Many would argue that starting a business in these tough economic times is not the least bit prudent, especially a business characterized by low inventory turnover and very high elasticity of demand. In the short term, one would not expect a high return on investment from such a business, but with a well-defined long-term strategy, starting any business now is not a bad idea. First of all, many companies that have been around for at least five years are on the verge of bankruptcy. Its fixed assets outweigh its current decline in demand and its debt-to-equity ratios are high. It means less competition. Second, when the economy begins to recover, your startup will be well-positioned to ride the tidal wave with little or no debt and built “strong, nimble, and mean.”
Art may not be as easy to sell now, but that’s not necessarily the case in a better economic environment. Let’s examine consumer spending patterns on art in Canada.
o Canadian consumers spent $22.8 billion on cultural goods and services in 2003, more than spending on tobacco, alcohol and gambling combined.
o The $22.8 billion in consumer spending is three times more than government spending on culture in Canada.
o Culture is a growing market: Consumer spending on cultural goods and services grew by 36% between 1997 and 2003, well above inflation (14%) and population growth (6%).
o Canadians spent $1.2 billion on books (excluding textbooks) in 2003, 34% more than in 1997 (unadjusted for inflation).
o Live performing arts spending was $980 million in 2003, an increase of 31% from 1997.
o Canadians spent $530 million on artwork, carvings and vases in 2003, 48% more than in 1997.
o Consumer spending on tickets to museums and heritage sites totaled $410 million in 2003, 23% more than in 1997.
o By comparison, consumer spending on live sporting events was $530 million in 2003.
o 49% of Canadian households spent some money on books (excluding school books) in 2003.
o 37% of households spent money on live performing arts.
o 11% of households spent money on artwork, carvings, and vases.
People spend on art. People are likely to trust local artists if they have a choice and the total cost is affordable. Culture and art are growing in Canada. The trend is likely to increase despite the current economic slowdown.
Winnipeg Demography
I cannot stress enough that demographics are the key variable in any marketing effort. It’s no coincidence that many companies spend fortunes conducting primary demographic research before developing a new business segment or entering a new market. Art is especially sensitive to demographic segmentation. Therefore, knowing your customer is key to your success. Let’s examine the demographics of Winnipeg to substantiate the above points.
1. According to the 2006 Census, there were 633,451 people residing in Winnipeg and a total of 694,668 people in the Winnipeg Census Metropolitan Area on May 16, 2006, and 711,455 in the Winnipeg Capital Region, which which makes it the largest city in Manitoba and the eighth largest CMA. in Canada.
2. Of the city’s population, 48.3% were men and 51.7% women. 24.3% were 19 years old or younger, people between 20 and 39 years old represented 27.4% and those between 40 and 64 years old 34.0% of the population.
3. The average age of a Winnipegger in May 2006 was 38.7 years old, compared to an average of 39.5 for Canada as a whole.
4. Between the 2001 and 2006 censuses, Winnipeg’s population increased by 2.2%, compared to an average of 2.6% for Manitoba and 5.4% for Canada. The population density of the city of Winnipeg averaged 1,365.2 people per square kilometer, compared to Manitoba’s average of 3.5.
5. The population of the City of Winnipeg is estimated at 672,300 as of July 1, 2009 and that of the Census Metropolitan Area at 739,300.
understand psychographics
Psychographics or lifestyle analysis is essentially the analysis of a person’s daily life pattern. Psychographics are usually expressed as activities, interests, and opinions. A detailed lifestyle analysis is likely to help startups in a number of ways. First of all, the analysis will help to plan an effective marketing strategy. Second, understanding lifestyle patterns will help develop good advertising themes and web content. Third, lifestyle analysis helps designers further improve interior and exterior designs.
There is a need to critically understand people’s spending patterns, especially in art and culture, how they can be facilitated by an improved online shopping experience that not only connects them with local artists but also provides many useful services.
behaviors
To effectively tap into the seller-side target market, a thorough behavioral analysis must be performed. There is a need to study the needs, perceptions, attitudes and other psychological variables that can influence artists and art houses. The following factors have a profound impact on many artists who would like to adopt an online business model.
1. Inability to learn website development techniques or manage internet-based portfolios.
2. Total dependence on traditional ways of doing business and advertising.
3. Attitude, values and perception about online business.
Part of a viable strategy is informing and persuading customers about the company’s offerings. However, a behavioral problem arises if consumers have inaccurate beliefs or resist change.
conclusion
The string of events taking place puts additional pressure on local artists and creative boutiques to keep up with the overhead of the business. On the other hand, consumers are looking for low-cost solutions but are less willing to leave their homes to go shopping. Consumers are showing great interest in shopping online to save costs. Since the global customer shows great interest in buying products and services online, there is a business niche in this market. It is necessary to think of ‘an electronic store that only connects artists with consumers’. There is also a need to educate entrepreneurs on how to increase the reach of their businesses beyond the ‘traditional brick and mortar establishments’. That’s where your business could fit into the picture.