Did you know that from Washington, DC to Baltimore, MD, over 150,000 acres will be paved over with new construction, infill, and residential and commercial growth by the year 2030? Or that inflation from 1999 to 2006 alone rose over 25%, while the Median Family Income rose about 52%, and more than 39% of residents had incomes exceeding $100,000? These statistics seem to bode well for gallerists who hoped to increase their retail sales.
Less than two years ago, Washington as a whole had more than 49% single person households and less than 14% of households were families with children younger than 18. Detached housing prices rose 165%, town homes 180%, and condos 240%. And if you're wondering if this inflation preceded the recession, or whether there is a recession in gallery sales, consider the upcoming unveiling of the promising National Harbor this April.
The National Harbor alone will have 7,300,000 sqft of mixed use community; 4,000 hotel rooms; 470,000 sqft of convention center; 1,000,000 sqft of retail/restaurant; 2,500 residential units; over 500,000 sqft of class A office space; 4 piers; 2 marinas; and approximately 10,000 parking spaces. Add to that the opening of the Nationals Baseball Stadium and we may well be finding ourselves sitting on the edge of an economic art boom. In Alexandria's Eisenhower Valley alone, there will be an additional 2,500 residential units in the next year.
You and your art patron clients may be keeping a keen eye on rising utilities, property values, labor costs, fuel costs, and changing spending habits, but regardless of these sometimes unpleasant factors in our daily lives, remember the mindset that the Washington DC area art galleries are doing GREAT! BUSINESS IS GOOD and just keep saying it.
Because right around the corner, your potential new customers will consist of locals, visitors to the area, tourists, and conventioneers from the National Harbor. So this is the time to reassess your gallery's market analysis: where's the local buying power; what's the competition and how is it grouped; who is walking through your doors; are there any sales gaps; and have your demographics changed - or how are they likely to change?
It's also the time for DC area art galleries, museums, community organizations, and art non-profits to reassess your storefront's appearance. Does the average shopper see financial stability, store pride, something unique happening, interest in entering the store, and motivation to return? The small details make up the impact of your store's traffic flow and end sales. Check your signage to make sure it's helping to develop a memory, extend the recall of marketing efforts, attract new customers, and maybe alter customary purchase decisions.
Remember the statistics too, in why people shop elsewhere. A better product takes away 15% of your customer base, a cheaper product will also steal away the same. Lack of service and attention will drive away 20%, and your rude or unreliable help may turn away 45%. An art gallery typically will experience 100% penetration in the first 25% of the store's floor space. This is why it's crucial to have good materials, versatility, great lighting, colorful displays, and merchandise in every direct line of sight. There is a science to retail sales which includes studies on retail walking traffic patterns. Do you understand how and why clients are moving through certain areas of your gallery?
Or let's take a look at how the Internet is impacting your end sales. Estimates claim that approximately 82% of consumers will research a product on the Web and 39% won't buy or visit at all if you are without a Web presence.
The bottom line is we must continue to keep an eye on changing economies, loss prevention (80% of shrinkage IS internal), and competition forces. For many gallerists, June is our peak season and although you may not be able to control the foot traffic coming through your doors, you can control what goes on your four walls. Are you maximizing sales and space? Are you selling add-on products like art t-shirts, books, and mugs? What are you doing for the "give" - the complementary thank you take away items you want to use to encourage return visitors?
If your gallery is struggling (and let's face it, we've all experienced crunch times), remember your local Business Development Center may be able to help you at little to no cost. Also, if you're looking to see what the Small Business Administration had to say about the growth of small businesses in 2000, you may want to take a peak at the White House Conference on Small Business. Lastly, we hear from a very reputable source (see below), although we haven't yet read the text, that the international bestseller "Why We Buy" by Paco Underhill has over 30 years of retailing expertise embedded within.
Shauna Lee Lange Arts Advisory monitors and studies many aspects of art business, including economic trends specific to the arts world. We are extremely optimistic about the current climate and always welcome further inquiries or consultations on your gallery needs.
The source for this material is Mr. Casey Willson who has over 35 years experience in retail and tourism related small businesses. He has assisted high-end organizations and diverse companies in attracting and retaining customers and in examining organization and operations. Mr. Willson is currently with the University of Maryland and the Maryland Small Business Development Center. He is noted as a premier speaker in Main Street Development seminars and has presented more than 50 town meetings to over 800 enterprises.
