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Posted 20/09/2019 in Coworking Spaces

How To Create a Successful Coworking Business


How To Create a Successful Coworking Business

The coworking industry is booming! Coworking Resources reports that over 2,000 coworking spaces were opened in the second half of 2018 across the world. 

Projections are that the number of coworking spaces in the US alone will reach 6,219 by 2022. GCUC adds to this by projecting that there will be 30,432 coworking spaces, and 5.1 million coworking members, globally by 2022.

The coworking market is huge.

However, coworking business owners will miss opportunities for success if they ignore these tips for creating a successful coworking business.

In fact, Deskmag reports that only 40 percent of coworking spaces are profitable. 

If you want to become a coworking business owner, here are 5 ways that you can be a part of that 40 percent.

Act on the Golden Rule for Coworking Spaces

This point may seem obvious but it is so important that the team at mycowork.space has dubbed it “the golden rule for coworking spaces”. Here it is.

Membership quantity and quality creates successful coworking spaces.

In other words, the amount and type of members a coworking space has ultimately determines the possibility of its success.

Deskmag states that 75 percent of “coworking spaces with 200 or more members are past the break-even point.”

Marketing is pivotal.

Arbitrary marketing campaigns won’t work; there must be a clear plan that turns prospects into repeat customers. 

It is also much more than social media and digital marketing. 

Here are some tips for building a robust marketing strategy for a new coworking space.

  • Know your target audience. Which subsector of the coworking market are you trying to tap into? Do you want to specifically target freelancers and small business owners who work in a popular industry in your area? Your target audience will change as your business grows, but this is a good place to start as the owner of a new coworking space.
     
  • Identify where your target audience likes to be and what they like to do. Opening your coworking space to everyone is a good approach, but you can better meet the needs of your clients if you focus on a target audience. This will mean physically going to these places instead of hiding behind a computer screen depending on the magic of social media. Social media is important, but nothing beats that face-to-face interaction to win a sale.

  •  Identify marketing and networking events that you can attend (and actually network when you go there). Probably you can rent a booth at one of these events to showcase your business.  You could also choose to just be an attendee. Regardless, don’t leave the event unless you have at least 20 contacts that you can add to your mailing and email subscriber list.

  • Email marketing and direct mail marketing are the golden tickets that help you seal the deal. Use these strategies effectively and consistently and you’re bound to have more customers.
     
  • Build a strong digital presence by first creating a website with a well-developed blog. Most people think that entrepreneurs should develop a social media presence first. The truth is that a social media profile complements a strong website, not the other way around. Think about social media marketing after you’ve created a good website to which you can direct followers and build your email subscriber list.

  • Blogging is crucial to driving traffic to your website and showing that you are an authority in the niche. It must be done consistently and utilize the keywords and keyword phrases relevant to your target audience.

Carefully Consider the Demands of Your Area

Coworking spaces won’t work in all areas. 

For instance, a coworking space would fail in a small community because few people living there would need what a coworking space offers.

On the flip side, the possibility of high levels of competition in densely populated urban areas is high.

DeskMag reports that the profitability of coworking spaces dips in cities with 50 or more competitors. Competition is healthy and necessary but too much of it will impact your bottom line. Market research is, therefore, crucial. Here are some questions that you should answer while doing market research:

  1. How many competitors are in the area?
  2. What makes each competitor unique?
  3. How would my coworking space better serve the needs of coworking members?
  4. How close would my coworking space be to the nearest competitor? How can this affect business?
  5. What types of members do my competitors have? Is there a target audience that they have neglected?

Use the Private/Team Office Model

Meeting rooms are great but coworking spaces can earn more from including private and team offices in their design.

A strong coworking space model has enough hot desks to serve members who come occasionally, open spaces for members to mingle, about 2 meeting rooms, and about 3 to 4 private or team office spaces that are rented on a long-term basis.

Some coworking space members value a permanent office space that gives them an official business location without the exorbitant rental fees.

Don’t Do the Sexist Thing

Having a coworking space that limits your target audience to a specific gender is business suicide. 

There should be a balance between the number of male and female members.

The reality is, however, that “men invest more than women in their coworking spaces: in Europe, they invest 2.5 times as much, and in the USA, more than 4 times as much.” Your coworking business will benefit from marketing strategies that attract both male and female coworking members.

Create a Coworking Space Network

Instead of competing against each other, why not forge relationships with some of your competitors? 

There may be amenities that you have that your competitors do not and vice versa. 

A partnership that allows members of both coworking spaces to access these amenities increases the chances of earning more revenue. Think coworking visa.

Leverage these partnerships for business success.

Your Coworking Business Can Succeed

Like any business endeavor, establishing a coworking space will take a lot of work. 

Following the tips outlined in this article will make the hard work worthwhile. 

You can find successful coworking spaces in your area that you can learn from by visiting mycowork.space

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