Danny Brewer knew that the entrepreneurial life was for him when he saw that the address of one of his bosses after college was, literally, “No. 1, Easy Street.”
This was about a decade ago and soon thereafter Danny started his first business: he became a mobile DJ. While that was a good gig (and still is, see below), everything changed when Brewer went to a trade show and saw an opportunity in the photo-booth business. You know what photo booths are – you see them at weddings and other events, where guests can dress up and get their pictures taken.
Before long, Danny Brewer had five photo booths running, giving us the first insight into how to rock the gig economy:
Rule No. 1: Replicate yourself.
One common mistake I see people in the “gig economy” make is that they think too small. They create one gig and stick with it, driving for Uber or whatever.
What Danny did right is that he didn’t fall into that trap. By hiring other gig workers, or even hiring a staff, you ensure that you will not just be creating a job for yourself, but also a business that can scale.
Personally, I have someone who does the tech work for the three websites I run, a podcast producer, a video guru, and an assistant (as they say, if you don’t have an assistant, you are the assistant.)
A few years into his photo booth endeavor, Brewer realized that he had a new challenge. “The market was getting flooded with competition,” he told me. So, instead of competing on price, Brewer again smartly decided to expand; he would run with another idea he had, namely, to manufacture a product.
One of the problems with the photo booth business is that people at the event have to come to the booth and the fun of the booth is limited to that space in the back (or wherever.) Additionally, “our photo booths would lose their ‘energy’ when the band or a DJ would take over the party.”
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So Brewer had an idea for a lightweight, mobile photo system that could move around the party and the Ring Roamer was born.
As Danny’s clever ad says, “Nobody puts Roamer in the Corner.” Which brings us to the second rule for success in the gig economy:
Rule No. 2. Diversify or die.
This is Danny Brewer’s motto. These days he has four businesses, four ways of bringing in money:
• The mobile DJ business
• The photo booth business
• The Ring Roamer
• Corporate team-building events
If you have read my books or this column for any length of time, you know this is one of my mantras as well. Creating multiple profit centers is key.
Danny Brewer’s story is also illustrative for another lesson, namely:
Rule No. 3. Don’t compete on price.
Many bad things happen when you try to be cheaper than everyone else. First, you shrink your margins. It becomes increasingly difficult to make a profit when you make your product or service cheaper and cheaper.
Second, you have to work harder. Because you make less on each sale when you reduce your prices, you need to work that much harder to make what you used to make.
Finally, by competing on price, you are – wittingly or unwittingly – creating a brand based on price and not quality or service or creativity or smarts or whatever. Unless you want to become known as “the low price leader,” competing on price is a loser.
There is a lot of good that can be said about the gig economy, but lots bad too. The trick is to not work for the gig economy but make it work for you.
Steve Strauss is an attorney, popular speaker, and the bestselling author of 17 books, including The Small Business Bible. You can learn more about Steve at MrAllBiz.com, get even more tips at his site TheSelfEmployed, and connect with him on Twitter at @SteveStrauss and on Facebook at TheSelfEmployed.