Mr. Phuoc Vu is a private music teacher that has been working in the industry for about 15 years. He stated that his determination to always learn and improve, along with his dedicated approach to work and strict ethic allowed him to gather a significant pool of students. Eventually, these traits prompted him to think about opening his own music school and persevere through every struggle on his journey to success. According to Mr. Vu, he began to work on his business-related skills such as management and accounting at the same time to ensure that he was well-equipped for becoming an entrepreneur. During the interview, he described in detail how he took various courses and studied the necessary literature, working almost 24/7 to build the foundation for his knowledge as quickly and efficiently as possible. He is rather dedicated to his craft – music has always been a source of inspiration and joy for him – and he has a strong will to put a lot of effort into his work.
Mr. Vu also discussed a well-known myth about how all successful entrepreneurs had a wealthy family and an existing capital to support their business. Seeing as he comes from a lower class background, he stated that, of course, having money and network to start his school would definitely be helpful. Nevertheless, he still always believed that hard work and tenacity, as well as an educated and strategic approach were more important than any existing capital. Another myth he felt was important to discuss was that entrepreneurs are “born that way,” meaning that some “inherent talent” to do business is crucial for a successful business. He explained that, when he started his career, he never thought about creating a company and no one in his family was a businessman. However, when the idea came to him, Mr. Vu changed his approach to entrepreneurship and developed his own strategies through extensive learning and research. He found that business management, just like any other skill, can be learned and implemented into one’s lifestyle without needing any specific talent for it. This revelation helped him maintain his resolve and supported him in his entrepreneurial journey.
Recognizing Opportunities and Generating Ideas
Mr. Vu stated that he has always been interested in teaching music and wanted to make it as profitable as possible in order to support his family. Initially, he did not thought about opening his own business – instead, he worked first in different schools, both public and private, as well as provided individual lessons for students. He built a good reputation and eventually became a renowned teacher in his city, and thus, 5 years ago, he decided to quit teaching at schools altogether and focus on private lessons. As Mr. Vu began to see that people were rather interested in learning music, and that the demand for experienced and knowledgeable teachers was high, he started thinking about opening his own school. Moreover, some of his students told him that they were interested in group lessons to learn how to play in an orchestra, for example, and some even wanted to make a musical career later in life. Mr. Vu saw this as an opportunity and incentive to start a school – he did not have the place nor all the necessary equipment to fulfill this demand. However, if he had his own company, than he could make it work.
After that, Mr. Vu began to study business management and, as the first step of his strategy, he performed a market research. He cooperated with private research agency to make sure he had a comprehensive analysis of market demands, opportunities, and niches before starting a business. His city was well-known for its musical theaters, live performances, and concerts, while the appropriate and professional courses for musicians were lacking. Thus, Mr. Vu understood that his future business would have a good chance for success on the market. After reviewing what specific demands the students had for musical courses, he adjusted his strategy and approach to fit the target audience’s expectations. For example, he developed an online course for people who preferred working and learning from home or were disabled and could not come to the school in person.
Feasibility Analysis
Mr. Vu had worked together with the research agencies to determine his target audience, marketing strategy, and overall business feasibility. He selected a priority segment for his school: offline and online courses from beginner to professional for various instruments. He also decided to provide group vocal lessons for adults as a secondary segment of business. Mr. Vu conducted a human resource research, looking for experienced music and vocal teachers that could be interested in working at his school. However, he was not able to find suitable tutors for vocal lessons, and the demand for these services was relatively low. Thus, he decided to change this direction into offering guitar and piano intensives that would go for two months instead from standard 6-month courses.
The Business Model and Core Strategies
Mr. Vu chose a standard fee-for-service model for his business, as it was the most convenient and suitable for the music school. He adjusted the model for his primary services slightly to fit his service offers, so it cannot be considered “disruptive.” For example, he offered his potential clients to buy one month of lessons for a reduced fee, and if they were interested in purchasing the full course package by the end of it, he would reimburse the cost of this first month.
Mr. Vu’s main revenue comes from selling his offline and online courses in full packages. The cost structure is the following: the price of equipment, rent for the studio, salaries for 4 teachers including Mr. Vu, utilities costs, hosting and support of website and online services, and part of marketing expenses. To initially finance his business, Mr. Vu has taken a loan from the bank; he was able to repay it after 3 years of running the school.
Industry and Competitor Analysis
The business environment of the city where Mr. Vu decided to open the school could be considered favorable for opening such a start-up. In terms of bargaining power, the school filled a niche where the demand was relatively high, and Mr. Vu made sure to diversify his services to an extent to appeal to a larger audience. His business made a unique value proposition by offering online courses for an initially lower than market fee to attract clients who were not able or willing to attend offline lessons. While the initial costs of renting a studio, buying equipment, and developing website were high, the recurring costs after were significantly lower. Bargaining power of suppliers was relatively high at the start of the venture, as Mr. Vu had to find good equipment for reasonable costs, but he already had a strong network that allowed him to find good offers. Moreover, the competition was limited, as there were only three other schools which also focused more on dancing and theater performance lessons, with music only as a side offer.
At the initial stage of start-up, the threat of new entrants was rather low – that was what prompted Mr. Vu into opening a school in the first place. However, after his school’s successful start, competitors became more interested in this niche, and two of the other dance schools decided to develop their own music courses, as the entry barrier was low. The threat of substitutes was not significant at the start of the business – essentially, only private teachers were active on the market, and the competition focused on other, while similar services. This is also why the competitors’ rivalry was also not important to Mr. Vu at the start – he saw that the niche for specifically musical schools was free. Moreover, his school provided more professional and diverse services than any private teacher.
Marketing Strategies
The target audience for Mr. Vu’s school was the following: people in the age range from 23 to 35, middle-class, working, preferably single or with a partner but childless, with high level of interest in music. Mr. Vu also aimed at disabled and remotely working people who sought to attend different online courses and wanted to gain new skills. To build his brand identity, Mr. Vu used musical narratives and themes, taking inspiration from the city’s most well-known and famous musicals and concerts. By understanding the positioning of competitors, Mr. Vu was able to develop a way to stand out in relation to them and show his unique offers to the consumers.
The most popular digital channels for attracting customers to a music school were the search engine optimization (SEO), social media marketing (SMM), e-mail marketing, and content marketing. Soegoto and Utomo (2019) state that “the role of social media is very influential in increasing economic progress that has a very wide opportunity” (p. 2). In order to develop the best promotion strategy for every product, Mr. Vu had to test different channels and find out which worked best for which offer. The main placements for his business’ marketing became Instagram, Facebook, TikTok, Google search engine, and influencer advertising on music-related YouTube channels.
Critical Factors and Challenges
The key factors for Mr. Vu’s success were the fact that the niche for purely musical schools was free, his own reputation as a teacher, existing pool of interested potential clients, and online courses offer. It is also important to note that the interest for music and performative arts is rather high in the target city which created an already engaged target audience. Mr. Vu’s key strategy for further sustainability is to increase the number of teachers in his school and provide more diversified and flexible course packages in the future. Mr. Vu’s business does not require any specific patents or licenses but he strives to further expand and build his brand equity.
Future Goals and Insights
Currently, Mr. Vu’s main goal is to develop his school into the most renowned one on the market, and affiliate the brand identity with professional music and career opportunities. It is indeed an achievable task as he continues to expand the variety of his courses, especially online ones. In the future, it would be wise for Mr. Vu to continue to develop and diversify the services his school offers, as well as improve the already existing one to ensure sustainability. Morgan et al. (2018) specifically state that only “the systematic analyses of different research approaches and methods in a particular domain can uncover insights for the development of new strategies” (p. 6). Perhaps, he could incorporate other performative arts courses into his school as part of the strategy for continued development.
References
Morgan, N. A., Whitler, K. A., Feng, H., & Chari, S. (2018). Research in marketing strategy. Journal of the Academy of Marketing Science, 47(1), 4–29. Web.
Soegoto, E. S., & Utomo, A. T. (2019). Marketing Strategy Through Social Media. IOP Conference Series: Materials Science and Engineering, 662, 032040. Web.