respondent to a specific criterion. As we can conclude from the table, the following parameters are the most significant for consumers (in descending order of importance):

1. Quality of teaching in dance classes (general impression) - 5.50;
2. Knowledge, skills, skills of teachers in dance classes - 5.47;
3. Convenience of days and times of dance classes - 5.08;
4. The quality of holding and organizing balls and dance evenings - 5.03;
5. Price level for dance classes (single lesson and subscriptions) - 4.68;
6. The quality of the premises chosen by the administration for holding balls and dance evenings - 4.66;
7. Location and location of dance classes - 4.39.

As we can see, the most important factor in choosing a historical dance school for consumers is quality in any of its manifestations, in second place is the price of dance classes. It is natural to conclude that the first thing a potential client looks at is the competence of teachers and the quality of the training provided, then there is a comparison of the days of the lesson with the personal employment of the consumer. If these two schedules coincide, then the potential client gets acquainted with the portfolio of already held balls and events, reads reviews, views photos and videos. Only after that the client perceives information about the cost of the lesson.

It can also be seen that such parameters as the intensity of advertising, the convenience of locker rooms, the availability and functionality of the site, the participation of the school in various third-party events are practically not important for consumers. Based on the results of the survey, the consumer, in principle, does not care what reputation the school has. Additional options, such as the competence of the administration, the frequency of balls and dance evenings, the discount system play a medium important role for the client. It is also worth emphasizing that the importance of the cost of an invitation ticket to a ball or dance evening is only in 9th place with a score of 4.08, that is, it is half important for the client.

Analysis of the performance of firms

In addition to evaluating the importance of the criteria, an analysis was made of how effectively each of the three considered firms in their business activities meets all 18 criteria. Respondents were asked to select one, two or three schools for evaluation. The choice of school was made by respondents depending on how much knowledge they have about the activities of this school. School evaluation statistics are presented in Figure 16. The diagram shows that in 38 questionnaires respondents rated the Royal era 30 times according to the criteria, 19 times the Imperial style and 11 times the Ball in the Russian estate. The evaluation of a school by a specific criterion was also carried out on a six-point scale, with the value "6" corresponding to the best manifestation of this criterion in a given school, and the value "1" - the worst. As a result, the following results were obtained, presented in Figure 24.

Figure 24. Radar chart

We will consistently interpret the data obtained, compare them with competitors and offer the Royal Era recommendations for improving its strategy.

Table 14. Comparison of firms by key criteria

Criterion		Royal era	Imperial style	Ball in the Russian estate	Importance
Price level for dance classes (single lesson and subscriptions)
The royal era is inferior to all its competitors in terms of price, that is, in this company, prices are the highest among others.	IP is the price leader. Classes in it are shareware-free (100r.2 hours)	One lesson in BRU costs 350 rubles for 2 hours, which is higher than that of IS, but lower than that of EC.
Price level for balls and dance evenings	UC points/t-in
The price is quite high, about the same as in BRU.	Unprecedented cheap or completely free tickets.	The price is quite high, about the same as in CE.
Location and venue for dance classes	Place T-to
The best location. Due to the fact that the place where the dance classes take place (Makarenko St., 4) is a 10-minute walk from the Chistye Prudy metro station and is located in a modern cultural center, which is convenient for the client	Worst result. The room is far from the metro, too crowded due to the fact that classes are held at the Moscow State Technical University. N. E. Bauman	Classes are held in the house of culture Gaydarovets, 15 minutes from the metro on foot.
The quality of teaching in dance classes (general impression as a whole)	Quality of training for t-to
It is a general indicator that combines the main parameters: the convenience of the hall, the skill of teachers, the convenience of locker rooms, the presence of mirrors, the quality of music, attention to students, involvement in the learning process and personal interest. For CE it has an average value.
Discount system (possibility of obtaining discounts)
There are subscriptions and special offers before the balls. In addition, promotions such as "Bring a friend - the flesh is half the cost of the lesson", "Find a secret section on the site - a 10% discount" are constantly held.	There are no discounts.	Discounts are provided in the form of subscriptions and special offers at balls, for example, the sale of a ticket at a reduced rate to schoolchildren and nonresident citizens.
Knowledge, skills, skills of teachers in dance classes	Prep knowledge
The teacher is an amateur choreographer with no special education, age 20, dance experience - 5 years, teaching experience - 3 years.	The teachers are 50-year-old amateur dancers who have attended many balls and have a fair amount of teaching experience.	They are taught by 40-year-old professionals, qualified and have a special education, ballet dancers.


The size of the hall in which the dance classes take place	Hall size t-to
Classes are held in a spacious 80 sq. m.	Large hall with an area of over 100 sq.m.	A small hall with an area of 60 sq.m.
Convenience of locker rooms
Separate women's and men's locker rooms with chairs and hangers.	There are no changing rooms.	There are no changing rooms.
Ball frequency	Part balls
2-3 times a year	2 times per year	4 times a year
Frequency of dance evenings
4 times a year	0 times a year	2 times per year
The quality of holding and organizing balls and dance evenings (general impression as a whole)	Quality of org-ii balls / t-in

The competence of the administration of the dance school, the ability to communicate effectively with it	Computer Admin

The quality of the premises chosen by the administration for balls and dance evenings	Quantity of halls for balls/t-in
Different premises, from simple dance halls to estates and palaces.	Always one room - a platform in MSTU. N. E. Bauman.	Always only estates or palaces.
Convenience of days and times of dance classes	Convenient distribution
Tue, Thu 20:00 - 22:00	Wed, Fri 19:30 - 21:00	Mon, Wed, Thu 19:00-23:00
Availability, convenience and functionality of the site
The best site.	Medium quality website.	There is no site.
School reputation	Reputation
The reputation is low, it correlates with three indicators: the price level, the quality of the events, and the competence of the administration.	Reputation is average, also correlates with these factors.	The highest reputation is fully justified by the quality of the services provided.
Participation of the school in third-party events (theatrical and demonstration performances, children's parties, charity, etc.)
Regularly participates in demonstration performances, holds balls and events to order. Apparently, this information is not broadcast enough, because clients do not know about it.	Co-organizes the 9 May celebration in the Hermitage Garden, participates in various competitions with demonstration dances.	Often participates in exhibitions and events related to the era of the XIX century, they perform demonstration dances. He also conducts traveling workshops in other cities.

Conclusions to Chapter 2

In this chapter, a practical study and evaluation of the marketing and strategic policy of the Royal Epoch School of Dance Arts LLC was carried out. A brief description of the scope of the company, its pricing strategy, the main tools of marketing promotion was given. A geo-contextual analysis of competitors was also carried out and the only competitive advantage of the company at the moment was highlighted.

Next, the current organizational structure of the company and the stage of its life cycle were considered in accordance with the concept of Yitzhak Adizes. The workflow was analyzed as one of the sources of information.

A strategic analysis of the company was carried out, including the definition of a competitive strategy according to Michael Porter, which the company is currently using - a strategy of focused differentiation. The external factors that influenced the choice of this particular strategy were named, as well as the risks that the company faces or may face when choosing this strategy. A graph of financial flows for the first year of the company's activity was built, emphasizing the importance of the seasonal factor in the company's business. Also, within the framework of this analysis, the distribution strategy and assortment strategy of the company were determined - selective and narrow specialization with partial differentiation, respectively.

Next, a competitive analysis was carried out, during which the macro-environment of the company was analyzed using the PEST methodology, the Herfindahl-Hirschman and CR 4 indices were calculated, and the market situation was determined - monopolistic competition. Porter's 5 forces analysis assessed the company's competitive environment and the overall level of competition in the industry.

The author also conducted a marketing research through the survey method with questionnaire tools. We interviewed 38 respondents who are closely associated with the field of historical dance and who study at various schools. Based on this expert opinion, key success factors were identified and ranked in order of importance. A comparison was also made between the Royal era and its two closest competitors according to the KFU. The obtained data were interpreted and strategic recommendations were proposed to improve the quality of promotion of the Royal era in the market. In addition, the main problems in the activities of the organization were identified and recommendations for behavior were also proposed.

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2. Description of the business, product or service

A dance school is a type of business in the field of additional education and leisure. You provide clients with the opportunity to learn how to dance in a specially equipped hall under the guidance of an experienced professional. It does not matter the level of training and age of the student. Groups are divided according to the degree of skill. However, as a rule, children and the elderly are engaged in separate groups.

At the dance school there is an opportunity to study both in a group and in individual lessons. The main difference lies in the cost. Individual training costs 2.5-3 times more. For each type of training, you can purchase both a separate lesson and a subscription. The Standard Membership is valid for one month and includes either 4 or 8 lessons. The subscription is nominal in nature and applies only to the person for whom it is registered.

A complete list of services with an indication of the cost you can see in the table:

Name of service	Number of lessons	Cost, rub.)
Individual lesson
Individual subscription
group lesson

Subscription for group classes
Universal subscription*
Travel pass**

All subscriptions, except for the universal one, apply only to one direction of dance and are assigned to a specific teacher. This is a necessary measure in order for the group to have a permanent composition and develop steadily. A universal subscription is an opportunity to attend 8 classes within one month in any direction and with any teacher. The only limitation is the compliance of the student with the level of physical fitness of the group.

A travel pass is valid for 2 months and applies to one dance direction. At a cost, such a subscription is more expensive than a group one, but cheaper than 8 one-time lessons. That is, if a client is forced to go on a business trip for work, then he does not lose his classes, and the school retains the client.

If a student regularly attends classes during a month, then he can purchase a subscription for the next month with a 10% discount. If a client brings a friend who buys a subscription, he (the client) receives a 15% discount.

This flexible payment system allows you to retain customers and increases demand for services.

3. Description of the market

Target audience of the dance school

The target audience of a dance school can be very diverse. Everyone loves to dance: children, adults, and even the elderly. Therefore, a more detailed definition of your audience will directly depend on what areas of dance you will develop in your school.

For example, if for such directions as belly-dance or pole-dance the target audience will be unmarried girls from 18 to 30 years old. And break-dance classes are mostly attended by young guys aged 15 to 25.

For a social dance school, the target audience would be described as follows:

Men and women aged 20 to 35 years. As a rule, these are already working people who are not married. 80% of dancers are in search of a "second half". In addition, these people are open to communication and well socially adapted. The main purpose of visiting dance classes is to take a break from work and at home, to plunge into the holiday atmosphere. They are loyal to the design and equipment of the hall. For them, the main thing is the communication that takes place within the group. An important criterion for finding a school is location, contingent, regular dance parties.

Based on the described criteria, we can conclude that the main attention in the service should be directed to establishing "friendly" relations with the client. Educators should devote extra time to holding activities that promote team building - weekly parties and organizing outdoor events. As for the external positioning of the dance school for potential clients, a friendly, well-organized team, consisting of both beginner students and experienced teachers, will stand out as the main advantage.

Competitor analysis

Competitive advantage of the dance school

4. Sales and Marketing

5. Production plan

Any entrepreneurial activity must begin with the state registration of the organization. When opening a dance school, the best solution would be to register as an individual entrepreneur. The indicated OKVED code is 92.34.2. Activities of dance floors, discos, dance schools. The taxation system used is the simplified tax system (6% of income). Since the individual entrepreneur provides services to the public, a cash register is not needed, it is enough to issue strict reporting forms (BSO).

After registration, you need to choose a room for the school. The room should consist of a main hall, two dressing rooms - separately for men and women, a bathroom, a reception room (reception), a staff room. The hall must be at least 50 sq.m., have a rectangular or square shape and even walls. Thus, the rented premises must be at least 100 sq.m.

Location selection criteria:

City center;
Proximity to transport interchanges, metro stations and bus stops;
Availability of parking.

Wooden flooring (parquet or laminate);
Large mirrors on the surface of two walls;
Good lighting;
Floor mats, water cooler.

A reception desk is installed in the reception area, 3-4 chairs for clients. There are benches and lockers in the locker rooms. The staff room is equipped with a table, chairs, wardrobe. This is a place for teachers to relax.

While you are setting up your work space, you need to start looking for teachers. You can search for them online by browsing the websites of famous dance schools in your city, and then the personal pages of teachers on social networks. You can look for employees at dance forums and festivals, at master classes in areas of interest. However, be prepared for the fact that all experienced and in-demand teachers are already working. You need to not only analyze the market and identify the best dance gurus, but also offer them more favorable terms of cooperation. You will have to use all organizational skills to create a close-knit team of professionals.

After you have formed a staff of workers, you can begin to conduct the first trial lessons, after which you will sell subscriptions and form the first groups of students. In parallel, disseminate information about your school on the Internet and in print format.

6. Organizational structure

To start the work of a dance studio, it will be enough for you to work with 3 teachers in different directions. In addition, to work with clients, you need to hire an administrator. Since the flow of customers will be small at first, the school will fully function only in the evenings on weekdays and during the daytime on weekends.

For the well-coordinated work of the team, you need to write down detailed job descriptions for each employee. Before starting work at the school, each employee must pass an exam on knowledge of their job description, as well as the general rules for interaction between employees within the current organizational structure of the school.

Administrator

Administrator duties include:

The opening of the hall half an hour before the start of the lesson;
Checking the working condition of musical equipment;
Checking the condition of the premises (cleanliness of the hall, availability of additional equipment);
Pre-registration of clients for classes;
Maintaining a client base;
Meeting students, familiarizing everyone with the rules of the dance school;
Sale of subscriptions and acceptance of payment;
Accounting for class attendance, maintaining the rating of teachers;
Drawing up a schedule of classes for each month, taking into account the wishes of clients;
Answering calls, consulting on all school services and work schedule;
Looking for new clients;
Cleaning the room after class
Closing of the dance hall.

Depending on the number of employees in the administrator position, the schedule and rules of the work of your school, the items of the job description will change. However, even before starting work, you must make sure that the applicant for the vacancy is familiar with all the responsibilities, since it is the studio administrator who is the face of your school for each client.

The salary for an administrator consists of a fixed and percentage part (7,000 rubles + 3% of the amount of revenue). The administrator's work schedule also depends on the workload of the studio. As a rule, the administrator works from Mon. by Fri. afternoons and full day Saturdays.

Teacher

Dance instructor responsibilities include:

Timely start of each lesson;
Familiarize students with safety at the beginning of each lesson;
Maintaining order in the hall during the lesson;
Individual approach to each student - control of achievements and consultation on any issue related to classes in this area of dance;
Continuous independent professional development in the chosen area of teaching;
Improving the reputation and expanding the base of regular students.

The teacher's salary depends on the number of students in the group and is determined as follows.

The future is already here. It just hasn't spread widely yet. (c) William Gibson

The choice of promotion strategy largely depends on market conditions and management personnel. In the case of NN Dance Complex, the influencing factors are not only the current situation on the market, but also fashion, the interests of socially active citizens, and the level of income of the population.

Since the dance studio NN Dance Complex is quite young, only a small part of Krasnodar knows about it. Therefore, the strategy in the short term should be aimed at attracting customers, and in the medium and long term, the emphasis should be on retaining existing customers. In this case, it is rational to use two types of advertising - information and image, respectively. Taking into account the conducted studies and analyzes, it follows that it is necessary to focus on marketing activities aimed at mass character, interactivity, involvement. Based on this conclusion, it turns out that the marketing strategy in different periods should achieve the following goals:

1. Long term:

1.1. Become the market leader in Krasnodar in the field of modern pop choreography (70% of the market);

1.2. Open 3 branches in Krasnodar, 1 in Novorossiysk, 1 in Sochi;

1.3. Receive a net profit of each branch of 100,000 rubles;

1.4. Conduct monthly master classes of world-class dancers since 2016.

2. Medium term:

2.1. To occupy 40% of the market share of modern pop choreography in Krasnodar;

2.2. Open 2 branches in Krasnodar, 1 in Novorossiysk;

2.3. Hold quarterly events for the media and celebrities of Krasnodar and adjacent large cities;

2.4. Conduct master classes for world-class dancers in 2016;

2.5. Organize mass image dance events twice a year;

2.6. Become the first socially oriented dance studio in Krasnodar.

3. Short term:

3.1. Arrange stylistically the premises;

3.4. Conduct a series of performances by the GLORIOUS PANDAS children's ensemble in social institutions;

3.5. Find co-marketing partners

3.6. To hold a reporting concert with the fullness of the hall 100%.

As a result of achieving the goals in all periods and the existing pricing policy, the population of Krasnodar and the Krasnodar Territory should form an image of the studio as an elite, expensive studio. There are no dance studios with a similar positioning on the market of the Krasnodar Territory; if we consider the school-studio TODES, then it is perceived as the most famous, but not as an elite one. It is these circumstances that will favorably influence the perception of the NN Dance Complex dance studio in the way it was intended.

An additional factor confirming the correct choice of positioning strategy is the feedback from the NN Dance Complex studios:

Anastasia Knyazeva: My dancing path began in the fifth grade, when my mother sent me to a choreographic school. Since I came to school quite late, compared to the girls who studied from the age of five, it was hard for me at first, but to the surprise of everyone and myself, the progress in my dancing abilities was incredibly fast, in the eighth grade I became a graduate. After going through a choreographic school, with amazing teachers, I began to practice different types of dances (oriental, hip-hop, go-go), but I lacked that organization, professionalism, a twinkle in the eyes of teachers, the zeal of girls, as before. I was not interested, there was no incentive, there were no really worthwhile studios, I was about to enter the university and I decided to leave dancing. Time passed, and I realized more and more that I was missing something, namely dancing. After 2 years, I nevertheless decided to resume training and chose 5 numbers of dance studios on the Internet, called one of them. I am happy that this number turned out to be the dance studio NN Dance Complex. Upon learning that I was engaged in dancing, I was offered to go through a casting in a show ballet, but I understood that there was a rather long break and I needed to get in shape first, in connection with which the decision was made to work out in a regular group. The teacher believed in me already at the first lesson and gave me the opportunity to prove myself in the working group. At first there was a little fear, like all newcomers, but it quickly dissipated. At the lesson, I came to understand that I am in the team in which I want to be. That faith in us in the eyes of the teacher, the friendly atmosphere, professionalism, the energy that came from the girls, the desire to win - all this made me very happy and my eyes shone again. I did not expect to find a decent dance studio in our city. As they say, to be the best, you need to be among the best. I regained interest, stimulus, my body began to remember what it means to dance professionally, I began to get in shape. It’s not enough to get into a professional team, the important thing is the atmosphere in it and the spiritual fire that kindles you at every training session. I will take responsibility to say for all the girls in our group that our common feeling is the feeling of freedom of flight in the dance. We get real pleasure from our studio, training, beloved teacher, who gives us the feeling of that very flight, kindles a fire in our hearts and gives an incentive to move forward rapidly.

Adelina Mirzaeva: At NN Dance Comlex, teachers are able not only to create an excellent atmosphere in the classroom, but also to achieve results from each student. There are actually many reasons to dance in this magical place: the first is that Anastasia Oshchipok helped me to open up in the dance - her smile and sparkle in her eyes made me believe that I could also dance; the second is my irresistible desire to learn how to control my body as if you were not driving around the city, but sailing on the sea; third - we like to have fun and joke, but our classes are the active work of the ballet Femme Fatale. We move a lot, learn to feel each other, count and listen to music, come up with figures, get confused in the legs and, of course, get tired. This is the most pleasant fatigue that a person can get.

Opening a dance school is a real chance for an entrepreneur to organize a profitable and highly profitable project. Initially, a dance studio can be highly specialized or a wide profile - the choice of one or another option depends on the capabilities of the entrepreneur and the demand for the services offered. In order for a business to become profitable and pay back the funds invested in it in the shortest possible time, it is necessary to draw up a competent business plan that reflects all the nuances and strictly adhere to the developed algorithm.

organizational plan

Since at the beginning of the studio's activities there will be few students in it, for work it is enough to hire three employees teaching different types of dances. The school will work in the evenings and weekends, later the schedule will change to a longer one. In order for the work of hired employees to be of high quality, it will be necessary to draw up instructions. Before an employee starts work, he will need to pass an exam on knowledge of his job duties and the general rules established in the studio.

Personnel search

In order for the school to work fully and recruit new clients, you should hire:
1. Administrator.

The administrator's work schedule depends on the workload of the school, and his salary consists of a salary and a certain percentage of the profits received. His duties are:

opening and closing of dance halls; checking the premises and the operability of the equipment;
maintaining a customer database;
enrollment of students;
sale of subscriptions and collection of fees for them;
scheduling classes;
taking calls and looking for new clients.

2. Director (his duties are most often assumed by the business owner, since the position allows you to better understand the features of the business and learn how to competently delegate authority to subordinates).

The leader forms the rules of conduct in the team, coordinates the work of the studio. He:

determines the direction of development of the studio;
develops job descriptions and rules for the work of the school;
controls the quality of work;
distributes wages, bonuses and fines;
introduces additional most demanded specializations into the range of services provided;
recruits a team;
distributes the budget;
contributes to the development of the school and the dissemination of information about it.

3. Teachers. Their responsibilities are:

familiarizing clients with the terms of compliance with safety regulations before the start of each lesson;
conducting lessons;
establishing individual control over each student;
helping students;
independent improvement of the qualification teaching level;
expanding the clientele base.

In order to encourage teachers to search for new students, a special procedure for paying him is introduced. For example, with a group size of up to 10 people, the teacher will receive 300 rubles for each, and with a group of 15 people or more - 500 rubles per hour.

In addition to the above employees, the staff may include a cleaning lady and a security guard. But, their presence is not necessary, since such duties can be performed by hired employees - teachers (they are responsible for the order and cleanliness in the halls) and the administrator.

Marketing plan

In order for a dance studio to become popular and recognizable, you need to choose a sonorous and capacious name for it, as well as create a unique logo. This data is placed on a signboard, business cards, leaflets and any promotional materials.

In addition, the entrepreneur will need to develop a marketing strategy through which the studio will become known and visited. A marketing plan is developed based on the desires of clients attending classes.

What do most students expect from classes and how to satisfy their requests? Eg:

Most people want to keep their bodies in good shape, so it's a good idea to advertise that dance classes are the best alternative to fitness.
Many attend dances to get positive emotions and get rid of the stress experienced in everyday life. To convince clients in advertising, you can indicate that the studio holds meetings-parties where students communicate with each other, relax and get to know each other better.

In order for as many potential customers as possible to learn about the existence of the studio and become interested in it, it is necessary to create accounts in all social networks. These pages contain school news, class schedules, photos from parties and events held, as well as other posts that motivate subscribers to become studio clients.

Instagram, the Vkontakte thematic group and a YouTube channel are best suited for promotion.

The current way to attract students is to distribute flyers, the presentation of which allows you to attend one lesson for free. Also, students and teachers can participate on behalf of the studio in events held in the city - such self-promotion is very effective. To promote the school as quickly as possible, all possible methods should be used at the same time.

Conducting a SWOT analysis

To plan the most promising way of business development and calculate the real capabilities of the enterprise, a marketing tool is used - SWOT analysis.

First of all, the business owner should decide on the target audience:

children - in this case, it is worth organizing lessons in choreography, rhythm, dance gymnastics;
young girls - pole-dance or belly-dance lessons are suitable for them;
male teenagers - break-dance classes are organized for them;
people under the age of 40-45 - social dance classes (for example, Latin American) are organized for them, most of these students come to classes to have fun and communicate, including with the opposite sex.

In addition to determining the main target category, it is required to identify competitors, to study their advantages and disadvantages. Based on these data, a strategy for your own business is drawn up. According to statistics, there are at least 100 dance schools in a city with a million inhabitants. But it is not necessary to consider all of them as competitors, since only schools that teach the same areas or focus on a similar target category are competitors.

A comparative analysis of the market is carried out on the basis of certain criteria by which the client decides to start training in this particular studio. These include:

location - the school should be opened near bus stops, educational institutions, business centers;
class schedule;
events held by the studio - reporting concerts, performances at holidays, participation in competitions, organization of parties, and so on;
The qualifications of the teaching staff is the main factor that influences the choice of a particular school, so only professionals should be hired.

Most students value the social connections that appear in the dance group, which can be identified as an important competitive advantage. Mention in the advertisement about the trusting atmosphere in the studio, the friendly attitude of students and teachers - this will attract customers. Other customer acquisition benefits include:

the possibility of purchasing a subscription to attend a different number of classes;
bonus discounts for regular students;
participation of students in both local and outdoor concerts, performances, events and competitions;
regular parties.

Teachers should not only have documents on their education and advanced training, but also have a good attitude towards students, be able to find an individual approach to each.

Financial plan

So that the dance studio being opened does not become a loss-making enterprise, the entrepreneur should calculate in advance the necessary initial and monthly costs. This business, like any other, needs to be registered - the owner must register with the tax office as a legal entity or individual entrepreneur, choose a taxation system, submit applications to the Pension Fund and the Social Insurance Fund.

As a rule, about 20,000 rubles are spent on paperwork, and the cost of monthly tax deductions will be about 30 thousand.

Selection and rental of premises

To conduct dance classes, you need a well-equipped and spacious room of 235 square meters, consisting of:

bathroom with showers with an area of 15 square meters;
2 locker rooms - 30 sq. m;
pairs of dance classes with a total area of 150 sq m;
staff rooms - 20 sq m;
hall - 20 sq. mm.

Video. How to open a dance school

The average cost of renting a square meter of space is 1 thousand rubles a month, respectively, the monthly rental costs will be 230,000.

In addition, the premises will need to carry out repairs, their cost is about one and a half thousand rubles per square meter. Based on these data, the monthly expenses include rent (230,000 rubles), and repairs worth 345,000 are included in the initial costs.

An entrepreneur can reduce the amount of costs if he finds an already renovated premises. For example, if he rents a place where a similar organization was previously located.

Studio equipment

To equip a dance school, it is necessary to purchase high-quality inventory and equipment. You will definitely need:

mirrors with a height of 2 meters or more - from 160,000 rubles;
air conditioners (2 pieces, one per hall) - 65,000;
plumbing, lockers for locker rooms, hangers - 98,000;
machines for choreography - from 55,000;
furniture (sofas, benches, shelves, interior items) - 130,000;
music centers (2 pieces), a computer (3 pieces - one for the reception and each of the halls), related accessories - from 120,000.

In total, 628 thousand rubles will have to be spent on equipment.

These costs are included in the initial costs. In the future, smaller amounts will be needed - for the repair of equipment, the purchase of office supplies and other trifles.

Other expenses

Among other expenses, one should include a fee for utilities paid together with rent payments and amounting to 10-15 thousand rubles. It is also important, especially at the stage of starting a business, to organize the promotion of the studio correctly and on a large scale, advertising in the media, printing flyers and invitation cards, creating a logo and maintaining groups in social networks will cost 130,000 rubles.

An important item of monthly expenses is the payment of salaries to employees. The final amount varies depending on the number of employees and the workload of the school, and on average the salary of each staff unit is:

20,000 for a cleaner;
25,000 for administrator;
from 35,000 for teachers.

If the studio has 1 cleaner, 1 administrator, 3 teachers, then the minimum salary for the team is 150 thousand rubles per month.

Important! In accordance with this financial plan, the initial costs will amount to 1,123,000, and monthly - 420 thousand rubles.

Calculation of profitability and payback

To find out how much profit a dance studio will bring in a month, it is worth making the following calculations:
in the first month, 110 subscriptions worth 6,000 rubles were sold, respectively, the profit after deducting monthly costs will be 660,000 - 420,000 = 240,000 rubles.

In the following months, the number of subscriptions sold increases, but there may be additional costs for hiring dance teachers in other directions, those that are not yet in this school.

Video. Opening a dance school from scratch

A decline in customer activity is observed during the summer months, as most people prefer to be outdoors or go on vacation, and in January, due to the New Year holidays.

Despite this, a dance studio is one of the most profitable business options, since its payback takes about a year, and the break-even point is already passed in the first month of doing business. The profitability of such a business is high - more than 60%.

A businessman who wants to open a dance studio should draw up a detailed business plan, study the services provided by competitors and develop his own business development strategy. The advantage of this type of activity is that dances are in demand among people of absolutely all ages, which means that you will not have to experience a lack of clients.