Article Number : 1900 |
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| Date | 4/12/2007 11:40:46 AM |
| Written By | LGM & Associates Technical Flooring Services |
| View this article at: | //floorbiz.com/BizResources/NPViewArticle.asp?ArticleID=1900 |
| Abstract | By Steven Feldman Albuquerque, N.M.—Branding and co-branding took center stage at the recent Floors to Go convention as management called on members to capitalize on the group’s proprietary labels and national identity... |
| Article | By Steven Feldman Albuquerque, N.M.—Branding and co-branding took center stage at the recent Floors to Go convention as management called on members to capitalize on the group’s proprietary labels and national identity. The idea is that by using the Floors to Go name in conjunction with members’ own identity, the consumer can recognize each store as a nationwide chain. “Everything we do as an organization surrounds the identity of Floors to Go,” said Steve Silverman, president and COO of parent company Abbey Carpet. “If a member simply called itself Smith Floor Covering, the store would have no national identity, and the reason he joined is dissipated.” He added that the concept is nothing new. “It just needed to be put in front of the membership so they recognize the importance.” To its credit, Floors to Go has come a long way since the purchase by Abbey Carpet five years ago. Back then, less than 20% of members flew the Floors to Go flag as part of their exterior signage. Today that number has swelled to 60% of the 250 storefronts that comprise the group. “We’ve come a long way but still have work to do,” he said. Branding of the interior is equally important, and that is accomplished through private-label products. To accentuate the point, Silverman noted that 50% of the products sold by mass merchant Target is branded as Target. Likewise, 40% of product Wal-Mart sells has only the Wal-Mart identity. Why? “The answer is improved profitability because it is more difficult for the consumer to compare products and pricing.” To that end, Floors to Go launched the private-label Designers Choice laminate program consisting of 72 Mohawk/Unilin SKUs. The collection is a blend of handscraped, exotic and domestic looks. “We covered all the bases—price points, styles, etc.,” said Keith Spano, vice president of marketing. “We have solids for the north and engineered for the south.” He added that the Designers Choice hardwood program, which consists of 54 Mohawk styles, has been revamped. Given that hard surface represents 50% of Floors to Go member sales, the group created a brand new customized TV spot—representing the first hardwood-specific ad for the buying group. “The commercial is geared toward showing the consumer that her locally owned Floors to Go is the hardwood destination in her marketplace,” Spano said. “We look to accomplish this through image building. The 30-second spot offers 20 seconds of image and the last 10 seconds are customizable.” Hard surface is also supported by new consumer brochures. “The commercials are designed to bring them in; the brochures and new merchandising vehicles support the line once the consumer is in the store,” Spano said. Silverman noted that the goal is to “boutique” all Floors to Go stores such that there is a hardwood section, laminate section, tile section, etc. “The hardwood section is an outgrowth of the display system we invented a couple of years ago. If you walk into a Floors to Go store you would find a hardwood department segregated by itself. Products flow from exotics to traditional, by price point, so it is less confusing to the consumer.” Evolution When Phil Gutierrez, Abbey Carpet chairman and CEO, purchased the assets of Floors to Go in 2002, he took over an organization with a name, rebates, suppliers and display system, Silverman said. “Floors to Go had an identity, but it wasn’t a strong identity because it takes resources and quantity of members to build a successful organization. So we went about our business of opening new members and adding to the supplier base.” In 2002, 70% of membership was located west of the Rockies; today it’s 50/50. “And that’s changing; we are adding more members east of the Rockies.” When Abbey took over, there were only 35 suppliers in the program. Today there are 125. Silverman noted that purchases have increased fivefold and rebate percentage growth is 600%. Marketing efforts were also stepped up. “We have professionally done not only TV spots but radio ad flicks and all types of print ads for private sales,” he said. “This could only be done through a company with economies of scale. We’ve watched our members become more professional. They have more store tools to use, more suppliers from which to choose, more educational opportunities at convention, all of which lead to a higher ticket. Because of economies of scale and these tools, the result is a more professional member.” Bob Sloan, Floors to Go, Pompano Beach, Fla., attributes everything the group does to his success. The former furniture dealer has been a member for two and-a-half years and admittedly knew nothing about flooring when he joined Floors to Go at the suggestion of his brother, a Floors to Go member in Orlando. “He told me to just follow the program and I couldn’t go wrong. I’m a believer that you need to be a member of a national chain because it has the experience on what it takes to be successful. I use all the marketing materials. Floors to Go does the homework; it takes the guesswork out of it for you. If you follow the program you can’t miss.” Sloan noted that his store is extremely successful and works on 40% to 43% margins. Moreover, despite having only 1,000 square feet of showroom space, people are overwhelmed with the selection of products. “Because it’s not a big store, I have no room to carry anything but approved merchandise. I get a lot of product in a small amount of space.” New products Floors to Go introduced to members a pair of new brands: Scandian and Fiberworks, the latter a manufacturer of natural carpet materials, like jute and sisal. “If these retailers did not have a Floors to Go convention, odds are 70% of them would not be exposed to either of these two companies,” Silverman said. “Both companies offer products that are out of the mainstream, and Floors to Go members can attach nice margins without the fear of being undercut by the guy down the street.” |