Tip of the Week

Business SMART:	Why We Need New Customers
	By: Dennis A. Conforto Chairman & CEO of A-Z Media Group, Inc.

New. It’s a word you probably hear more often than any other in your business. If you’re a manufacturer, you’re constantly being reminded of deadlines for new products, for mock-ups of a new design or for approval on new packaging. If you’re a retailer, you are being prodded with questions like, “Are you going to be getting this new line in?”, “What new classes are you offering,” “A friend of mine tried a new technique, how do I do it?” “Where do you keep the new products?” New can be good, but lately new is causing friction in the marketplace. Why? Because the only new being focused on is new product; new products to keep our old customers happy. These current mainstay consumers that are being catered to in the scrapbooking industry are consumers who are nearing the end of the 7 year craft cycle. At the end of this 7 year period, the vast majority of them get burned out and move on to something else that they can master in their lives or they spend their time pursuing something else entirely. So the question is, “Why do we need new consumers at all?” Of course the answer is that the market will shrink if we don’t find new consumers and fast. The tried and true ways of marketing the scrapbooking category are becoming less and less effective. Word of mouth has had its day, and sending out newsletters to a retailer’s client base becomes less and less effective over time for the vast majority of scrapbooking retailers. To further complicate that matter, only 12% of women in North America are in one craft or another and 40% of those women are scrapbookers. Since scrapbooking is a craft and scrapbooking has captured such a huge percentage of the craft market, we must ask, “Where are the future scrapbookers going to come from?” It is unlikely that the scrapbooking industry will capture more than 60% of the craft market, fortunately, this figure still allows for some growth. However there is that nagging issue that crafters only stay active within a craft for about 7 years. The scrapbooking industry will have to change to adapt itself in part to the non-crafter. This will require new products, new product categories and sweeping changes in the thinking of the everyday independent retailer. Over the next 18 months if you as a scrapbook retailer don’t seriously address the needs of the digital scrapbooker, you will miss out on a huge percentage of where your sales could be coming from. Over the next 18 months if you as a scrapbook retailer don’t seriously address the needs of the instant scrapbooker who only has five minutes to run into your store with a problem and walk out with a fast solution, you will miss out on a huge percentage of where your new sales should be coming from. Over the next 18 months if you as a scrapbook retailer don’t seriously address the scrapbooking needs of a corporation you will miss out a client base that is loyal, has a high average sale and who will be a repeat client for years to come. The changes that are coming will be large. They will affect your store’s look and feel, the kind of products you carry, and even who your new vendors might be. Your client base will be new and different, and how you find them and retain them will also be different. Change is coming and it is coming fast, for those that embrace change it will be an exciting time because the rewards are high. Those that fear change will be slow to react and the rewards will be lower that those that can and are willing to adapt to the ever changing conditions of the market place. When you are in retail it’s about changing on the fly. In another words, building the plane while it’s rolling down the runway. It can be frustrating, for sure, but this is the world that we live in; change is happening at break-neck speeds and we have to understand that this change is part of the rules of retail success today. What this means is simple. Partnerships in business going forward are the key to your success. As a retailer you need to fight for those partnerships with your suppliers, the companies you use to market your products and services through, and for the new consumer who today has never been to a scrapbooking store. The scrapbooking store of today will not fit the needs of the scrapbooking store of tomorrow. The rules of today will not apply to tomorrow. In fact many of you are already seeing that which used to work doesn’t work as well today. One of the real dangers in running a retail business today is looking to the past. Thinking, “I will just do what I use to do when I was more successful,” is not going to lead to success in the future. The problem with that thinking is the world of the past is nothing like the world of the now. The world of the future is already starting to change the now. The independent stores will learn quickly that to thrive in the future they will have to cooperate with independent stores that are within their same marketplace. We see this type of cooperation all the time in other retail sectors. Take for example movie theaters. They have the same popcorn, the same sodas, the same candy and the same movies; in fact, everything is the same at just about any theater you could visit. Yet every week they are in the same section of the newspaper making sure they call enough attention to themselves as a group because they know that more people go to the movies because they cooperate than if they didn’t cooperate. That is what being business SMART is all about.