Not so long ago, our CEO and co-founder, Igor Dzhebyan, took part in the coworking roundtable online conference. The event was aimed at revealing general tendencies in the current changeable coworking market, identifying major development trends and new objectives.
Six speakers working in real estate, flexible offices, property consulting, and coworking community management spheres shared their forecasts, concerns, and insights.
Igor elaborated on digital trends for coworking spaces. As the topic is utterly important now, I decided to translate and publish his report on our blog to make it available for more readers.
Let's start...
The coworking industry is a global phenomenon. Coworking spaces can be found in every country around the globe. The statement can be proved by the geography of Spacebring customers. Our countries of operation are marked with red color on the world map you see below (from South Korea to Europe and the Americas).
As you see, coworking networks in different countries use Spacebring. As we actively communicate with all our clients, it's easy to notice that all of them face similar issues. Coworking brands surely look for the best ways to address those problems which lets us point out certain key trends of the current coworking space business.
Major Trends of Current Workspace Industry
The two biggest coworking trends that can be specified in today's COVID-19 recession environment are the appearance of new target audiences and coworking routines evolution.
Buyer's Persona Development
- Escalation of the key coworking space audience — new client categories arrival (e.g.: big corporations).
- New channels of working with customers. Big corporations are not searching for a workspace on sites like coworker.com.
- Modifications in the coworking space offer structure. Digital membership. Building of powerful coworking space brand.
Sure enough, the above external changes impact the processes inside the coworking communities.
Evolution of Work Processes in Coworking Business
- Data consolidation.
- Digitalization of the work processes.
Now let's talk about each of the above points in detail.
Larger Coworking Market — New Customers Arrival
At the end of the current crisis, given, at least short-term, severe economic uncertainty, I expect new and renewed commitments to coworking space to be dramatically off original forecasts.
~ Alex F. Cohen, a real estate advisor with Compass in New York City
These days we witness the enlargement of key coworking audiences. And COVID-19 crisis even accelerates the trend. New target customer categories appear at the coworking operators' horizons. I am talking about big corporations.
The appearance of new categories of clients forces coworking operators to invent new approaches and involve new channels of working with them. Besides, they need to adjust their offers to cater to new consumers' needs.
I agree with Jonathan Wright (Colliers, Hong Kong) as well as other industry experts who predict that coworking and flexible office industry in 3 - 6 months will fundamentally differ from the picture we see today.
New Channels of Work with Consumers
One more coworking space trend is digital marketing revitalization. Today, when personal contacts are limited due to the coronavirus outbreak online communication comes to the foreground. Word of mouth is not an option to promote a coworking space anymore, time to switch to online marketing strategies that include social media marketing, blog publications, running a website, etc.
Here is a brief list of current coworking operators' concerns:
- New lead generation process (virtual tours instead of physical, self-registration of customers online.)
- High SERP ratings. If customers come from organic search, a coworking website must rank well, otherwise, it won't be found on the net. You need to care about your domain rating, traffic (organic/paid), and other metrics.
- Client path design. A coworking website must lead the user from the first moments on site to conversion.
- Paid acquisition.
- Application of digital analytics tools for making informed decisions (modern coworking businesses are not satisfied with Google Analytics, they use business intelligence tools for better data processing.)
Traditional Pyramid of Coworking Value Added Services
Of course, all movements towards workspace digitalization can't help affecting the product composition of the coworking spaces.
Please look at the image above. Here you see a classical model of coworking services set when the offer starts with workspaces (offices, fixed/hot desks). Though, all of us know that the coworking business is not about workspace rent. A lot of workspaces offer additional essential services (such as lockers, parking, meeting rooms, coffee) as well as non-essential services (chef, concierge, custom office, loyalty program) to increase business margin.
As a result of such a layered approach to rendering coworking services, modern workspaces provide members with online platforms and mobile apps in addition to all listed physical products. These days we observe the transformation of added value pyramid where an online platform becomes a foundation for the entire coworking business model.
In other words, coworking spaces sell their services via an online platform as a more comfortable and efficient way of doing that. Businesses find new creative opportunities to interact with members and retain them by offering anti-crisis services like furniture delivery to help their residents outfit their workplace at home during the isolation period. Under such circumstances, the online platform is requisite to inform members about your cool services.
Generate recurring revenue and offer exceptional customer experience at your shared or coworking space
Digital Membership or Virtual Office Evolution
We're really focusing on a push to build digital community.
~ Noelle Tassey, Alley New York
Digital membership is one of the vivid examples of the new services offered by coworking spaces. From our customers' experience, we see this trend as an evolution of virtual membership. That is, as a new level of membership, customers can purchase or access the digital ecosystem of the coworking space where they find additional services featured above, which have become even more qualitative and wholesome, like an updated loyalty program, awesome outsourced services, or useful things delivery for example.
Coworking operators invest in digital trends because they see them as additional income streams that will stay valid after the outbreak as well.
Educational Content
One more interesting trend related to product composition structure is investing in educational content. A lot of our customers became very active in the field. They generate fun and educational content, i.e.: record podcasts, shoot videos, carry out interviews with residents, run streams and blogs, SNS. This is a smart move as content marketing helps to promote and market their coworking spaces.
Loyalty Program
A loyalty program is one more great example. This is one of the multiple services a coworking space can provide only online via an app or a platform.
Just a couple of benefits that can be included in a coworking loyalty program:
- Partners network. As a rule, coworking spaces have a lot of partners that offer various services with discounts for members. A workspace features all the partners onsite and allows members to easily apply for benefits using a coworking space app.
Loyalty programs make members feel that they get additional value from their memberships, that's why it's utterly important to properly implement them.
Strong Online Brand Presence
When coworking invests in additional services and online platforms, branding is not a less important spot.
Branded items should be used consistently, at every touchpoint with customers. This way you are building trust to your brand. When credibility is established, your branded items start to stir positive emotions especially when your brand values coincide with customers' worldview. Every time a customer sees your logo they recollect your brand, your services which helps to remember it.
External Coworking Industry Changes Trigger Internal Modifications
External changes in the coworking industry trigger the evolution of the internal processes. In the first turn, these days we observe all channels and data consolidation.
Here is how common coworking routines were carried out before:
- Customer support. Has been performed via different messengers (Telegram, WhatsApp.)
- Communication with customers. Performed via Slack, Facebook, and others.
- Additional services were available on site.
- Bookings were done through Google Calendar.
It was more or less ok before the Covid-19 crisis. However, today prominent coworking brands tend to digitalize most of the processes. They create a uniform platform allowing to bond all services in one offer and minimize members' contacts with community managers which leads to optimization and increased efficiency.
Below you can see how one of our customers (WorkQ) consolidates data with the help of Spacebring coworking app. Instead of having multiple communication channels most of which don't provide quality possibilities for branding, coworking invests in the creation of a unified branded channel enabling residents to access reservations, additional services, communication, customer support, cloud printing, cloud door unlock, and more in one place.
This approach is very user-oriented. It entirely eliminates the main problem of coworking spaces when residents don't know about all perks of their memberships. It's very difficult to familiarize members with all services especially if you want to do it at the right moment.
However, when you have a unified online platform, you can fine-tune it to send members push notifications addressing their urgent needs.
For instance, like the one from Uber Eats asking at 6 p.m. "Are you hungry?"
You can do the same at your coworking space and offer members some awesome service at a certain time. This will help to nurture members' trust to your brand and prolong their LTV.
Digitalization of Coworking Processes and Customer's Path Design
I have already mentioned at the beginning of this article that due to overall digitalization client's path at the coworking space has changed and now you need to lead a person through the whole online process of sign up to onboarding and software adoption. The customer experience at your coworking depends on how well you'll manage to design this way of discovering and using your services.
The first step of a member at your coworking space is onboarding. You need to make it as enjoyable and stress-free as possible as this is the client's first impression of your brand. A good practice is to let clients register in your web app and get access to the next level which can include customer support, automatic doors unlock, cloud printing, secure private WiFi, etc.
All these features become available after registration on the online platform. All of them are connected and synchronized. This saves a lot of resident's time, minimizes their contacts with the community manager, and makes all services accessible remotely.
Why Is It Timely Now
As we communicate with many coworking operators, experts, and influencers from all over the world, most of them agree that the coworking industry is going to experience rapid growth after the crisis.
The current recession is a new opportunity to rebuild outdated systems and consolidate all services in one online platform. Coworking centers are likely to play a crucial role in economic recovery.
Coworking hubs are oriented at middle-size and small businesses at the first turn. That's why their community spirit, support, and collaboration is exactly what will help tenants to put their businesses back on track.
Coworking spaces perform their social role, they have their missions which will facilitate the new economical boost of businesses impacted by the coronavirus crisis.
Coworking industry should emerge from the COVID-19 crisis not only stronger but also more important and necessary.
~ Forbes
