Valentina Bagala and Rafael Savino held their studio's very first registration at a Subway. "We didn't even have an office," says Bagala, who heads the artistic side of Ascendance Studio in Doral, Florida. "This lady called us over the phone, and we said, 'OK, we can take your registration. Would you mind meeting us at the Subway that's downstairs from our studio?'"
Now, five years later, Ascendance is thriving, with a growing competitive team, a 5,000-square-foot space and 300 students—one of whom is the same dancer who was registered in that Subway. Today, registration mostly happens online, as do many of Ascendance's processes—attendance, billing, e-mail marketing campaigns—thanks to Savino, who heads the studio's marketing, finances and administration. To what do Bagala and Savino credit their impressive growth? Digital advertising. Despite working in an industry where many still rely on old-school methods of operation—manual registration, tuition paid in person by cash or check, fliers handed out in parking lots—they took the plunge to modernize their advertising strategy and found it a game changer for their studio.
Slow, but consistent
Bagala and Savino admit Ascendance got off to a rocky start. They rented space from a fitness studio for three months. "We didn't get the best schedule," says Bagala, who could only rent the space by the hour when it wasn't being used. Still, she managed to amass 25 students. Eventually, she found a small, 550-square-foot space of her own in a shopping center. "I remember for our first classes, we would have people who were supposed to show up but didn't," says Savino. "If we had one student in class, we had to teach to that student. That happened multiple times."
When two more spaces became available in the same shopping center, the couple grabbed them, despite the inconvenience of the units not being connected. "You had to step outside," says Bagala. "It wasn't very comfortable."
"The fliers weren't working."
With more space came more responsibility—to increase enrollment. They had been passing out fliers at nearby schools, but that approach, Savino says, "became unscalable. That's when I started looking at digital advertising." He didn't have much money to spend on it—his budget was $5/day—but he began looking into advertising on Google. He also enrolled in a local digital marketing course at nearby Miami-Dade College. "That gave me strategy," he says.
His most successful venture has been with Google's AdWords. With this advertising strategy, business owners create a search ad. (Search ads appear above Google search results when people look for local services the business offers.) The Ascendance search ad, for example, includes the studio website and phone number, plus: "Dance classes for kids. All ages and styles. Try a free class today." Then, you choose keywords—the words or phrases potential customers might type into their browser—and set a daily budget for how much you'd like to "bid" on each keyword. You're charged only if users click your link. During his first AdWords campaign, Savino often bid less than $1 on keywords like "ballet classes," "hip-hop classes," "jazz" and "dance studio."
How much you bid affects in what order your search ad appears among other businesses. But a business with more money to spend on keywords won't automatically see their ad pop up first. Multiple factors—keyword bidding price, how long a user stays on your website, your click-through rate—determine what's called your quality score. And it's your quality score, ultimately, that decides in what order your ad appears on Google.
"For example, let's say there's a huge competitor who's bidding $10 a keyword, while I'm only bidding $1," says Savino. "Google is tracking everything. If users stay on my website for a while and don't click the back button to get back to the search page, Google knows my website is relevant and a good experience." That increases his quality score and gives his search ad odds a boost.
Savino ran his initial AdWords campaign for about a month in 2013, starting in mid-September—prime back-to-school time. Each week, he wound up getting 10-plus interested customers. He offered each a free trial class. Of that weekly number, more than 80 percent enrolled in classes. By the time the campaign was over, Ascendance had 45 new students. And it all cost him less than $150. Though he risked spending more than his daily allotted $5, he knew it would pay off in increased enrollment.
As they became more comfortable with AdWords, the couple experimented. Bagala asked her mom what words she would use to search if, for example, she were looking for ballet classes for a 5-year-old. Her responses became part of their strategy: "ballet classes in Doral," "dance classes in Doral," "dance studio in Doral." They also interviewed parents of new students, asking 'How did you hear about us?' "If they said, 'Google,'" says Savino, "we'd ask if they remembered what they typed."
Now his daily budget is $20, though he's careful to time campaigns with high-enrollment periods. "During back-to-school season, August and September, I know a lot of people are going to be looking for classes," he says. "But I also know that January is another high-enrollment period—that's when we see an uptick in our baby program. Those moms are operating on a calendar year, not a studio year."
When Google came to town
Last spring, Google itself took an interest in Ascendance, and it featured Savino and Bagala in a national video campaign as a small-business case study. Of particular interest was the studio's dual advertising campaigns: one in English and one in Spanish. Savino and Bagala are bilingual, and their community is largely Spanish-speaking—so they capitalized on that. "Since we were advertising in Spanish," says Savino, "those people were sure that they were going to come through our door and someone would be here who would speak their language."
Of course, digital advertising can only take a studio so far. You have to follow through with a great product—and that, Savino says, is Valentina's greatest contribution to the business. "At the end of the day, if the product isn't good, people are simply going to leave," he says. "She's the heartbeat of the studio."
You've grown up dancing; you can no longer ignore the itch to teach; you've been secretly planning your first recital theme for the past three years—in fact, you're eagerly hatching plans to open your own studio. While your passion for dance and desire to pass on such a beloved artform will be strengths for running a studio, they are by no means sufficient to make it a success. Owning a studio is a commercial venture that requires capital, business savvy and an almost obsessive attention to detail. Here are six risk-reducing strategies to ease into studio ownership.
Make sure your technology works for you, not the other way around.
Today, we didn’t have internet in our office until 3:00 pm. And it felt amazing. My fellow editor kept lamenting that she couldn’t get anything done without it, but I’ve never been more productive. It’s because I’m usually trying to prove to myself that I can do 15 things at once. It’s because of—in a word—e-mail. E-mail is a complete time suck, and studio owners know this just as well as magazine editors.
Today I learned that messages can wait, because sometimes they must. Without the option to answer numerous logistical e-mails, I was free to do an essential (my favorite) part of the job: write. For studio owners, I imagine this is like the times when you get to just teach. It feels great, doesn’t it? It’s important to make real, uninterrupted time for this kind of work, not only so you enjoy it, but so that you do it well.
I asked Cindy Clough, owner of Just Fox Kix—the dancewear company and several successful studios—how she keeps e-mail from taking over her busy life. She has a few tips:
- Overload clients with info. Clough keeps as much current information as possible on her company’s Facebook page and website. “I try to be as detailed as possible in my communications,” she says, “so they don’t have to contact me as much.”
- Send one-way messages. Clough uses an app designed for classroom teachers called Remind. You can send a mass text to a group of contacts, and no one can reply to it directly. In that sense, it functions like an alert: “Due to snowy weather, preschool classes are canceled today.” Boom. Done. If someone really needs to reach you, they can e-mail or call you separately, but it’s not quite as easy as clicking “reply” on the message.
- Manage expectations: Reply less frequently. In addition to running her own studio, Clough coaches a high school dance team. When she took on those extra dancers, she began replying to the students and their parents just once a day instead of immediately or hourly. “I work with a lot of high school dance coaches, and they get bothered [if the internet isn’t working],” she says. “I tell them I coached before the internet. It really does eat up your time. Checking it less often is important.”
There you have it from the veteran businesswoman. If she can manage to take a step back, we all can.
Our Dance Teacher Summit gets started tomorrow afternoon with a special studio owners roundtable before classes and seminars begin on Friday. Here's are some recital ticketing tips from Danie Beck, just to get you excited. Beck owned Dance Unlimited for over 40 years. She and our other ambassadors will be on hand this weekend to share their best business advice.
former owner, Dance Unlimited
Danie Beck has seen her students go on to study dance in college and perform in national Broadway touring companies. A Dance Teacher Summit ambassador for three years, Beck has recently sold Dance Unlimited to a former student.
Dance Teacher: Over the years, you’ve had as many as 500 students performing in just one yearly recital weekend. How do you organize ticketing for such a high-volume event?
Danie Beck: For many years we went through the “waiting in line at 4 am with a lawn chair” routine, so by the time the parents got into the studio, they were so aggravated it was like dealing with a tiger! And when they got to the auditorium for the show, the grandmother would be saving six seats with a sweater, a purse and an umbrella and people got annoyed.
Something had to change. I couldn’t go through this horrific mob scene every year, so we started a lottery for requesting tickets. There’s an open period of about a week when parents can come in, draw lottery numbers and fill out ticket request forms for each show. At first the office would be mobbed on the first day, but people have learned it really is strictly luck of the draw, and it doesn’t matter when they come. They have an equal chance of getting the seats they want whether they arrive on the first hour of the first day, or right at the end.
DT: How do you assign tickets once you have the ticket request forms?
DB: I do it. I can do about one show an evening, going through the ticket forms, filling each request the best I can, starting with the lowest lottery number. It works well, it’s organized and everyone is polite about it. They understand it’s luck of the draw. One year you might draw number 9; the next year you might draw 99.
I also use the lottery to encourage early registration. If you register early, before April, you draw from a lottery bag of 1–50 instead of 1–100. So it’s useful as an in-house tool for registration, as well.
DT: Did you get a lot of pushback from parents when you made that change?
DB: I was lucky that the lottery worked right off the bat. When you make a big change, you have to believe in it, and you have to show that you do. You go in with a positive attitude. “It’s going to be so much better, you’re all going to be happier,” and so on. Then, once you’re made the change, you work with what you’ve created. You can expand it, or if it’s not working the way you’d hoped, you can adjust it, but you don’t need to announce that. You don’t say, “It wasn’t working like I wanted.” Always stay positive, because if people doubt the way you’re thinking, then they’re going to question every move you make. You simply say, “Yes, that worked well, but I think this will work even better.”
Photos from top: courtesy of Break the Floor Productions; courtesy of Dance Unlimited
Today we're featuring DT Summit ambassador Bonnie Schuetz, who has owned Boni's Dance & Performing Arts Studio in The Woodlands and Spring, Texas, for more than 30 years. We spoke to her about keeping her dancers healthy during performance season and asked her to reflect on her first year as an ambassador.
Number of students: 1,600
Dance Teacher: Your company students perform over 12 times per year—at competitions, community shows, recitals and The Nutcracker. How do you make sure that they aren’t overdoing it as they prepare for these performances?
Bonnie Schuetz: We really try not to push our kids. I monitor them as much as possible. During Nutcracker season, I don’t like them to have competition solo or duet rehearsals on weekends. In fact, I don’t allow them at all on Sundays, which is the day of our Nutcracker rehearsals. We want the dancers to have lives, to be kids and teenagers, to go to homecoming, etc. It makes us a much happier family.
And when they are injured, I make sure that they’re not trying to dance. If their doctor’s note says six weeks off, they’re going to be off for six weeks. Their bones are soft, and they’ve got to rest. We’re really careful.
BS: In previous years, I just had so much in my brain that I wanted to share. This year, I was thrilled that I got an opportunity to do that. I’ve been a teacher for over 40 years and had my studio for more than 30, but I still learn something every time I go to the Summit. I think my favorite thing is just to sit around that round table and talk.
DT: What was the main message of the seminar that you ran, “Pre-School Ideas”?
BS: Adding programming for preschoolers can really be the bread and butter of your business. Studio owners love teaching, but they have to remember that it is also a business. For some reason people think that dance teachers aren’t supposed to make any money. Most of us would just do this from the bottom of our hearts—and I did that for years—but we can also be successful businesspeople if we think outside of the box. The best way to make money is to take advantage of your existing clientele. They’re already in your building, so just sell them something else. —Rachel Zar
Photos from top: courtesy of Bonnie Schuetz; by Brenda Bolton, courtesy of Bonnie Schuetz
Donna Aravena has run the Seven Star School of Performing Arts studio with her daughter Nicole since 2002, and she has learned some important lessons in delegating along the way. She has been an ambassador at our Dance Teacher Summit for five years. She spoke to DT about what to consider when hiring a studio’s front desk manager.
Co-owner, Seven Star School of Performing Arts
Dance Teacher: Does every dance studio need a front desk manager?
Donna Aravena: My immediate reaction is yes, because our building has five studios going all the time, seven days a week. I’m a bit of a control freak—I used to be the only one running the front desk, but I’ve realized I can’t do it seven days a week and still do the job effectively.
I chatted with a woman at the DT Summit, though, who doesn’t have a front desk person, and it turns out she is the only teacher at her one-classroom studio. So maybe she doesn’t need a front desk, but she needs to build in time between classes to deal with problems. And there’s still the concern of an emergency happening in the waiting room. I think when she starts growing and teaching more hours, she’s going to want to delegate some of this. It’s very difficult to do all by yourself.
DT: What are the responsibilities of your studio’s front desk manager?
DA: In addition to keeping the lobby clean and dealing with any issues that arise in the waiting area, the front desk manager is the go-to person for all studio information. That person needs to know what each class entails, the dress codes and the calendar of events. All of that info may be on your website, but when clients come up and ask, “Are you closed on Rosh Hashanah?” the answer can’t be, “Well, it’s on the website.” They need to hear, “No, we’re open that day,” from a person they consider to be knowledgeable.
As part of the training, we have our front desk manager do a lot of reading on the studio’s background. We also keep all studio info in a book we call “The Bible,” so the front desk person can access it even if the internet is down.
DT: What qualities do you look for in a front desk manager?
DA: You have to have a compassionate person, someone who can do seven things at one time, from dealing with a clogged toilet to entertaining a child whose parent gets stuck in traffic, all without letting people know you’re flustered. In that sense a mom is a good person, because she is used to multitasking. You want someone who’s going to be self-motivated. If she sees that a shelf needs to be reorganized, she does it and doesn’t need to be told.
Your front desk person is the first person who meets with your clients. You can’t have a grumpy person or someone who’s just putting in hours. You need someone with a passion for children and the arts.
Photos courtesy of Donna Aravena
Understanding cash flow—and some moves to manage it
Joe Naftal grew up in the dance studio business—his parents founded Dance Connection in Long Island, New York, in 1989—and he can still recall his introduction to the term “cash flow” as a child. After exhausting his father’s supply of dollar bills to play an arcade game, Naftal begged him for change. His dad refused, gently explaining that because it was the summer, the dance studio’s cash flow wasn’t as steady as it was during the school year. “I was confused—both of my parents had jobs and worked really hard, so how could the fact that it was summer affect how much money comes in?” remembers Naftal. Now that he is the studio’s marketing director, he understands that cash flow is the lifeblood of a business.
You don’t need an accounting degree to understand how to make your cash flow work for your studio; like most studio business practices, what you need is attention to detail and careful planning for the future. Think of it as fuel for a plane: If you run out, your business will crash—even if you’re showing a healthy profit. With proper attention and tracking, though, cash flow problems can be identified—and handled—before they get out of control.
X! + Y(a2 – b4) = Z2—No, Not So Complicated
Revenue, profit and cash flow are interrelated when it comes to the money generated and spent by a business. Revenue, or the sales created by your business (tuition, administrative and registration fees, recital ticket sales), has an impact on profit, since profit is your revenue total minus expenses (faculty salaries, rent, loan interest and utilities). But generating a profit doesn’t necessarily mean that you always have a lot of cash on hand; cash flow is about timing—the movement of money into or out of a business determines how much cash you have readily available at any given time.
CPA Philip Campbell, author of the book Never Run Out of Cash, recognizes that the overlap of these terms can be confusing. “Small-business owners see on their profit and loss statement that they made $10,000 last month. But then they realize that they have less cash—maybe they started with $20,000, and now they only have $15,000,” Campbell explains. “But there will always be a difference between profit and loss and what happened to the cash.”
This is where cash flow projections come in. By breaking out your estimated cash flow, month by month for the next year (use your previous year’s profit-and-loss statement as a guide), you can see what revenue typically comes in—and when—for your studio. Your expenses will likely not vary too widely, but your revenue (and therefore your cash flow) will. If you’re prepared for potential shortfalls—some lean summer months, for example, when your studio is not in session—you can take advantage of increases during the more lucrative months and plan in detail how you’ll use each payment as it comes in.
Campbell’s method for staying on top of cash flow is surprisingly simple. He encourages small-business owners to be able to answer one question: What happened to the cash last month? “If you can name the three biggest cash transactions and explain why each is necessary to your business’ health or improvement, you’ll be regularly aware of your cash flow,” he says. You also need to think about what you expect the cash balance to be in six months. Growing businesses are particularly vulnerable to cash crises as they increase their expenses or make new investments in their business, well ahead of the expected new revenues coming in. Visit score.org, a website and mentoring resource for small-business owners, to download both a one-year and three-year cash-flow projection template.
Navigating a Cash Crunch
Knowing how to get cash quickly, if you’re in a tight spot, is valuable information, as is knowing how to slow down the outflow in order to tide you over. Here are some possibilities to consider:
Offer a discount for early or in-full payment. You could, for instance, give your clients the opportunity to pay six months of tuition at once, at a discounted rate, or the chance to pay a recital fee several months in advance at a lower rate. “When Dance New Amsterdam needed a sizeable amount of cash in a short amount of time,” says Jamie Posnak, former finance administrator for the New York City dance studio, “we offered our clients what we called an ‘11 for 11’ sale. If they bought 11 classes at once, they could buy them at the much cheaper rate of $11 per class. We knew that would bring in a big chunk of money in just a week or two. We were also mindful, though, that the income would be down over the next three or so months.”
Encourage parents to have payments deducted directly from their bank accounts, via an automatic billing system, to streamline the payment process and establish a steady inflow. A bonus: No need to chase late accounts receivable.
Keep your potentially lean summer months healthy with built-in cash generators, like offering an incentive to register for the following school year’s dance classes at the end-of-year recital. Naftal offered a “Priority Pre-Registration Week” at Dance Connection last April; if students registered then, they received a free T-shirt, $25 off the first month of tuition, 10 percent off a purchase from Dance Connection’s dancewear store and a $5 coupon for summer classes. Naftal saw pre-registration skyrocket as a result. Use the advanced registration and initial tuition revenue to cover standing summer costs like rent and loan interest. Consider holding a weeklong summer intensive for students who don’t want to go the entire summer without dance class—it can create a little bump in summer revenues.
Develop and maintain relationships with your vendors. “Don’t ignore phone calls from vendors if you’re running behind on a payment,” warns Posnak. “They won’t hesitate to cut off your service. But most of the time, they’re willing to work with you.” Posnak found that most vendors would offer her a three-month grace period to make payments, though she needed to be able to guarantee that she could make up the difference over the following three to six months.
Look at your overhead. Cutting expenses, whether temporarily or permanently, is a surefire way to reduce cash outflow. During summer classes, Dance Connection has a consolidated schedule to cut back on the studio’s air-conditioning bill, and the A/C remains off in the studios on days without classes. When Posnak found herself in a cash flow crunch at DNA, she didn’t shy away from slashing expenses where she could—even if that meant not buying office supplies. “When you’re low on cash, you only pay the necessary things,” says Posnak. “You can use scratch paper in the meantime.” DT
The Number You Should Always Know
Every business should have a cash-flow statement that is updated monthly. At the bottom of the statement, below your net cash—cash spent and received for operating, investing and financing activities—is your net change in cash. This number is the total increase or decrease in cash for your business for that period. You always need to know this number; otherwise, you won’t know what action is needed, whether it’s taking steps to speed up cash coming into the business, slowing down cash going out of it or making a timely payment with your cash surplus.
Q: What is the best answer when a parent asks what the registration fee covers? (I know that during advance registration, I can say it holds your spot.) “Administrative costs” sounds vague and doesn’t seem to satisfy them. Suggestions?
A: Many educational programs charge a registration fee to cover the cost of administrative processes. We charge $25 per student for a registration fee; generally, fees might range from $15 to $30 per student. (Some studios offer a “family” limit registration fee of $40–$50 when there are multiple students in one household.) When a parent questions what the fee covers, there is no need to apologize or give a lengthy explanation. Instead, answer with a simple, confident statement like: “This fee helps offset the administrative cost of setting up your student in our studio-class-management system and helps keep your monthly tuition costs lower.” When positioned as something that helps keep tuition lower, a registration fee sounds much more reasonable to parents.
If you’d like to share specifics of what the fee covers, consider answering: “The registration fee covers the costs of paperwork processing and computer time required to set up your student in the attendance and tuition-billing system. It also covers your dancer’s insurance, music license fees and studio communication costs—all separate expenses from class tuition.”
If you want to avoid the question entirely, you could spread the full registration fee across monthly tuition payments, rather than charging a one-time, up-front fee. However, you lose out significantly in the long run, because you cannot recoup the total from those students who only stay in class for a month or two.
Kathy Blake is the owner of Kathy Blake Dance Studios in Amherst, New Hampshire. She and Suzanne Blake Gerety are the co-founders of DanceStudioOwner.com.
Photo by B Hansen Photography, courtesy of Suzanne Blake Gerety