January 03, 2018

Buy!!

There are several trends in the "Buy!!" quadrant.

The first trend is the obvious one ... catalog holding companies purchasing distressed catalog brands. There are a handful of catalog holding companies, and there are a handful of private equity folks who are active in this quadrant.

The second trend is less obvious, but equally important. It's an old-school trend ... the creation of separate brands. Think of it this way. There is a probability of your business having a bad year ... your merchants aren't perfect and your marketers aren't perfect ... so when both have a bad year, you put your business at risk. Your odds of staying in business decline. The single-brand deals with these problems all the time. Eventually, you go bankrupt. But if you have four brands and one has significant problems, you have three brands that might be succeeding and that reduces your risk. And you might have one brand that is utterly thriving, allowing the other brands to learn and change.

The third trend isn't happening yet, but it may become a necessity. If you aren't going to buy companies and diversify your portfolio, you can create a "Portfolio of the Willing" ... a family of non-competitive brands that share their practices in an effort to help each other grow. Look at the list of catalogers below ... this would be a "Portfolio of the Willing".

  • Vermont Teddy Bear.
  • Garrett Wade.
  • Lake Champlain Chocolates.
  • Littleton Coin Company.
  • Really Good Stuff.
  • SmartPak
These companies would meet monthly - sharing merchandising strategy, online marketing tactics, creative winners/losers, inventory management tips, results of pricing tests and free shipping tests and discounting tests ... helping each other develop customer acquisition strategies. One company might have a great modeling professional who builds models for the other companies ... one company might have implemented an ERP system and can help the other companies do the same ... you get the idea.

You can "simulate" being part of a portfolio of brands if you don't have the money to acquire distressed brands.

There are a lot of ways to participate in the "Buy!!" quadrant. Go make something happen ... do something!!

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