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Mass merchants are considered the bane of the pool dealer's business, but there is much to be learned from the big box about selling pool chemicals — particularly the problem solvers. The lessons taken can help shore up your own store's competitive approach.
Yes, even with no actual understanding of the product, mass merchants sell problem-solving chemicals. And they do it with the same sound business practices they use to sell everything else. These can be copied and adapted.
Conversely, there are elements of retail the mass merchants simply cannot provide. Pool problem solving is where their lack of expertise is most glaring and advantageous for the independent retailer. Alter your own marketing to make their faults stand out like black algae on a white pool wall.
The worst response is simply to ignore your super-store competition. Better to examine it like an invasive growth of slime, learn the source of its flourishing success — and attack its weak spots.
As their sworn enemy, many pool and spa store owners have never visited the pool care aisle at the super store. That's OK. Come with AQUA on an investigation of the independent retailer's scourge, the business pestilence known as the mass merchandiser. It could be the beginning of a new strategy that will mark your store in the customer's mind as one worthy of that extra five-mile trip beyond Wal-Mart's vast parking lot.
It's A Wal-Mart World
Wal-Mart was chosen as the model and focus for this story because it dwarfs every other mass merchandiser in the world. It does more business than Target, Sears, Kmart, JCPenney, Safeway and Kroger combined. But its business model is not much different than any other big box store, and if your pool or spa dealership is situated closer to a Home Depot or Costco, the basic equation remains.
Wal-Mart's strategy for selling PSCs is the same as it is for everything else in the store — draw customers by saving them time and money. Kill 'em with convenience and pricing.
On those two counts, the superstore cannot be beat. They have thought of everything to save steps for shoppers.
The parking lot is large and easy to reach. Your first step inside commands a greeting and a shopping cart. Along with your PSCs you can pick up your groceries, cosmetics, clothes and a new set of whitewalls, all at the same time. There's even a McDonalds. The place is practically always open.
The prices are of the rock-bottom, cutthroat variety. This is achieved by granting vendors huge volume contracts, and then squeezing them on cost-per-item like a cider press.
Wal-Mart's predatory practices regarding vendors are legendary and documented in hundreds of business books and magazine articles. Said Gib Carey, a partner at Bain & Co., a global management consulting firm, in an article in the December 2003 issue of Fast Company, "Year after year, for any product that is the same as what you sold them last year, WalMart will say, 'Here's the price you gave me last year. Here's what I can get a competitor's product for. Here's what I can get a private-label version for. I want to see a better value that I can bring to my shopper this year. Or else I'm going to use that shelf space differently.'" The leverage of being the largest, most powerful retailer makes vendor negotiation a one-way street.
Mole At The Mart
Price and convenience are a given at Wal-Mart. But it's worth a trip to the suburbs to take in the crucial details of big-box shopping.
On my undercover shopping trip to Wal-Mart, I had to be impressed with the fact that I could bring my kids along without worry. It was very kid friendly — they even got stickers.
I found the pool chemicals aisle easily, and began to browse. Wal-Mart sells them under the brand name HTH. HTH is also a vendor for Ace Hardware and Costco.
They have almost everything in the PSC armory, with the noticeable exceptions of black algaecide and some of the lesser-used flocculants. There was nothing to help you if you have pink or white slime in your biguanide pool.
But they had many common algaecides, such as quats and copper-based algaecide. Their green algae killer was $4.84 per gallon. (Don't ask how cheap the chlorine tabs were.) And they had a clarifier.
I can't comment on the service, as there was none. No surprise there. Wal-Mart doesn't really offer service. I tried anyway.
I wandered eight aisles before I located Marc, wearing a store employee badge. He stood pondering the wicker furniture, and avoiding eye contact.
I forced the issue, and he seemed surprised that they sold pool chemicals at all, but when I proved the point by showing him the goods, he agreed I was right. When I asked him which one might kill green algae, he was off to find an expert.
I thought he might have a particular person in mind, but he simply began canvassing the store, workers and customers alike, wandering the aisles calling, "Anybody know anything about pool chemicals."
His cries faded in the distant reaches of the enormous building, but he did faithfully return some minutes later with a red-faced manager who politely admitted that nobody knew anything about how to kill green algae.
Still, he found me a brochure, which gave directions, tips and included a Web site address for further info, and then he, too, slipped away, leaving me to solve my own problem.
That's the Wal-Mart shtick in a nutshell. Cut-rate PSCs in big jugs, and no questions asked or answered.
Closing The Gap
Sure, the service is practically nonexistent, but you can't beat the big box on price. That's an unchallenged paradigm in the minds of many.
Clearly, these people haven't met Angie Farmakis, assistant manager at Wolter Pool Co., Beloit, Wis., or Mary Greise, manager at Roberts Pool and Spa, Omaha, Neb. They make a good case that PSC consumers actually spend more money at Wal-Mart in the long run.
It's due to a variety of factors. First off, says Farmakis, "It's not about price, it's about the product actually working. So many times I've had a customer come in and say 'Oh, I went to Wal-Mart for chemicals, and now my pool is white! I never should have done it! What should I do now!?"
Farmakis gets the point across to her customers that pool problems and water chemistry are not breakfast cereal. They require some expertise. Acquiring it is an expense that is reflected in the price of the product, but that doesn't necessarily make it more costly to use.
Greise also takes exception to the purported savings at the big-box store. When she proves to her customers that they're actually paying more at Wal-Mart, she squashes that competitor's main selling point.
"I had a lady in yesterday with a water sample," she says. "She lives four blocks from my store, but she drives all the way out to Super WalMart for chemicals.
"Her water had turned green, so she assumed it was algae. She bought a huge gallon of algaecide at Wal-Mart, dumped it in her pool, and had no result."
"She went back to Wal-Mart, and they could do nothing for her. They didn't know why it didn't work."
At this point, the customer was already out two trips to Wal-Mart and the price of a gallon of algaecide. That's when she came to Roberts Pool and Spa.
"She had a slime problem, which I determined by asking a few more questions than 'What color is your water.' I found out she hadn't changed her filter sand since forever. It turned out the mold was just coming right off there and turning the water green."
That's what Greise means when she says Roberts is the more cost-effective solution. Figuring in the time and money wasted on unguided, unproductive measures, the pool dealer's apparently expensive solution is actually cheaper. "I can direct them to the right product or solution so they're not going to have to spend more than they need to spend," she says.
Farmakis sums it up this way: "They know when they walk out of our store the products they're holding are going to work, they're not going to have any problems with their pool, and if they do, there's someone to come back to that will fix it.
"At Wal-Mart, if you find the same person working there twice, you're lucky."
These are important points, but they do the retailer no good if they have not dawned on a cost-obsessed customer. Debbie DeVault, retail division general manager for Pools of Fun, Plainfield, Ind., has studied the big-box competition carefully, and she spends a lot of time in careful, methodical explanations.
"We go through some of the problems they'll see if they use those HTH products. We tell them to go home and look for it. We explain to them what they have purchased because a lot of them don't even know, they just throw this in or that in."
Making It Easy
Price arguments aside, it's almost impossible to match the convenience of the big box. But how close you come is important. If the difference between your convenience and their convenience can be compared to say, the Grand Canyon, then you've got a problem. If it's more like stepping over a crack in the sidewalk, they've got a problem.
Pools of Fun has closed the convenience gap by approximating WalMart's one-stop shopping concept, only on a smaller scale. While WalMart provides a single source for practically all consumer merchandise, retailers like Pools of Fun focus on the entire backyard, with grills, patio furniture and other ancillary items.
It's a pleasant experience, too. "Our stores are so much fun now," DeVault says. "We've made it into a real shopping experience. It used to be that they'd just run in and get what they wanted, but now they linger and get this and that."
The big-box competition has forced positive change, she admits. DeVault is a former pool store owner with over 25 years of pool industry experience. She's seen the super store's round-the-clock availability raise the bar for everyone. "We are open seven days a week, with long hours, just so people can't say, 'Well you were closed, so we had to run to Wal-Mart.'"
Time efficiency is just as important as availability to modern consumers, so Wolters focuses on straightforward service, says Farmakis. "They just come in and say, 'Here's my water, tell me what to do.' And we're ready. We've got it all laid out, 1-2-3 and they're on their way."
The store keeps play items set out for kids to crawl into and out of, she adds, "so the parents can relax and give us their undivided attention for a few minutes — before we hear a crash — and mom has to go quickly."
That's what makes customers drive the extra miles and make extra stops, agrees Greise. It's the feeling of assurance that a shopping errand is going to be comfortable and interactive, maybe even a social experience. "I drive across town to get my car serviced. Just because I'm comfortable with the people working there."
Service And Expertise
While a retail store can narrow the convenience and price gaps with the big-box store, eventually a dealership will either sink or swim on service.
Expertise and capability are the elements that the big-box stores simply cannot match, says Greise, because of the complexity of pool chemistry.
It's hard, even for full-time employees dedicated to the subject, she says, "and if you're selling clothes and food and jewelry, too, well, you just don't have the time."
It's up to the pool chemical dealer to make the most of that advantage. DeVault says that Pools of Fun has made great sacrifices to assure the expertise of its pool problem solvers, investing heavily in retaining a year-round staff of motivated, trained professionals.
"We have very little turnover in our store, so we have a lot of veterans that have been to the pool chemistry training schools numerous times, and we do free delivery. And we know everything about our chemicals. You cannot find that at the mass merchants."
Being the local experts, Pools of Fun actually gets referrals from the local big boxes when the pool problems get tough. "The people at Kmart and Wal-Mart," says DeVault, "will tell customers to come to our store if they have a problem. Because we know what to do.
"When it comes to customer service, we go above and beyond what people expect. I mean I have personally gone out and pulled filters out of pools and cleaned them for customers. We go that extra mile."
Having a service edge is one thing. Getting the idea across to the customer is another. At Wolter Pool Co., says Farmakis, they make it as obvious as possible that customers are in the hands of professionals, not stock boys.
"When our customers walk in the door," says Farmakis, "they know we're about water testing and taking care of their pool. They can see an extensive lab. And they know that we do water testing and we do it well. We advertise it, and it gets around by word of mouth as well."
The best time to market your pool problem solving expertise, all agree, is when the original equipment is sold. That's when you have the customer's full attention and dependence. It's up to the retailer to win them at that point and keep them from ever being tempted to stray.
The best way, according to Farmakis, is training and routine. She tries to get them used to a pool care regimen, which, like any habit, will be difficult to break.
Farmakis notes that once a customer is comfortable using a certain brand of product, they can no longer go to a mass merchandiser because they simply don't have it.
Exactly, says Greise: "We sell customers on a program. We educate them on this when we deliver a pool or spa — if you don't want to have those kinds of problems, you come to us and we'll get you on a three-step weekly program, so you don't ever have to wonder what clarifier or algaecide is."
Pool season is in full swing, but it’s never too late for retailers to see their profits grow. The key is less about changing what you’re doing and more about improving how you’re doing it. Through savvy retail execution and delivering an unbeatable shopping experience, brick-and-mortar retailers can overcome traditional retail rivals and combat online competitors to take their business to the next level.
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This regularly recurring column is brought to you by APSP’s Manufacturers Council, featuring hot issues impacting today’s industry, business insights and tips you can use to enhance your personal development and business success.
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