But there are steps members must take to encourage them
By Alan Wolf, YSN
Forecasts by the appliance, home furnishings and bedding industries for a challenging first half of 2023 are proving to be prophetic, said AVB’s VP of Merchandising Chad Evans.
The trick, he stressed during the 2023 Summit’s General Session on Monday, is for members to have their advertising, promotions and online tools in place before business picks up in the back half of the year.
Indeed, executives across BrandSource’s home goods categories are projecting mid-single digit declines for all of 2023, with the brunt of the softness coming in the first quarter. The downturn follows three exceptionally strong years, when inventory availability was the primary draw for shoppers, Evans said.
Today, however, the onus “has shifted back to old-school advertising and promotion to drive sales,” Evans said. “The most important thing to focus on is how we invest the necessary advertising dollars to drive consumers to our websites and stores,” he told attendees. “And to make sure we have the promotions and materials to let them know you are competitive once they are there.”
The concern, he said, is that some dealers may instinctively pull back on their marketing spend amid a sales slowdown, which is precisely the opposite tack to take. Rather, “The opportunity that lies ahead is to put the foot to the gas, because this is when share is won.”
The strategy clearly proved effective during Black Friday 2022, when members who utilized AVB Marketing’s vendor-supported holiday ad bundles outperformed in a slowing market, even against the prior year’s historic double-digit increases. Unfortunately, he said, the importance of advertising and promotion, especially around the major holiday windows, has not been lost on the box chains, which have upped their marketing game and are recouping some of the share relinquished during the pandemic.
In addition to aggressive advertising, independent dealers must also provide a stellar shopping experience online, which Evans described as “table stakes” in today’s marketplace. Comparing the e-commerce fundamentals to automobile backup cameras, which were considered a luxury just several years back, he said website features like transparent pricing, in-stock status, multiple payment methods, and an on-sale/savings story are now mandatory for competing in retail.
“There is no doubt that BrandSource dealers can sell a better mix than anyone else, can get product to a customer more quickly and effectively than anyone else, and deliver and service on the back end better than anyone else,” Evans said. But members must also “take the necessary steps to make sure the online focus matches everything else.”
YSN publisher AVB BrandSource is the nation’s largest merchandising and marketing co-op for independent appliance, mattress, furniture and CE dealers.