Since the boats are so expensive, their marketing efforts are very targeted. Also, half of their business is repeat customers and many of their new customers come via word of mouth. While they do do some traditional print and digital campaigns, a typical marketing campaign for them looks like a jointly hosted party with a private jet company. They’re a luxury good – I don’t see the fact that their business model is at odds with mass marketing as a challenge to expansion. I DO think that they are very American east-coast focused, and that if they want to reach a wider market they will need to establish service yards on the west coast and internationally, which might be very difficult for them to do from an operations perspective.
Hi Leigha! Boat buyers don’t sign service contracts – they return to Hinckley because it’s easy and part of what they’re buying when they purchase a Hinckley is the service itself.
They are at 100% utilization. Their production backlog is as long as 2 years for some of their models. I don’t know exactly what the exact monetary cost or benefit would be to expand their facility, but I do know that after they were acquired by the new private equity firm, they made a conscious decision to keep their labor and production costs as lean as possible.
Thanks, Steve! They are like a job shop and have a team for each new boat. Those teams are usually working on 2-3 boats at any given time. I want to visit, too!
Great post, Michael! Do you know why Steve Ells chose the burrito above the sandwich, hamburger, salad, or falafel wrap? You clearly lay out why TeX Mex is a good starting point for a fast casual restaurant – there are a finite number of ingredients that go into a burrito, beans and rice are cheap commodity foods, and the fresh items (guac, tortillas, lettuce) are easy to prepare each day. I wonder if there are any other cuisines that could achieve the same level of Chipotle’s success, or if Tex Mex is just particularly well suited.
Great post! I totally agree, among other points, that their front desk “concierge” service differentiates them from other studios. And I also had an “aha” moment regarding your point about their cheaper, street-level spaces. I’ve always wondered how they were able to afford their real estate.
You did not mention this in your post but I feel like you might know the answer: Who on earth are the SoulCycle instructors? I feel like a lot of SoulCycle’s business and operating model could, hypothetically, be imitated. But after attending many non-SoulCycle spinning classes at a combination of over 6 different studios and gyms, I think that one of the greatest differentiators is in their instructors. They cultivate “regulars,” post their playlists on the SoulCycle app, and maintain a slick, high energy banter with their class that definitely strikes me as practiced. Does SoulCycle have a training program for their instructors? Do they poach them from Equinox? Do they have some sort of secret Soul Six Sigma philosophy that every instructor is required to memorize? Is the interview process different than any other spinning studio’s?
Love the post, Janine!
I am very curious about the initial small batch releases. I’ve noticed a ton of variability in the quality of their clothes. Great silk shirts, pilly and short-lived cashmere sweaters. Obviously those are two different SKUs, but I’d be curious to know if their small batch sizes could contribute to what I’ve (albeit anecdotally) observed is inconsistency in the quality of their products.