How to Adopt a Direct to Consumer Model?

First, why in the world would you want to establish a direct to consumer model?  Selling single units on your website and amazon definitely won’t pay the bills, right?  No it won’t, unless you can sell single units to thousands at a time.

So why do it?  First, in any consumer product, it’s about creating demand…..and creating demand with the consumers that actually use or would use your product.  The old school philosophy of banging sales into retail is insanity at it’s finest. Same goes for trying to bang sales into a distributor. The end user isn’t noticing these efforts and the sales guys that you are selling to have hundreds of brands to sell…..are they going to push yours or sell what the customers asks for?  C’mon.

The plan is to lay the foundation.  

  1. Make sure you have logical fulfillment and warehousing options to handle any kind of direct to consumer business.
  2. Spend your time and effort creating consumer facing advertising and marketing.
  3. Create quality content that’s entertaining for your consumers (see blog on content design
  4. Customer acquisition should be spent on direct consumers, not retail sales leads.
  5. Save money forcing sales reps to make calls.  If properly executed, you can have an order taker collect retail P.O.s or even smarter, create a portal on your website to accept orders.
  6. Spend your dollars making your brand and products look amazing.
  7. Constantly be innovating with new products.

With the proper direct to consumer marketing platform enough consumer interest will be generated to create a situation where you can dictate your terms to any retailer.  There are brands out there, believe it or not, that have retailers begging them for product, yet they won’t sell to maintain specific branding and pricing standards.

This doesn’t happen overnight.  It could take a year or more to develop, however, creating consumer facing content that lives for an eternity on the internet will gain momentum with each new video or article that you post.

Fun Fact: I started a Soccer store YouTube page in 2013.  At first we didn’t get any hits on our videos and after a year lost interest in the business and it’s model but had 49 videos living on YouTube.  By 2015 the channel had over a million views (without posting any new content) and we are kicking ourselves for exiting the business. We were positioned to have a very highly rated YouTube channel and the sales would have undoubtably followed.

Moral of the story, grab the direct to consumer model by the horns and don’t give up!

3 Lessons on How to Retail Products in your Health Club

As a former gym owner I was fortunate enough to get an education from the school of hard knocks on how to sell ancillary items in my gym to increase my overall revenue. Owning a 24 hour key card facility added a layer of uncertain security with inventory but after we got past that there was even more we had to learn about being a retailer.

In your gym, you have to consider it like a retail store front. Anyone that enters is an opportunity to provide an additional product or service that they most likely are already buying somewhere else or online. The nice part about owning or operating a health club is that it’s a location that they can’t otherwise experience the benefits online.

That being said, this should open your club up to all kinds of retail possibilities.
At first we brought in powdered nutritional products (protein, pre workout, creatine, etc.) and pills (multivitamins, fish oils, etc). With a membership count of only 500 active members these items did not fly off the shelves.

Lesson Learned: not everyone will take these products, if you’re lucky 20% will try and 10% will take on a reoccurring basis. Most of these product come in a 30 day supply so plan your inventory accordingly and remember they have expiration dates.

The second category we explored was the RTD (ready to drink) drink cooler option. This was a success! The only challenges we faced was getting the drinks at a competitive price because our orders were on the smaller side and managing the inventory. In the evenings we used cash box and we sold drinks after hours. On the rare occasion our inventory didn’t match up and it took our managers extra time to reconcile the payments.

Lesson Learned: we should have offered cold drinks from the start and found proper inventory management systems.

Finally, we dabbled in gym accessories, shirts, headphones, shaker bottles, exercise bands, watches, shoes and shoe inserts. These we could normally buy at very aggressive prices and make a ton. Plus, if bought correctly, would never go out of style. It was a safe bet to inventory as it would always sell.

Lesson Learned: The one size fits all model is the way to go. Any clothing without dates written on them (ex. Fun Run July 4th 2016) only sell that day and never after. Lastly, keep it timeless, certain color trends don’t last very long, be sure to stay within the neutral zones especially if you are going to stock inventory.

The last tip is the power of suggestion. Just because you have product sitting in plain site doesn’t mean it will sell itself. Have your staff continually talk about what’s available and make precise recommendations for specific members. If executed systematically, you can add thousands to your bottom line every month.