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Pool and Spa News - August 1992
Full Contact Marketing
by Beth Ellyn
Its become the acid test for specialty retailers: What do you do when a mass merchandiser opens an outlet in your area and begins siphoning off customers from your automotive products store, your paint store or your pool and spa supply firm? Its safe to say you cant ignore the competition. Its also safe to say that this form of competition isnt likely to diminish anytime in the foreseeable future.
So what can you, a pool and spa retailer faced with the arrival in town of a Walmart or Home Depot or costco, do to shore up your business keep customers and pass the test? If youre like the retailers P/SN contacted for this feature, you hit the mass merchants where they aint: with personalized service, superior product selection and untouchable professionalism.
Words to thrive by
The most effective starting place in this competition is your advertising program, say those who've encountered price-cutting competition from mass merchants. You bring customers in by carefully targeting your audience and focusing your message on what your company does that mass merchants dont do.
Take as an example the direct-mail newsletter sent out by Daniel Harrison, owner of Long Island Hot Tubs in Mastic, N.Y. Every other month, he sends a 16-page newsletter to 4,500 customers, offering a veritable smorgasbord of specialized operational tips and practical information about products and services available in the store. The overriding theme, says Harrison, is that Long Island Hot Tubs takes good care of its customers long after it cashes their checks. This is an important distinction." he stresses. "because the mass merchandisers dont personalize their service or take care of the aftermarket.
"Harrison also advertises in local pennysavers, where he hooks potential customers with the line, Call for a free newsletter." The biggest portion of the ad here, he notes, is his corporate logo. "A professional logo is one of the best tools to attract new customers," believes Harrison, who declares getting a professional design was money well spent.
Al Inglin, owner of Aqua Pool Enterprises Ltd. in Richboro. Pa., uses advertising to promote his business, but he indicates that his ads never directly address mass retailers. To do so, he says, would violate his golden rule: "Never compete with mass merchants! "Inglin may not mention them, but he sure challenges them with his direct mail campaign and Yellow Pages ads; he also promotes his business on the backs of grocery-store receipts.
By itself, the direct-mail end of the program entails sending out 10 to 12 mailings a year to more than 9,000 customers within a 10-mile radius of each of his two stores. Its the little things that make the difference in all this, he says. For instance, when current customers move, Inglin takes great pains to attract the business of the new pool owners, sending them a special mailing with a personalized letter if he can find their name in the criss-cross directory." If I educate them and let them know Im looking out for them says Inglin, "they will use us when they need service. Ill even send a technician out to their home for a show and tell if thats what it takes," he declares.
In the search for excellence, every little detail counts , say professionals in the pool/spa business. Telephone manners, for example, can help a retailer impress potential customers in a way most mass merchandisers could never match.
With that distinction in mind, Dainel Harrison, owner of Long Island Hot Tubs in Mastic, N.Y.,created a new customer service service department and gave the employees answering the phone expert training in proper call handling "many customers think we are a giant retailer like Sears because we handle people so professionally over the phone" he says. Harrison alsohires "relativeil expensive" employees to answer the telephone "they are the first interface between my company and client" he says "so don't hire minimim-wage people to answer the telephone".
Along with sale items, Inglins mailings stress educational and practical information again, hitting the mass merchants in support areas where theyre weakest. In January, for instance, his newsletter discusses how to open a pool and outlines changes and renovations that might best be completed in spring so the pool will be ready for summer. In June, it broaches the subject of pool covers, looking forward to the fall. His biggest mailing? February, when Inglin posts an eight-page catalog that includes the companys annual service contract.With Pennsylvania suffering from drought, Inglin also sends his customers an National Spa & Pool Institute brochure on the topic. NSPIs safety brochures made up yet another mailing. "Ill use anything thats available to distinguish myself and the value of what we offer in my customers eyes," concludes Inglin.
Bill Storm, owner of Storms Pool & Spa in Fair Oaks, Calif., takes a similar high-road approach, distributing a newsletter called "Splash Lines that his local NSPI chapter has put together. That newsletter, which is 80 percent editorial includes practical, informative stories written by chapter members about pool and spa issues facing consumers.Educating consumers takes place on the sales floor as Well, says Storm; thats where the battle with mass merchants is really won or lost, where pool and spa professionals win customers and their loyalty with knowledge and personalized attention."Im technically oriented " he notes. That is my major asset. I can recognize each customers problems.
"Customers want to buy from someone who knows what theyre selling, concurs Harrison. When they ask about bubbles, I talk to them about the number of jets divided by force per second," he says. "That way they know instantly that I know what Im talking about." To help his customers care for their pools. Inglin has assembled a library with videos about filters, heaters, water chemistry the works "I loan them to customers so they can understand how to operate the equipment," he says. What this information does, believes Inglin, is create a customer for life.
Plenty to choose
The message behind the direct mailings, the promises of long-term commitment and efforts to educate customers are all hallmarks of a fullservice pool/spa supply company. But theres more to outdistancing mass merchants than personalized, informative attention to customers, say pool and spa retailers: mostly. a bigger and/or better selection of products.
The recession on Long Island has actually helped pool/spa retailers, reports Harrison. "Right now the money is in aftermarket products, heaters, covers and service, not new sales," he explains. "And those are four areas the mass merchandisers around here dont touch at all. "One of the best ways to beat mass merchandisers out on product selection again, hitting them where they aint is by doing a little comparison shopping of your own, says Storm.
Mass merchants tend to have very extensive advertising schedules, he notes. By monitoring them carefully, you can make sure you have similar products available. Then its my job to make the customer perceive my product as a better value and thats possible if the products are close in price."
Another strategy: When Inglin found he could not compete with mass merchandisers on the price of namebrand chemicals, he decided he would create his own line of private-label goods. If his customers now need chlorine, he will sell them his brand."We rarely have any trouble converting a customer to our house brand. Inglin reports. Indeed, since Aqua Pool launched its own chemical line. Inglin says hes lost only five customers who wanted the name brand.
Beyond them, he says, "Our customers trust us. They know we are professionals, so they are willing to try something new if we suggest it". The biggest mistake a retailer can make is to try to match a discounter's price, adds Harrison, who admits to learning that lesson the hard way "Eighteen months ago I entered the price battle to generate sales, but the war completely devastated my botton line, The program was a resounding loser, and I ended up with a negative cash flow,"he reports. "Thats when I decided I would never again cater to the bargain-basement shopper".
Instead, Harrison now focuses on custom work for upper-end clients - a degree of service not found in the mass marketers repertoire. He is also bolstering his bottom line by selling wooden hot tubs "No one else on Long Island carries them, so these customers have to deal with me," he points out.
At your service
Offering your customers services that the mass marketer doesnt even address can also make the difference in where customers choose to do business Being a warranty station, for example, can underscore a stores professional credibility, says Carl Nosal owner of Nosal Pool & Patio in Lansing, Mich. Customers feel comfortable knowing who to call if something breaks during the warranty period.
If customers mention (and they do) that they can buy a spa at Sam's at a discounted price, Harrison points out that he has 13 years of experience in the spa business and tells them. "I you're looking for a special, buy else where. But call me when it breaks." On a daily basis, say many of these retailers, they can offer the service of professional water analysis. Even though he wishes he did no have to perform courtesy water tests Storm recognizes them as significant to sales. Customers are the most scared about water chemistry, so thats where they see they need us the most. They come to us to lean how to care for their pools." Nosal reports that be has the only computerized water analysis lab in his area and that customers come from far and wide to have his computer resolve their chemistry quandaries. "Weve sold a ton of chemicals because of our computer and high-tech image," he says.And once a spa or pool is sold, customers will keep coming back for chemicals if you show them why they should, adds Scott Mueller.
"Most people who have pools and spas dont have a clue how to take care of them" says the owner of Mueller Spas in Santa Ana, Calif "They need advice. My clients like to talk to us about their problems. And they know they cant talk to a clerk at a mass merchandiser. Those clerks only know what section the spa chemicals are in. Our clients need much more help than that, so they seek us out.
Mueller says his customers are even willing to pay a higher price for a product when solid professional advice is bundled into the transaction. "If a customer has a problem, he will pay more to buy just the right chemical to settle his predicament. He doesnt mind the price tag when he knows he is buying the right product for the job."And even though mass merchants often offer lower prices, insist these retailers, it doesnt guarantee them saleseven on cash and carry chemicals. In fact, Inglin has found a successful way to undercut mass merchandisers in the chemical sales market by establishing a two-tier pricing system that rewards customers who buy from him.
One of the biggest springtime revenue generators for this Pennsylvania retailer is pool openings, for which his company customarily charges $260. If the customer Includes a $100 chemical order with the pool opening, however, Inglin will knock $50 off the total price.Customers like both the price break and the convenience of not having to lug 75 pounds of chlorine home. "This has been a very successful marketing program for us," he reports.If a customer chooses to purchase equipment from a discounter, Inglin will be happy to install the product but at a price: A surcharge of $100 is added to the service call. Thats another reasonable, persuasive incentive, he believes, for customers to sign-on with a professional retailer from the get-go