The leadership of Associated Volume Buyers (AVB) pulled out all the stops to rally member dealers around the Brand Source flag during last month's annual convention and buy fair here.
Citing significant consumer awareness of the two-year-old national branding campaign, the $4 billion buying group hammered home the message that Brand Source represents the independents' best weapon in winning back share from rapacious national chains.
Indeed, the theme of the show, "Vision Becomes Reality," was designed to underscore the strides that the Brand Source banner has made since it was first conceived four years ago.
Some 92 percent of AVB's 1,800 member dealers have since joined the Brand Source bandwagon, although only about half of those have committed to exterior Brand Source signage. Upping that level, said executive director Bob Lawrence, represents a key challenge for the group.
"We're asking you to give up some local autonomy to create a national awareness," he exhorted dealers.
That awareness, built from network television commercials, syndicated TV game show sponsorships and tabloid/insert programs, is considerable. According to Lawrence, 15 percent of consumers cited Brand Source as the place they would go if they were to buy an appliance within the next six months, behind only Sears (64 percent), Best Buy (35 percent) and Lowe's (24 percent).
In addition, AVB's e-tail site, BrandSource.com, is second only to Sears in online sales of major appliances, with $3 million in annual volume vs. $5 million for Sears.com, Lawrence said.
What's more, Brand Source ranked fifth in unaided brand awareness in CE — traditionally the weakest category for independents — trailing only Best Buy, Circuit City, Wal-Mart and Sears.
AVB plans to press its advantage by increasing its media exposure in 2003, with the goal of growing the number of Brand Source impressions 25 percent to nearly half a billion among its target female demographic, and to almost 2.5 billion among all adults over 18.
"This will drive even more customers to your store," Lawrence told the membership. "Now you must tie your store to Brand Source to take advantage of these customers."
To help spur the transition, AVB has launched an exterior signage co-op program that will subsidize half the cost of a sign up to $2,500.
Dealers were also encouraged by a rousing Star Wars parody that kicked off the convention. The filmed segment showed Brand Source X-wing fighters attacking and ultimately destroying a Death Star bearing the Lowe's, Home Depot, Best Buy and Circuit City logos, as an ethereal voiceover whispered "Use the Source."
Among other AVB initiatives announced at the show:
- A partnership with the True Value hardware dealer co-op that includes a turnkey outdoor grill program and a test of renting room in True Value distribution centers and trucks;
- A new ExpertCare insurance program that leverages the group's size to provide competitive major medical, vision, dental, life and AD&D insurance for dealer employees;
- A turnkey CE program with leased modular displays designed to make electronics retailing "a no brainer," according to AVB's electronics general manager Jim Ristow.
- Expansion of the Appliance Gallery program, in which products are grouped by manufacturer rather than category. Participating dealers are showing a 20 percent to 30 percent month-over-month gain following their conversions.
Lawrence reported that despite some upward and downward spikes, AVB's overall business has been good and sales are up, buoyed in part by "a lot of no-interest promotions." Showing particular strength this summer was the refrigeration, laundry, projection TV and DVD categories, he said.
Looking ahead, Lawrence expects "more of the same" for the balance of the third quarter, and sees "no indication that the fourth quarter won't be better than last year."