Registering support: computers and data-driven technologies are proving to be retailers' best business resources

Pool & Spa News, May 23, 2005 by Julie Sturgeon

Successful dealers in the pool and spa industry swear by this fact: Technology is a godsend to the retail world. Just ask Craig Coleman, who still remembers his filing system, where he scribbled each customer's information on 3-by-5-inch cards.

Today the owner of Coleman Bright Ideas for Your Home in Fort Worth, Texas, relies on a database contact manager as well as point-of-sale and inventory-management software. He also has an e-commerce site where he sells additional product.

"We haven't really analyzed profits specifically related to changes in technology," Coleman says, "but if you don't embrace the changes, it's sure hard to maintain profitability."

Getting technical

Tim Armstrong is another convert. The sales representative for Fiesta Pools & Spas in Tulsa, Okla., also traded in his filing cabinets for a computerized database that holds information on 13,000-plus customers.

Armstrong estimates such technology has increased sales approximately 20 percent by helping him follow up on big-ticket items. And that doesn't even take into account the value of better forecasting on product movement and maintaining margins.

"In the old days, we would do some of that stuff, but it was manual, time-consuming [work], and there was always a huge fudge factor on what was actually out there," notes Aaron Temme, chief operating officer of Hallmark Pools & Spas, a San Diego-based Pool & Spa News Top Builder.

On the other side of the coin, technology does require an upkeep budget in the overhead cost column. "I remember the first information system we put in--a network in our business. We thought, 'Boy, this is a great thing,'" Coleman says. "What we didn't anticipate was needing to replace it about every five years. It's like getting on a treadmill that doesn't have a cutoff switch."

While technology may not be cheap, that doesn't stop retailers from wanting it. The National Retail Federation predicts that 2005 will be the year U.S. retailers stop drooling and start shelling out money for tools that promise tangible return-on-investment benefits in a short time frame.

Data integration, digital signage and radio frequency identification systems lead the parade of cutting-edge desires for the retail niche as a whole. However, the technology found on most spa and pool retailers' wish lists is typically more modest. Coleman, for one, counts himself among the buying bunch, but the extent of his current goal is to expand his POS system from two locations to all four.

That's because conservative spending still forms the bedrock of the pool and spa retail sector. Take, for instance, Hallmark's Web site. The firm jumped into e-commerce in 2001, based partially on customer suggestions as they chatted in the retail store. The current site is on a much smaller scale than the store, though. It excludes hundreds--maybe thousands--of items the store carries.

That may change in the near future. Temme is working with his Internet marketing company to kick it up a notch and spin the Web site off into its own corporation.

With somewhere between 3- and 8 percent of Hallmark's yearly gross sales stemming from e-commerce--mainly water toys, games, loungers, and items such as goggles and masks, so far--the strategy holds solid benefits for Temme and like-minded retailers.