Are bathroom manufacturers still willing to support independent showrooms? Or is the increasing lure of the online channel threatening the future of the high-street store? In this special focus, we feature the views of two retailers who insist the time has come to hold manufacturers to account – and get the reactions of two of the companies they criticise
‘Enough is enough…’
Richard Hassell, director of More than Baths in Doncaster, is urging showrooms nationwide to boycott brands that sell their products cheaper online than retailers can buy them for at trade prices
It’s about time someone stood their ground against suppliers. Aqualisa being the first.
Owning a retail showroom has its challenges, but when it comes to Aqualisa showers, it’s a battle you cannot win. The issue is online retailers selling it cheaper than showrooms can buy it for from distribution or on a direct account.
I have just been on the Aqualisa website to search for showrooms that waste valuable space to showcase the brand’s goods. To my surprise, the site has a pop-up that appears when you search for a showroom. The right-hand option asks you to enter a postcode to find your local Aqualisa showroom, but to the left of that, it offers the option to “buy from an approved online retailer”. Then it lists several internet retailers.
Now, not only is Aqualisa telling the public to buy from online with that wording, they are laughing in retailers’ faces, basically saying visit a showroom, get educated about our goods, get a price, then go online to get it cheaper.
Enough is enough. There are a number of companies like Aqualisa doing this, so I’m calling on retailers across the UK to pull together and remove Aqualisa from their showrooms. Then let’s see how far they get.
It might not make a big impact at first, but if we don’t show it and educate clients on the ranges available, how will they know about the product? It’s a rare occasion when a client comes in and demands Aqualisa.
This is one reason I’ve taken out certain brands and replaced them with committed, reliable ones.
At the end of the day, we pay for our overheads and companies insist we have to meet their criteria. Well, how about we don’t. It’s about time showrooms took back control.
After all, we are the heart and soul of the bathroom industry. I already have a large number of showrooms ready to commit, so if you’d like to join them, please get in touch.
Right to reply
Aqualisa sales director Adam Rhodes responds
It always stings to receive negative feedback from showrooms about how Aqualisa is perceived. Bathroom showrooms have been instrumental in Aqualisa’s success over the past 40 years – we value their support and continue to invest heavily in this strategically important channel.
As an example, we recently made our biggest ever marketing investment to promote our Q smart shower range in a TV campaign. This initial trial in the Meridian region resulted in hundreds of leads for showrooms in that area, and we extended this advertising across the UK into May and June. We’ve also invested more than £1 million in showroom displays in 2017, which included supplying circa 1,800 Q displays free of charge, as well as providing the opportunity for them to sell our exclusive Q Edition range.
In tandem, we have endeavoured to enhance our support to showrooms via our distributor partners, who supply many of them, to allow them to be more competitive on Aqualisa products.
Furthermore, we have run joint retention marketing campaigns with 80-plus showrooms, contacting customers who have previously bought an Aqualisa shower and using Aqualisa’s marketing and contact centre resources to speed up their repurchase cycle. One such showroom was recently able to sell a £10k bathroom refurbishment on the back of such an initiative. Additionally, this campaign not only benefits these showrooms, but also their approved installers by potentially training and utilising them for the installation work.
However, Aqualisa’s end customer is ultimately the homeowner, and we have had to move with the times. This means we have not only had to evolve in terms of product offering and design, but also recognise changes in the way that consumers now purchase goods. Failure to adapt is not economically viable. We have all seen the recent demise of Maplin and Toys R Us, for example, and yes, this has meant we have chosen to open up our distribution network to include online retailers and the very different experience they can provide.
But we haven’t just partnered with anyone. For example, we are regularly contacted by one leading online retailer, but despite a growing number of shower manufacturers dealing with them, we have consistently declined their offer. This is because we do not believe they will enhance the consumer experience, but will instead feed from the business generated elsewhere. We have carefully selected a handful of pure-play online bathroom retailers who we believe can add value to the consumer purchasing experience.
The Aqualisa website provides links to both our showroom and approved online partners, recognising that some consumers distinctly prefer to visit one over the other. We actively encourage approved showrooms to upload their details on to the showroom finder.
We also welcome feedback from our showroom network via regular forums – indeed, we engaged a showroom principal to input into our strategy for this channel and we are amending some of the wording on the website to ensure both channels are given similar exposure to consumers.
So, in summary, in our view, a showroom’s offer is markedly different from that of an online retailer. We believe that the customer experience and added value a showroom is able to provide will always appeal to a segment of the market. But in 2018, we must also accommodate those that want to find their product online, as many of us do in other categories, and as many bathroom showrooms recognise by running their own websites.
We are keen to work with all of our customers to help build their business – and we would encourage showroom owners to contact their Aqualisa area sales manager and speak to them about the support we have to offer.
‘Where’s your loyalty?’
Paul Etheridge of Coastal Bathrooms in Hampshire insists consumers buy what showrooms recommend – and these won’t be products they can buy cheaper from Screwfix
Over the Easter period, I was fortunate to share some well-deserved down time with some close family and friends. Once such friend brought around a beautifully decorated and delicious-looking cake as a gift.
The only problem was that this friend liked the gift so much, they quite fancied a piece themselves. While the cake was being divided, my mind inevitably turned to work, specifically the future of distribution within our own industry and how some manufacturers want to have their cake and eat it too.
Furthermore, what is the future for independent showrooms and merchants? These are pertinent questions any business owner must ask when considering the way certain manufacturers are conducting themselves these days.
Traditionally, with products that go through distribution, there have been five slices of the cake. One for the manufacturer, one for the distributor, one for the showroom/merchant, one for the installer and one for the consumer – obviously, sometimes the consumer will deal with the showroom directly. However, for the purposes of this article, let’s assume there are five slices.
A good example is a well-known shower manufacturer that I personally have been dealing with for over 25 years. We have continually supported this particular manufacturer by displaying several of their ranges and training our staff in the benefits of their products.
Over the years, we have sold thousands of their showers, in particular their digital offering, and we have been extremely loyal to their brand. So, how has our loyalty been repaid? The answer is simple – it hasn’t. We can now buy some of their ranges cheaper from the likes of Screwfix than any of the distributors we deal with. If we want a more advanced model, the cheapest option is to go to the manufacturer’s own website, click the “buy online” button and choose one of the huge online retailers offering better deals than any of the distributors we buy from.
One slice of the cake removed – distributors – and a huge question mark over why distributors would invest time and large sums of money in stocking this type of product in the first place?
Obviously, the installer or consumer can also purchase through these channels at the same price a showroom or merchant can. That’s another slice of the cake removed – showrooms/merchants, the very people who helped build the brand in the first place.
Well, I hear you say, at least the installers are OK. Unfortunately not, as this particular manufacturer will also offer to supply and fit a replacement shower at a very competitive price when the consumer contacts them directly. Obviously, when a consumer registers their shower for guarantee purposes, the manufacturer has their details on file, thus enabling them to contact the customer directly in the future and create direct sales. So that’s three extra slices of the cake for the manufacturer.
Not only does this manufacturer want to have their cake and eat it, they also want cream on the top, expecting showrooms to display and supply a premier range that uses the same technology, but with a bit of restyling. This allows the manufacturer to command a higher price tag and, yes you guessed it, make more profit.
Interestingly, the flip side of this is a certain high-quality bath manufacturer I met the other day. They appreciate that online sales for their products are the result of showroom staff promoting the products and consumers then going online to find the cheapest price. They realise that, without the investment in displays, time spent with consumers and the ability to see and touch the physical products, there would be no online demand.
They are taking steps to ensure that only those who commit to displays and sales training will receive discount on their products. They do not feel they will lose sales by cutting out the online channel, as consumers will purchase the product from the showrooms who encouraged the purchase in the first place. As a showroom owner, this is very refreshing, and a far better option than the shower manufacturer I mentioned.
With the recent demise of BCG, you have to wonder whether distribution is still a viable business model. The smart ones are establishing exclusivity to certain brands and are therefore able to control who sells them to a certain extent. But when it comes to mass-market products like the shower manufacturer mentioned above, this certainly no longer seems a viable option.
As far as showrooms are concerned, why would we display this type of product? If we get an enquiry, we can simply buy online ourselves – there is no need to take up valuable showroom space. We are far better displaying brands that at least try to support independent showrooms.
Our clients are certainly influenced by the advice given to them by our designers and sales staff. The items we put into our designs, and show confidence in, are generally the ones the client ends up purchasing. If we put doubt into the customer’s mind about a certain product, they will shy away from that range. In my experience, consumers are not generally very brand-aware and are guided to specific brands by the designer/sales staff. A large number of sales taken by online retailers are as a result of the products originally specified by showrooms.
Manufacturers who choose to allow online retailers to sell their products at a vastly discounted price will ultimately reduce their market share as showrooms realise that displaying their products is not a viable option, whereas manufacturers who support showrooms and create a level playing field will reap the rewards.
It’s time some lines were drawn in the sand, manufacturers need to decide if they want to support distribution and showrooms/merchants or go for the online/direct route.
Showrooms on the other hand need to collectively remove these products from their showrooms and support brands that choose a ‘no display, no discount policy’ and show loyalty to those who create a market for their brands in the first place.
By doing this, it may be possible for us to profit more fruitfully from tucking into a fair portion of a Mary Berry delight.
Right to reply:
‘Online retailers and showroom are not competing for the same customers’
James Hickman, managing director of online retailer Plumbworld, responds to Richard Hassell’s criticisms and says that if showrooms spent more time delivering quality advice and service they would flourish
I certainly do not believe that it is “laughing in the face” of showrooms for Aqualisa to promote its product through the online sales channel – they are simply being fair to all their customers, while providing greater choice for the consumer.
I know that many showroom owners want desperately to believe that they are the “heart and soul of the bathroom industry” and internet retailers are little more than parasites living off their hard work. Stealing their business by offering heavily discounted prices to “showrooming” consumers. I suppose this gives them an excuse not to look in the mirror and examine the real reasons why their businesses are struggling in a changing world.
Unfortunately for them, when you look at the data, it dispels this illusion and proves that widespread “showrooming” is nothing more than a myth.
Our customers are mostly dedicated online shoppers. They do not examine Aqualisa products in showrooms. We know this because we asked them. More than 1,000 Aqualisa shower buyers responded to our survey and 93% had never seen the product anywhere, other than online, before they purchased.
The “showcasing of Aqualisa products” that Richard refers to so proudly is often little more than one or two out-of-date shower boards on the wall of a tired retail shop. Despite what showrooms would like the brands to believe, twiddling the control knob of a dummy shower valve is not the consumer experience that drives the sale.
Consumers don’t need to “showroom” in 2018, many are experienced internet shoppers and very happy to buy online with just a good picture and a comprehensive description. They get all the technical information they need, they can read reviews from other customers and they know that if they don’t like it when it arrives, they have a 14-day legal right to return it for a full refund.
To prove the point beyond any doubt, 98% of the sanitaryware, bathroom furniture and shower enclosures we sell are house brands – not on display in a single showroom. It is literally impossible for these products to be “showroomed”, but we still sell several million pounds of them every year.
On the other hand, 95% of the people who research products on our website don’t buy from us. Many of those will eventually end up purchasing from a merchant, a DIY multiple or a local showroom instead. This process of researching online and buying in store is called “webrooming” and, according to recent consumer surveys, is much more common than the KBB bogeyman of “showrooming”.
The latest AMA market research confirms that only 12% of the showers market is taken by online retailers. Clearly, there is still a large group of consumers who prefer the benefits of the physical channel over the convenience and price competitiveness of shopping online.
This is not surprising, given that showrooms like More Than Baths have many advantages over online retailers that are difficult, if not impossible, for us to overcome.
There are many customers who are not comfortable dealing with a business they don’t know, often based hundreds of miles away. Some customers are uneasy about using their credit card over the internet, or not being able to take a faulty product back in person if something goes wrong.
Some customers want it today, or can’t afford to lose a day’s pay to wait in for an online retailer to deliver it sometime tomorrow.
Other customers want their bathroom project-managed from design through to installation and want the comfort of knowing that the selected products will all be compatible. These are the bricks-and-mortar showroom customers that will never buy from an online retailer.
There are also a significant number of online customers who hate visiting showrooms. They hate driving in heavy traffic, they hate struggling to find somewhere to park, they hate talking to assistants with little or no product knowledge. They particularly hate it when showrooms don’t invest in any stock, so they need to order it, forcing them to waste a second weekend repeating the whole ordeal.
The fact is that online retailers and showrooms are not competing for a common group of customers. There are internet customers, who prefer the online channel and there are bricks-and-mortar customers, who prefer the showroom channel. Purchasing decisions are not just about price.
Richard says: “If we don’t show it and educate clients on the ranges available how will they know about the product? It’s a rare occasion a client comes in and demands Aqualisa.”
Well, if that is true, why isn’t he doing what a good showroom operator would do – advise these clients on the benefits of investing in the premium ranges of Aqualisa products that are only available through showrooms, such as HiQu, iLux, Infinia, Rise, Futori and the Q Edition ranges.
We would love to have the opportunity to offer these Aqualisa products to our customers.
However, despite spending close to £3 million on Aqualisa products this year, and over £100k advertising the Aqualisa brand online, we are not allowed to sell them. These ranges are reserved exclusively for Aqualisa showroom customers.
The biggest mistake any brand can make is to try to protect their traditional showroom customers by refusing to engage with the rapidly-growing online market. Trying to turn back the clock with selective distribution agreements designed to force consumers back into showrooms simply won’t work. The inevitable result of that strategy is to surrender market share to those competing brands that do engage with online retailers.
It is a difficult balance for any brand to strike, but I think Aqualisa are doing quite a good job of balancing the conflicting interests of their different customers.