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Retail David Does What Goliath Can’t

Dec 16, 2007  •  Post A Comment

You know the names: Best Buy, Circuit City, Sears, Target, Wal-Mart. All of these big-box retailers are blitzing the television airwaves with messages of holiday savings on new consumer electronics. They also prove that a high gross rating point level of television creates immediate sales impact.
For local retailers, competing against these national organizations that spend significantly more in television and also take financial risks can seem daunting. Gaining market share can appear to be very difficult. After all, do these big-box retailers leave any business leftovers for the smaller guy?
So how could a local electronics chain possibly survive against such intimidating competition? And is it worth even trying?
In our consulting firm, we meet retailers that not only compete but prosper in the face of major national players. These retailers do it by providing the consumer with a better buying experience, all while offering great prices. These local players win against the odds thanks to their retail smarts, not their size. They need to perform perfectly in all elements of their business, including merchandising, pricing, training, display, management and advertising, to succeed.
One of these proven winners is Queen City Appliances in Charlotte, N.C. Chip Player is president and the brains behind the incredible success of this 15-store regional electronics chain.
We recently caught up with Mr. Player to ask him how he wins with his own brand of television and Web marketing … and how he wins against such formidable national foes.
TelevisionWeek: Tell us, Chip, what it means to be an “independent” retailer and how your customers react to this independence.
Chip Player: We believe it gives our customers peace of mind. Buying audio, video and appliances from people who were born here and who have lived and worked here for many years is a unique aspect of our business. Customers who purchase from Queen City are also directly affecting the local economy by keeping money in our communities. Because we are a locally owned and family-run business, we see our customers everywhere—at the grocery store, at church, at the mall, wherever. Many of our customers are second- and third-generation buyers from Queen City Appliance. We’re able to keep up with their lives, find out about their job promotions, see their kids grow up, meet their grandkids. It’s rewarding to be able to think of them as our friends, neighbors and Queen City family. You can’t get that from the big-box stores.
TVWeek: How has television helped Queen City not only to survive but prosper?
Mr. Player: Because of the decline in newspaper print ad circulation, our television messages have helped Queen City build needed brand awareness in our markets. It has also given us the opportunity to reach new and younger customers. Our television ads tell the Queen City story of low prices, customer service and that we are a local-owned company, which has family appeal.
TVWeek: How is Queen City performing in comparison to the big-box competition?
Mr. Player: Since Queen City is a member of a very large national buying group, our products are priced comparable [to] or below the same products at the big-box stores, which means that we can offer a $100 price guarantee: We will meet or beat any other competitor’s price or give you $100. We have extremely knowledgeable product specialists in all 15 of our stores, many with 10-plus years of experience working at Queen City. We also offer unparalleled customer service after the sale. All of these things combine to give us an extremely strong presence and make us a very successful competitor in our markets.
TVWeek: What do you expect your television marketing plan to achieve, and has it accomplished this goal?
Mr. Player: Of course it has. TV is primarily about getting customers into our stores. But it’s also about conveying all of the points I stated earlier and to let people know that our family-owned local business offers a huge variety of top-of-the-line products that are priced to compete on any level. And that we have been doing that for 55 years.
TVWeek: If you knew of a business owner considering television marketing, would you suggest it?
Mr. Player: That’s a no-brainer decision. TV has clearly made us a dominant force in our market.
Remember that not all consumers want to shop mega-stores. They can be inconvenient in that parking can be a challenge, service can be spotty and prices are not much lower—if even lower at all.
Other niche retailers such as Ace Hardware have found that the big-box stores often send a majority of their customers right back out of the store without having purchased anything at all. These same customers are still warmed up and ready to buy, and they will buy willingly if the next store they visit has the same price/value. Consumers in this mind-set are sometimes referred to as “Be Back” customers, in that they say they will be back” to buy. In reality, these customers did not feel motivated to buy immediately. Something in the sales process did not strike a chord with these buyers.
As we have learned in retail marketing, customers don’t fear buying, they fear overbuying. In other words, their fear of overpaying drives consumers to big-box stores because their television commercials promise “low prices everyday.” These consumers may perceive that buying at a big-box store will save them shopping time and money at the same time.
Competing with national-scale businesses is challenging, but with the right focus on the things that matter to the customer and with passion, care and the intelligent use of disciplined retail television, you just might make it big.
Adam Armbruster is a senior partner with Red Bank, N.J.-based retail and broadcasting consulting firm Eckstein, Summers, Armbruster & Co. He can be reached at adam@esacompany.com or 941-928-7192.

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