Following on from last week’s story on the entry of ProMaster-branded photo accessories to Australia, we put a few questions to Bill McCurry (McCurry Associates), who has been representing the PRO group (owner of the ProMaster brand) in negotiations with new Australian distributor, Raleru.
Mr McCurry (pictured right) was a member and director of the PRO group as a retailer and is now an advisor to the PRO board. He is well-known in Australia for his regular and lively appearances in a range of forums at the annual PMA conferences.
The ProMaster brand is not known in Australia – where does it sit (premium? budget? ‘value-for-money’ etc)?
For smart, aspiring photographers, ProMaster provides a full spectrum of camera gear at an affordable price. People who purchase ProMaster are enthusiastic, active photographers who aspire to take better pictures. They value smart purchases made from a retailer they trust.
Where does PRO source the manufacture of products? Are they custom-made for PRO or re-badged, or a mixture of both?
Not to be evasive, but I don’t know every manufacturer of every product. I know there are some products that are worldwide exclusive to ProMaster as they are ProMaster design and PRO owns the dies to make the product. Other products are made by specialist factories.
Only the imaging industry seems hung up on these meaningless types of questions. The key is what are the standards of the product? What quality and support does the product have in the country where it is sold?
In Australia Raleru and the retailers selling ProMaster will be standing behind it with the best customer service/satisfaction policy in the industry. Look at the product and judge for yourself. It’s true; many products you see in stores today could be as good as the ProMaster equivalent. Overall, the customer will receive better value and a higher level of service through the ProMaster dealer system.
What proportion of the 2000+ SKUs in the ProMaster portfolio are we likely to see in Australia?
That 2000 SKUs in the USA PRO warehouse includes Samsung and Fuji cameras. The only product being distributed through PRO to Australia is ProMaster. There are about 1700 SKUs of ProMaster product. Currently all those products are available to the test stores. [There are three test businesses in Australia – Stallards Camera House, Tasmania, Croydon Camera House, Victoria, and FotoRiesel in Sydney.]
Once the results of the test are understood we can better determine what products will be make sense for Australia. They all could be available, if the market supports them.
Will ProMaster products be warehoused in Australia or despatched to retailers from the US?
For the test stores they are getting the full range of ProMaster from the US distribution centre. As products are rolled out by Raleru they will be coming factory direct, whether that factory is in the US, Asia or wherever the factory is. It’s a benefit of having Raleru being a warehousing distributor. Their volume warrants factory direct shipping, saving the consumer money and enhancing margin potential for the retailer.
How can stocking ProMaster accessories fight against shrinking hardware margins? Are margins for ProMaster products any better than offered by local distributors for their competing offerings?
Accessory sales are not a zero sum game. The consumer market is currently under-served and under-supplied. We all know of people who have had their camera battery die at the wrong time or had ‘memory card full’ messages. These are problems that would have been avoided had the retailer done a better job explaining to the customer why they must have a spare battery and additional memory cards.
With all the ‘consumer protection’ laws in Australia, it should be against the law to let a customer buy a camera without a spare battery and extra memory cards!
If you recall the PMA presentation John Swainston and I did in Melbourne two years ago . . . the research showed accessory add-on by Australian retailers was poor. The research we quoted showed in filter sales alone the missed sales were $6.6 million annually. ProMaster HGX filters have some unique characteristics. Promoting retailers will not only sell more filters they will have a higher average selling price. This increased top line growth and ballooning margin growth will help offset declining camera margins. US and Canadian retailers promoting ProMaster filters more than doubled the value of filters sold the first year. The initial Australian test stores have reported similar initial results.
In a recent visit to a large camera store the owner told me how they upset their long-term gadget bag supplier by bringing in a competing brand. The traditional supplier took a very mature approach and said, ‘We must work harder and do better to take care of your needs.’
One year later the original supplier had tripled the sales volume and the newer brand was selling well also. This should be the result ProMaster brings to the marketplace. The other brands should redouble their efforts to help retailers sell through accessories that benefit the consumer. ProMaster will increase accessory awareness on the part of the retailer. ProMaster will help the retailer with ideas and concepts to move accessory sales.
Think about tripod sales. Every tripod needs some type of remote shutter release to insure vibration free exposure. Most customers don’t know this. The accessory market is grossly under-served.
Cutting the price of accessories will not sell more. Educating the consumer how the accessory helps the picture taking experience is what will generate more sales. All accessory brands should see sales lift when they raise awareness of customer benefits.
In the US PRO is a cooperative of retailers – in Australia is it a more conventional distribution arrangement with profits shared between distributor – Raleru – and PRO as supplier? Is this the same as the Foto Source arrangements in Canada?
Camera House, Foto Source and PRO are all cooperative buying organisations with the same goal; creating opportunity for members’ financial success. Membership in any of these groups does not guarantee success. All these groups give to their members is the opportunity for the member to create the type of business they desire.
The groups bring a more level playing field when it comes to product acquisition. In the case of ProMaster they also get a brand they can promote locally to build repeat traffic to their store. It’s to some extent their own brand: Although there are no territorial exclusives, ProMaster is not found in every retail outlet.
Additionally, these groups can provide cost savings to vendors [suppliers] who use the ability to harness group support and effective communication to the members. These groups also have keen market trend insight that can help those vendors who want a front-line perspective to contrast with what their market research department offers.
Raleru will be stocking and rapidly replenishing retailers from their warehouse in Brookvale, NSW. Foto Source members are served out of the PRO warehouse in Hatboro, Pennsylvania.
Will ProMaster products be restricted to the photo specialty channel?
ProMaster realises to be successful in the marketplace it needs to be sold and promoted by local retailers who can influence the customer one-on-one. ProMaster does not invest in global marketing. Instead provide products at lower costs so the retailer can afford to invest in marketing at their local level to drive local sales. It’s what ProMaster calls the retailer’s ‘Natural Market Share’.
To date ProMaster has found only photo specialty stores have been capable of doing this. Because the brand is not well-known, price promotions do not work well. Consumer education is the key to selling ProMaster.
Reliable data is hard to come by, but I’d bet the average Camera House member does more volume per population than specialty stores anywhere else in the world. I was blown away by the volume numbers reported by retailers in smaller towns throughout Australia. They are probably 50-150 percent better than like population areas in the USA. That is a tremendous testimony to the power and success of the Camera House marketing machine. This enthusiasm will carry over to ProMaster products as well.
We put questions to Bill McCurry seeking clarification of Raleru’s intentions regarding supply to the broader photo specialist channel, which he suggested were best answered by Camera House general manager Paul Shearer. Unfortunately we did not get a response in time for publication.