Know-How Exchange : Strategy

I would think that asking which is better - a flat referral fee or a percent of sales - for consigned furniture for real estate agents and decorators would be best asked of your target - real estate agents and decorators. Here on this forum, you may find a few real estate agents or decorators, or some marketing people who have marketed to real estate agents and decorators - maybe even that one unique marketing guy who marketed consigned furniture (or some similar commodity) to real estate agents and decorators and conducted research on commissioning. But, I would suspect that would be rare. So, what you will get is a fairly random group of opinions from numerous people who may or may not have anything in common with your target audience. The opinions will most likely have the same relevance and significance as if you randomly asked people walking into your store, in a grocery store, or on any street corner in Gladstone, OR. In fact, since the demographics and local customs may be important in the answer, answers street corner in Gladstone, OR should be more relevant.

So, let's do some real marketing here. Let's talk to real estate agents and decorators. Several things are important to understand. First, do their customers ask them about where to buy furniture? If so, would they offer them "an option" for consigned furniture? Would they feel comfortable making this recommendation based on the fact that they would make money on the recommendation or would they feel like this would betray the trust of their clients? Is it customary for real estate agents and decorators to take commissions based on their recommendations? The reason I have this concern is that a real estate agent and a decorator make money based on building rapport and trust of their customers. This can mean follow-on business and recommendations. This is their biggest source of marketing and probably their biggest source of revenues. They will be making TONS more money this way than via consigned furniture commissions. I would suspect that they would have few opportunities to make a recommendation to clients for consigned furniture and therefore their revenue stream from commissions would be a pittance compared to their main source of revenue. While everyone likes "free money," I would wonder if they would risk screwing up main marketing efforts and revenue stream. If this is the case, you can offer whatever incentive you wish and I doubt you will have to worry about paying off commissions very often. And your efforts to attend realtor manager meetings most likely will be thwarted or at best, you still will not see significant results. However, the proof is in asking those practitioners to find out if my "gut feel" has validity.

Now, one avenue for you is to borrow from the real estate agents' marketing methods: Make word-of-mouth a significant part of your marketing efforts. First, give "commissions" in the form of discounts to repeat customers: Second piece, 10% discount or alternately, $50 off (your choice, not theirs). Third piece, 20% ($100) discount, third piece, 50% ($200) discount, fourth piece, free....or something such as that. And make the discounts applicable whether they buy today or over the next two years. And the discount counts based on the customer sending someone else to buy the piece. In other words, if a customer buys one piece and sends a friend to buy a second piece, and then the customer comes in to buy a second piece, they get the "third piece discount."

You mentioned about builders renting furniture. Another avenue for "advertising" is with restaurants. Offer some of the high end restaurants (High Rocks?) certain pieces of furniture (with the furniture owner's permission) for their lobby. Place a sign near the furniture for your store. You see this done with paintings in restaurants sometimes. You could do this with other places of business too - doctor's offices, real estate agents, etc.

With respect to your website, I like your demo - it exudes class. Your home page, however, loses me because the "featured pieces" (as they are now) are fairly common-place items and not those "classy" pieces. They seem to be inconsistent with your "brand." Additionally, the "Information" link title is non-descript. After I clicked on it, I said, "Yes, this is good stuff - and I'd want to know this." But "Information" is so general, I wasn't compelled to go there. And I never even thought about the fact that I didn't know how to consign with you so I wouldn't have thought to look for this. In other words, I didn't know what I didn't know. So, instead of "Information" maybe make the link "What you need to know about consignment." Long, but much more descriptive and it will prompt at least me to wonder what it is I don't know and look at it. A third and last point is that your website is all "features" and no "benefits." Why would I want to buy furniture from you? How does it meet my needs? Why do I want to look at your online showroom versus go somewhere else. Filling pages with "features" versus "benefits" is a common mistake on many websites. It's benefits that differentiate and sell. You want to differentiate and sell, not just display all you can do.

I hope this helps.

Wayde

you need cheap or free publicity....

I suggest going to the builders council and asking if you can take on the decoration of a model home in one of the parades of homes...

I like the realitor meetings.

What about meetings with decorators or furniture stores. Top end buyers are often looking to recapture some of their money.

Judy,

The builder route is very good but you need to find the right builder. A newer builder will be better than a well established one as they don't often lease, but top furniture stores often provide display pieces for free as well as provide additional decor.

Watch the parade of home ads in your area. Find out about the builders and go to the show. When it's not busy, ask the builder where they're getting their furniture and determine their interest level. Many small builders use their own stuff and might even be interested in buying for themselves.

These are things I know from personal experience.

Also follow the Recency method as most direct mailers do. After closing, most home buyers will realize they don't have the money they thought they had. A well designed door hanger will be very effective. If you can co-op with a nearby business (pizza place?) for the hanger it'll keep your costs down.

Michael

I would suggest that the best way to accomplish your business goals would be to have TWO phase approach.
In Phase one, we focus on your aim of increasing the inventory to increase sale (as listed in your question),
and in Phase 2, we find a way to reach end consumer and increase the sale.

AA) TO ACQUIRE INVENTORY OF GENTLY USED FURNITURE, instead of any promotion, or incentive offer, consider promoting the concept of " Fund raising through furniture consignment".

How it will work is that you introduce a Fund raising program and start targeting organizations/churches etc, that is in need of money. Let them know that your company can help them in fund raising.

Ask them to bring to you their good quality, sellable furniture that they were going to donate anyways— Let them donate it to your store—You sell it and the agreed consignor portion can go to the participating organization.

BB)TO INCREASE SALES.
Ofcourse, since most of the sales you have been doing for past few years, you willbe more comfortable with whatever strategy you think is working, or, will work for you. However, in my opinion, you can increase your sale through your website as well.

(By the way, it looks great...! Consider having a homepage with eye catching buttons (Buyers CLICK HERE and Sellers CLICK HERE) This way it gives a clear picture of your business model, that you encourage buyers/sellers both to do business with you)

As off-line, I would suggest to target commercial property management companies and build relations with managers. This will definitely help you to Buy and Sell both. Also, academic institutions could also have good business potential.

Hope this gives you some ideas.

Just to offer an extension of an idea listed above. You cold contacta restaurant or bar owner and have their entire premise decorated in your furnitures. Have a little price tag that hangs off every piece so that while customers are dining, they'd be able to see how much things cost and how the pieces fit into each other.

In the begining, you'll probably have to start small, one or two locations and not charge them a lot of rent. But as you get more popular, you could cover lots of retail outlets or perhaps open a bar of your own? The reason why i brought this up is because i know of one furniture supplier in Guangzhou china whos has opened their own bar and everything inside is available for sale. It was basically a showroom which serves drinks and food.

charlie

Hi

Given your position in town & the kind of responses u got to various marketing techniques, i think you should go for a crisper direct marketing.
Instead of paying commission to real estate agents for referrals, give them a offer of some flat fee for every 10 (or 20 depending upon local circumstances) contacts, he gives you of people who are in the process of changing home in the same town. You should get both their previous & new addresses. Now you can directly mail or call these people to

1. Dispose off their old furniture

2. Purchase the new furniture from you.

In this way your targeted advertisements will generate more results, and you can save funds on different advertisements for inventory inc & sale. In this scheme wealthier people shifting to new homes will tend to sell their furniture & people who are in loans etc may prefer buying from you to save costs. In any case you will get larger no. of convertible leads.
Real estate agents too would not have any qualms regarding their relationships with customer and they will get free money from u without any risk as you will be contacting the people.

Hope it helps

Anubhav

Two things:

It could be helpful is to partner with antique/furniture appraisers in your area and outside your area. That way you can offer a free appraisal to potential customers. this will let you in the door and possibly increase your inventory. You will have to work out a deal with the appraisers. Because they will want some of the furniture for their shops, but I think it could be a successful partnership. Post the offer on your website and in direct mail.

Lastly, See if you can get an advertorial written by the newspapers you advertise in. I worked at a Newspaper in FL a few years ago, writing advertorials. They were often more successful than a display ad. We always received calls from the businesses that their sales went up in direct correlation to an advertorial.

Jess

You'd be surprised how much realtors have to end up dealing with furniture -- either getting or getting rid of it. Market toward high-end rental apartments and condos is your best bet where realtors are concerned.

Please see my website at www.principe-programming.com for lists of real estate agents by state. It has e-mail and postal mail addresses for real estate agents that are harvested from the state associations. Very inexpensive.