Wednesday, May 14, 2008

Technical Agencies, Branding & Competition

I was sitting writing about wings and bladders and harnesses and back plates and found my thoughts wandering in a totally different direction. Probably thanks to lunch on Sunday when we had old friends over and started to talk about the good old days. Diving in South Africa started out very much club based (like BSAC in the UK here called SAUU which is now CMAS). When I started way back in 1989 you could count the number of diving schools on one hand…and they were NAUI (no-one had heard of PADI). These days NAUI has taken a back seat to PADI and CMAS/ SAUU has practically disappeared. Sport divers are spoilt for choice and a popular discussion point is how ‘fly by night’ sport schools spring up under-cutting established schools with un-sustainable pricing, ‘steal’ students, provide shoddy training and then go bankrupt six months later. Running a dive school is a tough business and highly competitive. To make matters worse, South Africa tends to be highly price sensitive which means that quality is not often a differentiator when divers pick an instructor or school.
So how does the technical diving market compare ? In sport diving you have an abundance of choice when it comes to agencies, schools and instructors. At last count you could choose from PADI, NAUI, CMAS, SSI/ TDI and recently IANTD. Basically, no matter where you live you should find at least one instructor or school who can teach you how to dive. In technical diving live is not quite so rosy. Back in 1989 the international agencies like IANTD and TDI were not well established. You had to rely on SAUU/ CMAS for technical qualifications and as most instructors were not fulltime, courses were few and far between. The arrival of full time, international agencies seemed to promise change, at the very least it should make technical diving more accessible (like the revolution that was happening within sport diving) .
TDI was the first of the ‘big’ names to arrive on our shores, followed by IANTD. However it soon became clear that the principles of expansion and market penetration that were being applied by agencies like PADI and NAUI were not being applied by TDI and IANTD. Where sport diving grew through the active training and dispersement of instructors (creating a plethora of choice for new divers) technical diving remained closely associate with individuals (for TDI read Steve Minnie and these days Dave Kitchen, for IANTD read Mike Fowler and Don Shirley). Instead of the spread of instructors and technically affiliated or inclined schools that one would expect with the arrival (finally) of South African international franchisees, the landscape looked (and still does) pretty much as it did in 1989 – with agencies being synonymous with the founding instructor and branding seeming to go no further than promoting the franchisee’s reputation and designed to acquire them students rather than promote all agency instructors.
The technical market it seems, is be well and truly ‘locked down’ and controlled by a couple of individuals.
Which made me wonder why the sport and technical diving are so different when it comes to the business and promotion there-of ?After all it is divers we are talking about and technical diving is a natural extension of sport diving which has a huge base.

In sport diving you are inundated with adverts for agencies like PADI and if you phone the agency they tend to promote the closest school to you. In technical diving the opposite holds true. Divers interested in technical diving who do respond to what little advertising there is and phone up a specific agencies are never told about their closest instructor but instead are actively sold the individual behind the brand. Instead of creating a pervasive and accessible technical brand we are left with agencies that appear to be little more than one man shops. Which hardly creates incentive for existing or potential technical instructors. Surely ‘brand’ or agency advertising should promote equally all instructors of that brand and not just one individual ?
What does this mean for technical diving ? Well, firstly the franchisee’s are responsible for training new instructors and so ‘spreading the word’ or getting instructors out there in every major dive centre in South Africa. This makes business sense because the more instructors you have the more students and therefore the more income in a month through package sales and gear (especially if you are also an active gear distributor to that instructor base). Yet even after over ten years when one looks at full time instructors there are only two active full cave instructors in South Africa Don Shirley (the IANTD franchisee) and Gerhard du Preez (co-owner of Liquid Edge Diving). A similar situation exists when you look at Trimix or Rebreather diving where the choice is slightly extended with the introduction of TDI representation (Dave Kitchen, the local franchisee).

This impact of limited choice and penetration on the technical diving community is extensive. With no competition, prices are controlled by individuals. Instead of the pricing policy that is working out there in the sport community where the principle of ‘a small piece of a large pie’ applies (or put another way, you can afford to charge less because you have more divers coming through the door) the technical community appears to operate from a principle of ‘a large slice of a small pie’. As the pie is small prices are high and the effect of high prices is that access is restricted. You end up with a self fulfilling prophecy – with a few full time technical schools competing for a small number of divers and as the numbers are small everyone has to charge high prices. I have to question the base assumption that there are few technical diver wannabe’s out there, not when the sport base is so large.
PADI is not the only success story when it comes to brand penetration, ScubaPro has done a very good job in turn. Here a specific brand has managed to get penetration into the highly competitive equipment market by promoting and actively focusing on their dealers and dealer network. They want people to be selling their product. They want it to be easy for a diver to find and buy their product and as a result Scubapro is one of the top diving gear brands (if not the top) in the industry.
Where am I going with this ? Well Liquid Edge (the diving company I co-own with Gerhard du Preez and the only technically focused full time dive school outside of the franchisees) recently had the opportunity of taking on board NAUI Technical (yes, NAUI offers a full range of technical courses and is one of the only sport branded agencies who does so. No-one was more surprised than I). It was a tough call because based on the fact that we are operating in an artificially created small and ‘elite’ market and we had to ask the question, does South Africa need yet another technical agency ? After all, there is nothing wrong with the standards laid down by TDI or IANTD. After investigating NAUI’s standards and courses I for one felt an immediate affinity. Their instructor cross over was an eye opener with absolutely no slack or concessions given even though Gerhard is a full time technical instructor for both TDI and IANTD. He had to do all the skills, sit in on all the lectures and do all the course work which was certainly not what we were expecting. They also require two pairs of eyes to pass off students, which means you have inbuilt quality control that is not just preached, but practiced (something I have not yet experienced or seen in technical diving). The real sweetner though was the fact that NAUI is looking to actively cultivate technical instructors and get them out there where you as a diver can find them (you try find a technical instructor in Cape Town or Durban, never mind Bloemfontein). All of which can only be good for technical diving. I firmly believe that technical divers should be able to choose from a range of agencies and a range of instructors.

I for one would like to see the day when divers are spoilt for choice when it comes to choosing a technical instructor. When you have a choice you can expand the criteria by which you make your decision, adding aspects like pro-active and visible standards management, quality of training material and C-cards not to mention service and pricing. There is one other big reason I would like technical diving to become more accessible to more divers. It gives you a new toolset that allows you to extend your limits and go and explore new places and I would like all divers to have that opportunity ! I certainly do not regret the journey that technical diving took me on. Oh, and it would mean more support divers (or is that people to braai with J ).