A year ago, owners and general managers from some 30 home improvement companies gathered in Rosemont, Ill., for a weekend seminar about in-store retailing. The program, presented by the owners of EuroTech, a Chicago-area replacement company, focused on how to set up, manage, and maintain an in-store marketing program with well-known retailer Kmart. Some of the largest regional home improvement contractors in the United States attended.
Home improvement contractors are no strangers to in-store marketing. Some have been drumming up business in retail environments for years, mostly as a secondary lead source. Many, on the other hand, have avoided “affinity” or sell/furnish/install (SFI) programs. Some feel store commissions or fees are too high. Others fear dependence on an unreliable lead source, mindful of those who've been unceremoniously cast out when chains took on new management. “These guys change CEOs like you and I change our underwear,” notes one window and sunroom company president, explaining his caution regarding SFI.
But these days, with telemarketing on the wane and media lead sources both expensive and chancy, many replacement companies are taking a second, “and very serious, look at in-store marketing. “It's becoming a little more mainstream,” says Fred Finn, EuroTech's president and co-owner. “We're all out there trying to get leads, as opposed to waiting for the phone to ring.”
That's true at Pacesetter, too. Once dependent on cold calling for 90% or more of its leads, the Omaha, Neb.–based company, one of the largest in the industry, has downsized its phone room operation and negotiated in-store marketing agreements, putting its demonstrators into more than 200 units of Sam's Club, Kmart, and Garden Ridge.
Credibility Factor So what's in-store marketing got that other lead sources don't? First off, consistency in the lead flow. Companies that relied on telemarketing like SFI because, unlike media, it produces a predictable number of inquiries in a set time frame. Need 18 leads for your reps to run next Friday? Multiply the number of in-store demonstrators by the number of inquiries they're required to produce in a shift. Production may go up or down 10%, but not more than that if good management systems are in place.
That translates to stability. “The easiest way to describe it,” Finn says, “is that it's face-to-face telemarketing.”
A second advantage is trust, something that telemarketing and canvassing can't quite conjure. A nationally known retailer's seal of approval buys big-time credibility.
“I think there's a certain trust that people have,” says Todd Schulz, co-owner of Weather-Tight Corp., a Milwaukee-area replacement company. “If you're in an Ace Hardware, Sam's, Costco, or BJ's, you gotta be good. Those companies have to have done their homework, or you wouldn't be there.” That makes the in-store lead “extremely high quality,” Schulz notes.
Another advantage is that unlike canvassing, which isn't usually done in inclement weather, or home shows, which don't happen all year long, in-store marketers can work 12 months a year. Statewide, a home improvement company with branches in Washington, Oregon, and in Boston, Mass., generates a healthy portion of its business from shows and events. “But you can only go to shows when you have them,” director of operations Vaughn McCourt points out. “In November and December, there aren't a lot of shows. But the in-store demonstrators are there every day and every month of the year.”
Others concur. Stanley Statkiewicz, co-owner and CFO of EuroTech, which divides its in-store marketing between five Sam's Clubs and eight Kmarts, notes that where most Chicago home improvement companies slow down in the winter months, “we write as much business in November, December, and January as we would in March, April, and May,” because the company's demonstrators are working retail stores at the height of the Christmas shopping season.