In their effort to woo the department-store market, vacuum-cleaner vendors are increasing advertising and in-store demonstrations. Beyond offering a sharp price and margin, manufacturers also must pull customers into a store.
If manufacturers don’t do the best they can on margins, we won’t be in business,” said Dan Whitney, assistant buyer for Jordan Marsh. “But ad dollars are always a big help.”
The buyer from an East Coast chain also attributed the success of Royal this year to ad dollars. “There’s no doubt that their ads are pulling people into the store,” he said.
Another buyer added that aside from ad materials, vendors should concentrate on more demo support. “You have to sell them when you have them in the store,” he said.
When Electrolux developed its concept of direct selling through retail outlets, a cornerstone of the program was and still is in-store demonstrations.
“Whenever you have an extremely upscale product like ours, you have to give consumers a test drive,” said Stephen Cooper, senior vice president and general counsel for Electrolux. “You have to show them why they should spend x-amount of dollars more than they would with other models.”
Although Electrolux’s business is primarily in canisters, its upright business has been expanding.
“While uprights represent about 60 percent of the business, we were always stronger in cans,” Cooper said. “Now that spread is getting to be a lot less than it used to be because the consuming public is getting used to the fact that we sell uprights.”
Some vendors said part of the reason they have not gone after department stores as aggressively as they would have liked to is the issue of advertising support.
Panasonic, while firmly entrenched in other channels, is not as recognized in department stores as the company would like to be. But it is not due to a lack of upscale features on its vacs, according to Dennis Eppel, national marketing manager for vacuums.
“Department stores look for a lot in the way of ad dollars; they also want to protect their margin,” said Eppel. “Once we get into a full production swing at our Danville facility, we’ll be looking at attacking new markets more aggressively. I think we have to get out there more because we’re not a household name.”
Eppel would not speculate on when a model targeted at department stores might appear. He did say that the $100 price point is “very attractive for that market.”
Currently Matsushita, the parent company of Panasonic, is transferring molds from Japan to its Danville, Ky. facility. This month production will begin on the company’s 5000 series. Production of the 6000 upright series will follow in July.
The 5000 series features a triple filter with 12-inch agitation and a 6-amp motor. The 6000 series has a larger motor and 14-inch agitation. Suggested retail prices range from $119 to $189 for the 5000 series and $189.95 to $249.95 for the 6000.
While Eppel said the time is near for Panasonic to attack the department store trade more aggressively, the company is currently unveiling innovative upscale merchandise. One such product offered by Panasonic this year is its model MC6337 model upright. The unit has a carpet sensor with “fuzzy logic” that can measure the amount of dust and dirt taken in by the vac. If the amount taken in is large, the speed of the motor increases. If the amount of dirt is low, the opposite happens.
An LED indicator on the front panel of the vac has four lights; three red lights for varying degrees of dirt in the carpet, and a green light that indicates when the carpet is clean. The unit carries a suggested retail price of $299.
Knowing that mass merchandisers are still the largest channel of distribution for vacuums, department store buyers recognize the extra attention they’re getting from vendors. “I think it’s a matter of all vendors becoming more competitive in all market segments,” said the buyer from an East Coast department store chain. “The big boys are still positioned in the mass merchants, and that’s where the real meat and potatoes of the industry is.”
At the mass level, competition is keen. “It’s a given that competition at all channels has increased,” said Mark Normyle, director of marketing for Regina. “The inventory adjustments many mass merchants took combined with the pressure to reduce SKUs have people scrambling.”
Normyle said increased competition was one of the reasons behind Regina’s repositioning its upright Housekeeper line. The line was recently reduced from six to five SKUs.
“We wanted more of a differentiation between price points and features,” Normyle said. “It also helped us compete at key pricepoints by going feature to feature against the competition. Housekeeper uprights have a suggested retail price range between $79 and $149, said Normyle. The company has also upgraded colors and graphics to help differentiate between models, he said.
While department stores are said to have benefited from the soft economy and the increased competition it sparked, the down-swing in sales will not last forever. Recent figures released by the VCMA indicate an increase in February sales for full-sized vacuums. “I’m not saying that this industry is going to lead this economy out of a recession, but I think we have definitely turned a corner,” said Cooper from Electrolux. “Our direct sales business is coming back. Part of the reason is that we’re attracting more people that are willing to take a straight commission job and sell for us. But our salespeople tell us that there are more people willing to buy.
“With a direct sale, you get the to the customer before they have a chance to get to the store. It’s only a matter of time before those customers get into their cars and head to stores to make a purchase,” Cooper said.