Small Business: Being creative in placing products for sales
In the battle to win shoppers' dollars, small companies are finding creative ways to be where the sales are.
Evolve Professional of Westbury sells upscale men's grooming products in cigar stores. GSC Products of upstate Scotia sells its nasal spray in hardware stores -- to people working on projects that stir up dust. And North Carolina-based Simplicity Sofas pays previous customers to let potential buyers come into their homes to see sofas that can only be purchased online.
Small businesses don't have the advertising and marketing budgets of larger companies. And fighting for the limited amount of space available on store shelves can be tough and costly.
"It's difficult to break through the clutter and the noise," says retail consultant Ted Hurlbut. "You need to be creative."
Here's a look at what three small businesses are doing:
SMOKING OUT CUSTOMERS
Daniel Marrone, owner of Evolve Professional, has held demonstrations at more than 125 stores over the last two years to introduce men to his razors, brushes and shaving cream. He recruits barbers who shave customers and explain the art of good grooming. Marrone sells his products at the events, and some stores agree to stock them.
So why cigar stores? To sell his upscale products, Marrone realized he had to be where prospective customers go. So he began searching for stores where a man might spend $50 on a cigar. He checks out a store by buying a cigar, smoking it there and studying the customers to see if they're part of his target market: successful men ages 40 to 60 with expensive taste who want to look good.
Trying to get his products in big department stores, where he'd have to compete against many other consumer products companies, wouldn't help him build his brand, Marrone says.
"I go under the radar to create a buzz and word-of-mouth advertising," he says.
BUILDING A CUSTOMER BASE
GSC Products sells its Sinus Plumber nasal spray in hardware and automotive stores and garden centers. Owner Wayne Perry says the spray, which contains pepper and horseradish, is in nearly 1,000 stores that stock it near the cashier, where customers make impulse buys.
He would have to pay more to get his products in the most visible spots on the cold and allergy remedy shelves in drug and health food stores, he says.
Hardware store owners read about Sinus Plumber in news stories and contacted Perry.
"They were outselling all of the health food stores we were in. A couple of cases a month, really unheard of for a single store," he says.
It turns out hardware and home stores are a logical place to sell nasal spray. People who use paint and chemicals can stir up dust that triggers allergies and irritates their sinuses, Perry says.
Of GSC's $350,000 in revenue last year, $90,000 came from hardware and automotive stores. They sell 40 percent more Sinus Plumber than traditional stores.
Simplicity Sofas of High Point, N.C., sells its sofas and chairs only over the Internet. Some customers want to see and try out the furniture. So owner Jeff Frank contacts people who have already bought his products and asks them if they'll let a prospective customer take a look. Most people say yes. In return, Frank sends them a $50 check.
He says he got the idea from customers. Several called Frank and volunteered. He decided to ask others.
About 10 percent of prospective customers ask to see the furniture, and 10 percent of Simplicity's sales come from in-person encounters. The strategy spurs word-of-mouth buzz. Happy customers tell other people about the process. That has led to more sales.
Customer Jim Hamren says it was a little strange to shop in someone's house. But it was better than going to a store, because he and his wife could see how owner Rebecca Gwynne had moved her sofa past a tight space.
"She had to go up a narrow staircase. When we saw that, we said, 'If you can do this, we can certainly get it into our house,' " Hamren says.