“It’s all about the members,” was the mantra that BrandSource CEO Jim Ristow and his management team kept repeating during a presentation yesterday at Caesars Palace.
Addressing attendees at the buying group’s biannual convention in Las Vegas, Ristow said new BrandSource programs will take advantage of epic changes in the marketplace.
“We have an opportunity that you only get two or three times in a career,” he noted in his opening remarks, emphasizing that with Sears’ major appliance share shrinking; white-goods demand growing; and with increases in the group’s CE and home-furnishings businesses, share and profit gains are there for the taking.
The buying-group chief also highlighted membership gains this year, which he described as the largest ever.
Still, Ristow advised that “we must break from the status quo”; that retail strategies and practices have to change; and that BrandSource is ready to help in the transition and “work quickly to take advantage of these new opportunities.
“It is up to us to give you the tools to succeed” — specifically all manner of digital marketing, as outlined Monday by marketing chief John White.
Ristow reviewed the group’s opportunities in white-goods as an example: Right now 70 percent of U.S. retail appliance sales are controlled by Sears, Home Depot, Lowe’s and Best Buy, but with Sears faltering and the majap market growing 31 percent through 2020, “There is $12 billion in sales up for grabs.”
Speaking of competitors, White told TWICE that the group has heard from more and more people in the industry that “the end is near” for Sears, but that its problems “have made it easier for hhgregg,” due to that chain’s traditional strength in major appliances.
Ristow stressed that retailers who provide “the best in-store and online experience” in any category the group covers will pick up overall sales and unit volume from the all-important millennial demographic.
He told TWICE that traditional TV/appliance dealers must now have websites that are strong research tools and showcases because that reflects on the credibility of the retailer.
BrandSource also has the opportunity in the near future “to pick up Sears’ builder and premium businesses,” he said, but to “really take advantage” and “get millennials” the group needs to improve all facets of its online marketing efforts.
At the same time, changes in the vendor landscape will result in “[market share] shifts in the next 12 to 36 months” that will provide BrandSource members with “a key advantage,” Ristow said.
The recent acquisition of Dacor by Samsung is one such shift, with both executives noting it is no easier buying a premium brand than starting one from scratch. The challenge, Ristow observed, is to “maintain the premium brand” after the acquisition.
“We haven’t seen the last of this type of acquisition,” White added.
Ristow said the same opportunities exist in CE and home furnishings for BrandSource, albeit if member dealers evolve their businesses.
“And we will help you do that,” he told attendees during his address. “The opportunity is there and we can win if we can get consumers into our stores,” with “in-store experience being the key,” as well as interacting with them “on our websites.
“John [White] talked about the digital experiences — social media, mobile, digital marketing, social networks, YouTube — any and all things online.”
He added that BrandSource will eagerly “help you” and focus major resources on digital marketing, and will “work closer with vendor partners” to obtain more support.
Those digital resources include BrandSource Digital Website Platform 3.0, as well as avbTV, announced by White on Monday. Ristow was excited to report that 70 percent of members attending the group’s Stampede buying event signed up for the avbTV program at launch.
And what would a buying group meeting be without a discussion of new members? BrandSource reported the largest membership growth in the history of the organization with two moves: First, by signing 500 new members since the start of the year, encompassing all sizes and “all different types, TV, appliance, CE specialists, rent-to-own and home furnishings,” Ristow said.
It’s not just a “numbers for the sake of numbers” strategy, but that BrandSource wants “a seat at the table,” with national retail power to get “bigger, deeper programs … and work with vendors,” rather than being handed programs.
In a second major move, BrandSource has partnered with the Home Furnishings Association (HFA) to provide buying group benefits to 1,000 of its retail members, so it can be “dominant in home furnishings.”
Ristow said BrandSource wants to be “the gold standard in everything we do,” but preached that while the group is “all about the members” and will provide support, the group needs “to be supported” — meaning that members should select programs offered “that are in your best interest.”