The Advantages of Working with Consumer-Direct Manufacturers - ResidentialSystems.com

The Advantages of Working with Consumer-Direct Manufacturers

Let’s call a truce. Direct-to-consumer AV brands are not the enemy of brick-and-mortar AV dealers. Manufacturers that adhere to a strict, Internet-only sales platform certainly don’t help the retail sales of independent or locally owned businesses, but traditionally consumer-direct companies pursuing a blended distribution strategy offer plenty of compelling reasons why you should consider adding them to the product line-up.
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Let’s call a truce. Direct-to-consumer AV brands are not the enemy of brick-and-mortar AV dealers. Manufacturers that adhere to a strict, Internet-only sales platform certainly don’t help the retail sales of independent or locally owned businesses, but traditionally consumer-direct companies pursuing a blended distribution strategy offer plenty of compelling reasons why you should consider adding them to the product line-up.

1.Performance Value – You will offer your customers great, sometimes game-changing products. Consumer-direct manufacturers can’t afford to make products that only line up with the status quo when it comes to performance, or else they’d end up with a mountain of returns and red ink. To ensure consumers keep the products after an in-home trial, they need to be over-engineered to exceed expectations and compete with products costing twice and three times as much.

2.Differentiation
– Consumer-direct brands tap into a dynamic and future-facing go-to market strategy that represents the future of commerce and one of the few growth areas in the industry. The vitality that allows these brands to experience consistent, steady growth when many retail-only audio and video manufacturers are struggling to break even is something you can benefit from immediately. Consumer-direct partners can bring new Internet subject matter expertise to the equation, and are often happy to help you with your own Internet strategy.

3.Third-Party Validation - Brands without retail exposure can’t sell products unless they generate excitement and earn credibility with customers through reviews, editorial, and just being cooler than their retail facing counterparts. We run unvarnished customer reviews on our site because, good or bad, it shows we’re not hiding anything and we value our customer’s opinions. When a consumer does their research and sees overwhelmingly positive feedback from consumers and professional reviewers alike, on a product you recommended, it boosts their confidence and your credibility as a dealer and their technology consultant. You can’t put a price tag on independent validation, but it matters more than ever in the Internet-age.

4.Customer Support – Have you ever felt like a manufacturer or supplier wasn’t extending the same level of service or support you offer to customers? Consumer-direct brands work with their customers directly 24/7, so you can always expect to be treated with the same white glove service as someone who’s considering their first purchase. Of course, you understand your customer’s best so most brands will tailor their level of support and service based on your individual business, but highly-trained customer service and technical support reps can be a great resource when you need them.

5.Unilateral Resale Policy – Because I was retailer with MyerEmco for most of my professional career, I understand margins are important, but there’s a big difference between theoretical and actual margins. Consumer-direct brands that offer URPs guarantee predictable margins so you know what your actual profit will be on the brand at the end of the day, net of returns and discounts. More importantly, it means you’ll never compete with the consumer-direct brand itself offering a lower price. You’ll also avoid customers coming back and saying, “Well, I found it cheaper here,” which can hurt the trust they have in you and end up in a negative Yelp or Google review for your business.

6.Value Adds – Consumer-direct customers tend to be more technically savvy and DIY-focused than retail shoppers, because they have to be. They like the ability to make fine adjustments to get the most out the products, so in general, products are designed to accommodate this urge to tweak. From a retail perspective, your expertise is the added value. Once you’ve built their trust, you can pass along revenue generating installation services, DSP optimization, room correction, acoustic treatments, and more in the pursuit of peak performance.

7.SEO/Social Web Support – One of the biggest struggles I had when working in retail was finding compelling content to share on the website and the resources to keep it fresh. It may not seem core to the mission, but a cool and actively updated site can be one of your most valuable marketing tools. A “set it and forget it” approach might work with rotisserie ovens, but with websites, you need fresh and interesting content to drive consumer awareness and excitement around your business and the brands you sell. Since most consumer-direct sales originate online, they have to maintain a strong web presence or risk fading into obscurity. As dealers, you can leverage this passion by requesting backlinks, participating in social promotions or sharing reviews and other content that will make your site more active and a source of excitement among potential and existing customers.

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After working more than two decades in retail, it was a revelation to see the energy and vitality that can exist in a company that operates with a consumer-direct model. The transition truly opened a door to a world I didn’t know existed and I strongly believe that dealers who are open to embracing consumer-direct manufacturers will have the same positive reactions and better position themselves for future success.

Gary Yacoubian is the president and managing partner of SVS.

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