Cost-Effective Ideas to Grow Your Lesson Operation

At The 2019 NAMM Show, Richard Berkman of Big Music in Sydney, Australia, shared a surprising transformation: In two years, his company’s music lesson program went from being a marginal and dwindling enterprise to the most profitable part of his business.

Berkman described Big Music’s vision to provide a place to buy an instrument, learn how to play it and have opportunities to play. He and his team designed the organization to reflect that. Berkman noted that their first-floor retail shop has always been a strong source of referrals for the lesson business. They make sure to ask for email addresses of everyone who shops in the store and start promoting lessons immediately.

Upstairs is the Big Music School—16 studios for private and small-group lessons, a recording studio, four band rehearsal rooms and a live music venue for performances that can seat 150. Berkman warned that a big facility doesn’t necessarily mean a healthy business, though. Case in point:

Big Music’s Lessons Business Two Years Ago
• 700 students
• No growth for several years
• Six-plus admin staff
• Mostly private lessons
• Retention issues with teachers and students
• Only marginally profitable
• Losing money during school holidays

The lesson program’s turnaround has resulted in education overtaking retail sales, and Berkman commented that they’ll likely end up with more than 900 students after a heavy recruitment period.

Big Music’s Lesson Program Today
• More than 800 regular students
• Sold-out holiday camps
• Thriving band/performance program
• Most profitable part of the business
• Making a big difference in the community
• Winning awards
• The main focus of their growth plans

8 Steps That Turned It Around
1. Understanding customers. Berkman and his team took the time to study this in greater depth. Half of his students turned out to be less than 12 years old. (Among the other half, 30 percent were teenagers and 20 percent adults.) It was split 50/50 girls and boys, and moms were the big decision-makers. According to Berkman, parents often viewed music lessons as “child care”—and especially important during school holidays.

2. Reinventing our holiday camps. These became more inclusive and available to any child regardless of his or her musical experience. Holiday camps were offered in two streams. For the Ultimate Rock Experience, kids ages 6–11 learned six instruments every day in rotation in small groups of up to seven. For Rock Shows, older kids could play, rehearse and put on a show as a band. Now, up to 70 kids participate in these camps during school holidays.

3. Targeted digital marketing. Big Music’s team created promotional videos and a website for their holiday camps. They also launched basic Google AdWords campaigns and focused on search engine optimization, targeting keywords they hadn’t used before, such as “kids holiday activities,” “kids music camps” and “school holiday activities.” Ads were amped up before the school holidays. Plus, Facebook marketing campaigns became specifically targeted at parents with kids under the age of 12 within a 20-kilometer radius of the school.

4. Building relationships with local schools. Big Music’s team put together a database of every primary school in the district. There were 50 schools, and Big Music had relationships with 10–15 of them. So, they focused on getting to know contacts at the other schools. Berkman mentioned that the resulting database is now one of their biggest assets. “If you haven’t done this in your community or your area, I highly recommend it,” he said. “It’s been so valuable to us.”

Instead of trying to sell the schools, they offered to help with fundraising. They created a gift certificate for a holiday music camp to auction off at a fundraiser. Every single school said “yes.” Big Music also gave the schools marketing materials and asked them to advertise or insert fliers in school newsletters. (This posed no conflict since Big Music was promoting a holiday camp.) Big Music also offered an early bird special coupon, which enabled them to track the responses from thousands of fliers. The promotion with the schools initially increased holiday camp enrollment by 60 percent and doubled enrollment from one year to the next—all from a marketing initiative that cost very little.

Camp kids were then given a free guitar if they signed up for 20 weeks of lessons, and a supplier provided the guitars as a sponsorship. Big Music ended up converting 30 percent of the kids to ongoing lessons and realized 12-percent growth in total revenue in 2017. Holiday camps have now become the top recruitment tool for lessons. Berkman noted that “child care” was driving the initial interest of parents, but the kids wanted to be students for life, which converted the parents.

5. Player Evolution progression system. Big Music offered a curriculum with books but needed some way of measuring progress. So, they developed their own levels based on skills and criteria that they communicate to students and parents. Player Evolution is a grading system that doesn’t involve exams. It helps kids set clear but attainable goals. According to Berkman, Level 4 is the key to this system because that’s when kids can join a band. The entire focus is to get kids from Level 1 to Level 4 and keep them committed. The biggest dropout rate happens at Level 3 because playing becomes more difficult. So, they put development programs, such as a boot camp, in place to get these at-risk kids up to Level 4.

6. The Big Music Bandits. Big Music created Bandits for the most accomplished kids under 18 years of age, and there are now two groups of Bandits. Two hundred kids auditioned for 40 spots in the Bandits program. They play on big stages at festivals and support touring musicians and top artists. Everything is photographed, filmed and shared on social media. The Bandits also mentor young kids. Bandits participants designed their T-shirts/uniforms and want to wear them, so it’s great brand advertising.

7. Higher student-to-teacher ratio. Big Music introduced new group programs and aimed to improve the student-to-teacher ratio for existing programs. Examples:

• Group classes: seven students (1:7 ratio)
• Rock shows: 20 with two coaches (1:10 ratio)
• Rock bands: 1:4 or 1:5 ratio
• Bandits: 2 groups of 15–20 kids (1:15/20 ratio)
• Kinderbeat: pre-school classes (1:8 ratio)
• Women’s rock choir: 1:30 ratio

Also, teacher wages as a percentage of total revenue decreased from 40 to 35 percent.

8. Streamlined operations. Berkman noted that payment is due on the day of the lesson, and it’s automated. “I can’t tell you how many problems that solved for us,” he said. Big Music’s system debits a bank account or credit card on the day of the lesson. (People have until 11 a.m. to early cancel and not pay). No major issues have arisen from this.

Big Music also has an online portal for account admin, bookings, early cancellations and so forth. Plus, it offers online enrollment for holiday camps and automated text and email session reminders. This has enabled admin staff to be reduced from six to three people—and current staff is handling the programs comfortably.