In the digital era, Cineplex President and CEO Ellis Jacob has kept his company ahead of the curve by diversifying the business and embracing change.
By investing in powerful online technologies, Live to Play Sports’ John Williams is helping independent bike dealers successfully exploit the growing interest in cycling
John Williams took a big risk in 2012. Williams was President of the venerable Canadian cycling brand Norco, legendary for popularizing BMX and “North-Shore riding”-style mountain bikes. The Port Coquitlam, B.C.-based company had always had two successful streams to its business: Norco Bicycles, with a full line of “playground to podium” bikes, and Norco Products Ltd., which served as a distributor for almost 90 bike parts and accessory brands across the country. Although the name Norco carries significant weight in the marketplace, the management team decided that it was time to give the distribution side its own identity and bring a greater consumer-oriented focus to the bike line. So, after nearly 50 years as Norco, the organization became Live to Play Sports Group Inc., popularly known as Live to Play or LTP; Norco would be a name reserved for the bikes alone.
Transitioning a well-loved brand isn’t easy. Inside the company, the team needs to adapt (even enthusiastic supporters of the change get attached to their e-mail addresses), and it’s even tougher to win over independent dealers. But in the age of Amazon orders and Internet-powered consumers, it was a necessary shift for Norco, allowing it to focus more sharply on its bicycle line and to develop strategic systems for its newly branded parent distribution company.
LTP deals exclusively with independent bicycle dealers (IBDs), many of which compete not just with each other but also with a cultural change that sees consumers bypass the brick-and-mortar store altogether to shop online. “We believe there’s still tremendous value for a distributor, but that role has changed,” says Williams, who joined the company in 1998 and has been President since 2008. “The majority of information is gathered by consumers before they even step into the store. So, as a distributor, we view our role in LTP as connectivity. We want to connect consumers to brands, to dealers, to draw the traffic into the store and help dealers grow their business through the online channel.”
LTP took a multipronged approach to building success for its model. Brands are categorized as tier 1 – if LTP is the exclusive Canadian distributor – or tier 2. The former benefit from LTP’s on-the-ground sales force as well as print marketing, solicited product reviews, and an information push to consumer networks such as newsletters and social media. Tier-2 brands receive a more transactional, basic service: LTP ensures quick and efficient fulfilment when a dealer places an order. The system maximizes resources to focus on the brands that are the top sales drivers, and the results have been impressive, with double-digit revenue growth in the 2014 fiscal year.
The company has also partnered with SmartEtailing, Inc., a Camarillo, Calif.-based group that gives IBDs the ability to build their own websites, including story ideas, product information, tech tips and regular updates, as well as offer online shopping. Through SmartEtailing, an IBD can sync the inventory it has in store with what LTP has in its warehouse, creating a much larger opportunity for a sale.
“The dealers have anywhere from 2,000 to 6,000 square feet. We have over 20,000 products here,” Williams says. “They don’t have the space to show all that product in their stores, but with SmartEtailing, they can have this endless-aisle concept on their website. They can show everything that brand has to offer, because it’s synced with our inventory.”
When a dealer receives an order in its “warehouse” – essentially LTP’s stock –LTP sends it to the store or straight to the customer’s home. “We’re seamless behind the scenes,” Williams explains. “The dealer still maintains the relationship with the consumer.”
The partnership with SmartEtailing also lets LTP connect IBDs with brand websites more readily, through a “Buy Local Now” initiative. “When the consumer starts their purchasing journey, they often start at a brand’s website,” says Williams. “You gather all the information; you look at the reviews; you look at the consumers using that product. If the brand subscribes to Buy Local Now, you can click a button and it will show all the dealers who actually have that item right now in their store or in our warehouse.” The customer can immediately order straight from the dealer, allowing IBDs to compete better in an Amazon world.
“That’s how we talk about connecting consumers to brands to dealers in the online world,” Williams says. “We have this omni-channel experience – the in-store experience complemented by an online experience. That was our vision, one of the drivers behind the creation of LTP.”
Choosing which brands become a part of the LTP group is just as important to the company’s success. “In the past, it was often an arms race to see who could have the thickest book, among distributors, to get more and more brands to add to their portfolios,” Williams recalls. “You’ve got a deeper book, but then you weren’t giving enough attention to any one brand.”
Now LTP is a lot more selective when it comes to brands – and quicker to cull one that isn’t performing. “When we look at a brand, we want brands that not only manage their product portfolio and their market and their messaging, but also manage their pricing,” Williams continues. “How often do you see something advertised on the Internet and wonder, ‘Why am I paying so much in Canada?’ We want to avoid those conversations. We need brands who are very strategic in managing their pricing on a global basis.”
Although LTP’s non-proprietary brands are distributed solely within Canada, its three proprietary brands – Norco, Axiom (bike accessories such as racks and panniers) and Adams (“Trail-a-Bikes” for children) – sell worldwide and offer the company its biggest growth opportunity. “Last year was the first year we sold more Norco bikes outside of Canada than inside,” notes Williams. “Sometimes to be successful in Canada, you need success outside of Canada.”
The proprietary brands are distributed in more than 30 countries, including most of Europe, as well as New Zealand, Australia and China; Germany’s booming bike culture led to the opening of a branch office in that nation in 2013, complete with a direct sales force.
As complex as LTP’s marketing and promotion strategy is, the mission and vision are simple and direct.
“When we created LTP, we sat back and thought about our brand identity. ‘Why are we here? What’s our mission?’ And we believe that through cycling, our lives our better,” relates Williams, who does a 30-kilometre route twice a week. “We believe everyone is a cyclist. I think a lot of people can remember the time when they were rid of their training wheels, and the first time they rode down the road without any assistance.
“So that’s our vision. It’s creating more touch points for cycling through LTP. It’s about connecting those cyclists to brands, to dealers and all the information we need to cycle.”