ORLANDO, FLA. — BrandSource’s CEO Bob Lawrence told members and vendors at its Summit & Expo convention that the group is outperforming the industry in key categories, and to keep that going, independents must embrace new ways of attracting consumers.
Lawrence looked back at 2013 and had some good news for members:
• Audio was up 7 percent for BrandSource, while the industry was down 7 percent.
• Integration sales were up 31 percent for the group, while the industry was up 7 percent.
• Major appliance sales for BrandSource were up 7.2 percent (excluding builder sales), while the industry rose 4.5 percent.
• Furniture sales for BrandSource rose 4.1. percent, with the industry up 0.7 percent, and in bedding. group sales were up 5 percent, the industry 2.1 percent.
As for the TV business. Lawrence said it was “too confusing” to measure how well the group did vs. the industry due to TV’s mix of high-end and low-end largescreen TVs.
The BrandSource CEO told TWICE the group’s total sales are still at the $14 billion level, with CE the largest category now at 45 percent, due to ProSource; 35 percent for major appliances; 25 for furniture; and 5 percent for “other” such as outdoor products.
Back in 2012, major appliances, which are still a big part of the group’s sales, were No. 1.
Lawrence advised members to check out four basic categories at the Expo’s show floor: “Outdoor Source” (the group’s outdoor products effort); mattresses and furniture; 4K TV, which he described as “a huge opportunity” and “The Connected Home.”
In fact, Lawrence told TWICE that the outdoor category “has gotten traction” for the group in the marketplace. And the show floor also featured “LED lighting for the home,” which he expects will be a strong category for his members.
Much of Lawrence’s speech centered on: “Where have we been? Where do we need to go?”
He looked back to a decade ago and mentioned “a collection of things that have disappeared,” such as VCRs, fax machines, dial-up Internet, CDs and the like – technologies that independents either sold or relied upon to run their businesses.
The point of his nostalgic review was that “lots of tools we have used … have gone away. [But] we have embraced technology to increase footprints in [our] stores.”
For instance, “In a connected world, people still want in-store shopping. But surveys show 40 percent of consumers said retailers must increase the in-store experience,” Lawrence said.
He suggested that when members go back to their stores later this week, “go to the front door of your store, close your eyes and open the door. Does it have an updated look?”
Just as importantly, in an era when more consumers go to retailers’ websites before they ever go to a store, Lawrence said, “Make sure the website is what you want it to be. Not that you have to spend a lot of money, but a cheap-looking website tells consumers you have a cheap store. Make sure it is a site that you want to visit. Social media, we can help you with that. The Brand- Source app can help. I hope you all [use] it.”
He noted it is the No. 1 appliance app on the iTunes store and added, “With the BrandSource app at your fingertips with a tablet, it becomes a problem solver … to answer [consumer] questions.”
Lawrence said as part of the web and social-media experience, store reviews are now vital, and he pushed his members to sign up for the Expert Reviews program.
“Based on surveys, 86 percent of consumers call reviews critical” in making a decision on going to a store “with 72 percent trusting them as much as a person.”
Lawrence added, “Eighty-four percent of customers will initiate business with a seller which has a five-star rating,” with 3 percent of new customers being likely to try a store with zero-, one- or two-star ratings.
As part of an education program, Brand- Source will make available online or via DVD topics such as accounting, sales, delivery and service. Eventually there will be about 100 of these 10- or 15-minute videos available to members.
Lawrence quoted a Consumer Electronics Association study saying that retail channels on “the sunrise” part of their development are store-within-a-store, brand stores, specialty stores and pop-up stores that “are ascending.” He placed Brand- Source with the “brand” and “specialty stores” in the survey, vs. those channels that are at “the sunset,” such as “big-box stores … and those that just compete on price. CEA is correct. We have a tremendous opportunity in the next few years.”
Lawrence added, “All of these trends show it has never been a better time to be an independent. We have the tools, can provide the in-store experience to succeed.”
About the show itself, Lawrence told TWICE that the convention drew “20 percent more dealerships here than last year,” but he noted that some members brought less people. “I don’t know if it is the weather, or the economy, but it is a pleasant surprise to see more dealers” represented at the show.
