Brand Born Online ---> When To Go Brick & Mortar?

[Zach]

Our brand is about 15 months old and has 100,000 customers all based on FB ads, shopify, and Amazon.

Our supplement business is churning, but like many others in ecomm we're really sick and tired of such a reliance on FB and their finicky algorithms and ad disapprovals. Right now is such a case. Months of prosperity and smooth sailing, but now the past 10 days have been total trash performance. Campaigns are off right now as I try to retool creative.

Anyways, we were approached by one of those places that will pitch & place your product to brick and mortar stores. They mentioned specifically Target, CVS, Walgreens to name a few to start with.

Based on the call, it feels like such a slam dunk thing to try out with 5,000 units or so. They said all the stores typically start small and work up from there.

Additionally, our product is pretty time-sensitive product. If people have a problem our product fixes, getting it in REAL TIME at the store is far superior than waiting 4-5 days for shipping. They want the solution NOW. Would you wait 4-5 days to get your "cold medicine" that you really would prefer to take right now while you actually have the cold? For this reason B&M is really interesting to us.

I'm sure someone else out here has experience with the pros and cons of B&Ms. What are some of the biggest reasons to be cautious of B&M? If done right, can this be more of a passive sales channel?

 

[becool]

You aren't describing what I view as brick and mortar. Brick and mortar's terrible, in my experience. If you can avoid it, you're usually better off. It can be fiscally devastating. I've seen it happen. A lot. However, what you're describing is not setting up your own brick and mortar establishment in order to peddle your wares. Rather, you're having someone push your product to an already established brick and mortar outlet (or outlets). I say do it. For the right products, that's an excellent way of obtaining additional revenue streams.

 

[Zach]

@becool

Yes, thanks for clarifying that. We have no interest in our own B&M. This is about the pros/cons to being in big department stores.

One risk/con the sales guy on the phone brought up is that places (he mentioned walmart specifically) are notoriously difficult to work with as they want to slash your margins AND if your product doesn't sell they'd like chargebacks for the space we took up on their shelves.

 

[becool]

@becool

Yes, thanks for clarifying that. We have no interest in our own B&M. This is about the pros/cons to being in big department stores.

One risk/con the sales guy on the phone brought up is that places (he mentioned walmart specifically) are notoriously difficult to work with as they want to slash your margins AND if your product doesn't sell they'd like chargebacks for the space we took up on their shelves.

They are a pain (particularly larger outlets), but if you can get a retailer to carry your products and it goes well, you just opened up another potential revenue stream - even if you are taking a hit in terms of your margins. Within reason, I'm generally a huge fan of the "pursue everything" angle. Why leave money on the table? Ultimately, you won't really know how it pans out until you try. For that reason, the sales guy is right/has a point.