In 2002 Colorado had a devastating drought.
In fact, according to one Hydrologist it was the worst drought in Colorado history. While presenting at a river outfitters conference he explained that Colorado always has a drought somewhere in the state. He contrasted that by showing us a chart of 2002 where every single region within the state experienced drought at the same time. This created the conditions for fires to burn uncontrollably throughout the state to the extent that the Governor went on the air to tell the nation "don't come to Colorado this summer our state is on fire!"
As you can imagine this really hurt the normally robust tourism experienced during the summer. Because of a low to non-existent snow pack, streams were drying up and even the Arkansas River which usually receives supplemental releases from dams upstream, crept along at what would usually be winter flows (barely enough to raft on). Most rafting companies experienced anywhere from a 30-70 percent decrease in business that year with one notable exception!
I had to meet with the owner to find out why when everyone else was going out of business, he had actually remained steady and took over the number 1 slot in market share. So I set up a meeting and interviewed him.
Here is what I found out.
1. Raving fans - The experience that they created was unique and even with low water they made it fun and adventurous. This resulted in guests that were super excited and naturally spread the word to family and friends.
2. Key Customers - They had developed strong relationships over the years with key group leaders. Their emphasis was on the 10% of the people that accounted for 90% of their business.
3. Multiple Income Streams - Instead of relying on raft trip income exclusively, they developed a number of other sources of revenue. This included onsite camping, food service, hiking, climbing, etc. By offering a variety of choices they were less dependent on a single source of revenue.
4. Advanced Commitments - This was probably the most significant take away. 80% of their business was booked 1 year in advance. Brilliant! Instead of waiting and then spending hours sending emails, postcards, calling, etc. They communicated in advance that if they wanted to guarantee a spot for next year the group leader needed to come prepared with a deposit for the next year. This virtually eliminated the issue of fair weather rafters and provided a really solid base for planning. If a group did not renew, they had time to fill it from their database. In this way they always knew in advance how the year would go and it helped them optimize their schedule and staffing.
I hope these ideas stimulate your thinking on how you can drought proof your organization. It certainly did for me. I have actually used what I learned here to begin developing what I am calling a revenue factory. But, I'll need to share more details with you in another article.
If revenue in your organization is not where you would like it to be, I'd be happy to chat with you about ways to improve your position. Feel free to reach out at email@example.com.
Dwight Grant is a seasoned businessman with over 30 years of leadership experience. He lives in CO where he enjoys whitewater rafting, mountain biking and spending time with family.