If your Jeep customers aren't shopping for shirts, baby strollers and shockproof flashlights while they await maintenance on their vehicle, you could be missing an innovative revenue stream.
Rodney Plack, general manager of Landers Chrysler-Dodge-Jeep in Benton, AR, reckons his new 72,000-sq.-ft. store will do $500 a month business in wearable, carry-along merchandise alone in an area set aside for such sales.
“We cater to Jeep people — they are proud of being outdoorsy people, sporting their brand,” says Plack.
The new store was built after a tornado wrecked the old one. The rebuilding project added a full merchandise display department, kids' playroom and coffee bar.
Jeep is using Internet, elevator and newspaper advertisements to encourage people to buy a wide range of gear at dealerships. Products on display range from 85-cent antenna toppers to Jeep bicycles costing hundreds of dollars. Worldwide sales of Jeep licensed merchandise exceeded $400 million in 2003.
“Jeep is about freedom, adventure, authenticity and mastery,” says Jeff Bell, vice president of DaimlerChrysler AG's Jeep Div.
He says many owners like being ambassadors of a product, one in which they have driven to a Jeep Jamboree, along a challenging Rubicon trail or to an annual Camp Jeep where they hang out for three days with 10,000 other Jeep families. People pay several hundreds of dollars to listen to music performances, talk with engineers and shop for branded merchandise.
At Camp Jeep, one of the largest tents is its Jeep Provisions that attracts customers to a range of merchandise, including Jeep grilles, auto wax and sleeping bags.
Jeep brings in several semi-trailers full of merchandise. Nearly all sells out, especially with an announcer offering sale items on a sound system throughout the days. Some date-specific merchandise sells for even more on e-Bay.
“Jeep owners are incredibly loyal to their brand,” says Grant Griffen, CEO of Event Metrics. Jeep, produced for over 60 years, is one brand with enough equity to entice buyers to purchase products, says retail consultant Fred Marx of Marx Layne & Co.
“To the degree that dealer personnel have seen the designer influence and loyalty of car clubs, they look for merchandise beyond key rings, which is where it all began,” Marx says.
The Specialty Equipment Market Assn. maintains a website, www.semaphotos.com/merchandising.html, with hundreds of accessories that show dealers how to make point of sale displays out of even the obligatory parts purchases. Those sales stands range from countertop displays showcasing auto meter gauges to a full-line spread of Mopar Speedshop items to customize an auto.
Ed Bennis, parts manager of Blue Bonnet Jeep in New Braunfels, TX, displays baby strollers, tents and bikes in the dealership showroom to drive attention toward its parts department. Its Internet site advertises a “Texas-sized” gift and accessory store.
“Customers act like kids in a candy store. They want to be identified with Jeep and we provide them with a whole lot of merchandise to make them happy,” Bennis says.
Nearly everything Jeep offers, Bennis stocks. Hot items include radio controlled Jeeps, coffee mugs and camp fire kits.
“Nearly every parts department could sell more merchandise if it has enthusiasm to sell the products,” Bennis says. “A lot of parts managers look at accessories as something they have to do, not something that will add surprise and bring delight to customers.”
What stops some dealerships from getting in on this action? Dave Skrobot, a fixed operations consultant, says dealers often are hampered by a lack of merchandise display room, lack of expertise in merchandising such ancillary products, lack of knowing what to display and fear of being stuck with merchandise that does not turn over.
The fear is valid in some cases.
Tom Saigh, parts manager of Palace Chrysler Jeep in Lake Orion, MI, says the store's Jeep merchandising effort didn't work out, largely because the dealership is only a few miles from DaimlerChrysler's Auburn Hills headquarters.
Much of the dealership's business is with DaimlerChyrsler employees. “They already have access to Jeep-branded merchandise,” he says.
But overall, expect to see a lot more dealer involvement in merchandise, Marx predicts.
“Fulfillment is fairly easy,” he says. “You can order online, receive in a couple days. Most of the materials aren't terribly seasonal. People wear denim shirts and polo tops all year round. The coffee cups, chairs and lanterns seldom become obsolete, not like clothing and goods in department stores.”
The Bride Wore Black
Enterprising car dealers take a page out of the Harley Davidson book because its dealer network has been masterful at brand merchandising. Harley sales of items such as jackets, shirts, hats and wallets is nearly $250 million a year. Such general merchandise accounts for almost 6% of the motorcycle maker's annual revenue, up from virtually nothing in 1982, when Harley first began licensing products.
Harley even offers a wedding apparel line, including hats, garter belts, rings and guest books. As cash registers jingle, the rest of the dealer community awakens to the tune.
Sometimes it's a question of customers liking the logo but not being able to afford the real product.
Cauley Ferrari, the only dealership in Michigan carrying the high-end Italian cars, retails to a ready market in sweatshirts, shirts, leather briefcases, model cars and ashtrays.
“We sell a lot of merchandise to people who say they can't afford a Ferrari but can afford a model car,” says merchandise sales agent Anna Cavallo.
Catalog Goes to 3,109 Jeep Dealers
DaimlerChrysler AG has joined with the $9 billion global network of Diversified Agency Services (formerly BBD & O) and its subsidiary, Alcone Marketing Group, to launch Jeep Gear in dealerships, on the Internet and in freestanding stores in Europe, Asia and Africa.
Jeep has 10 free-standing Jeep shops in South Africa, one in Lisbon, Portugal, over 100 in Asia and one about to open in Bangkok, Thailand, specializing in apparel, bags and footwear.
Previously DaimlerChrysler ran its own merchandising arm as Jeep Provisions.
Alcone, a specialty merchandise purveyor with offices in Troy, MI, and Irvine, CA, distributes Jeep-licensed and unlicensed goods in catalogs to 3,109 Jeep dealers. The licensed merchandise is higher end stuff, often for consumer purchase, while the unlicensed merchandise may be small stuff handed out to customers who complete test drives, attend a local auto show or win in-dealership contests.
“If people buy from dealerships, they avoid paying shipping costs,” says Debra Swatosh, merchandising manger for Alcone's Jeep line. She encourages dealers to display merchandise in customer waiting lounges, showrooms and parts departments.