TruServ unveils ad plan for True Value banner

Home Channel News, Oct 25, 1999 by Kate Griffin

LAS VEGAS -- TruServ officials used the opening of the co-op's largest market ever to reveal a $30 million national advertising campaign that will promote the True Value banner under which the buying group intends to unify its membership.

"For too long, we've diluted the strength of the merger by having three retail identities," said TruServ CEO Don Hoye about the two-year-old union of Cotter & Co. and ServiStar Coast to Coast. "This move creates the largest retail hardware chain in the world. If every store changes, we will exceed our goal of more than 8,000 stores, putting us in the same category as a Burger King, Ford Motor Co. and Taco Bell."

TruServ's four-day Fall market, held here through Oct. 4, included an emotional farewell from Dan Cotter, who called on members not to resist change. "Your 25-year-old daughter is going to see your products in different ways than you do. Your son's perspective is more like that of tomorrow's customer than yours," said TruServ's chairman, who will retire from the co-op after 50 years in the industry.

Hoye insisted that TruServ's decision to drop the ServiStar and Coast to Coast banners would provide those dealers with an opportunity to sell a nationally recognized brand of paint. The decision also coincides with the co-op's move towards online shopping. "Since shoppers can't touch or feel merchandise, brand is even more important."

Both Cotter and Hoye acknowledged the emotional ties that many dealers attach to their store identity. "It's as bad as a divorce after 50 years," Hoye quoted one Pennsylvania member from whom he had received a letter. "The move to one identity did not come easily and it will not come overnight, but it will come by spring." Hoye called the decision vital to maintaining the co-op's long-term competitiveness.

Several ServiStar and Coast to Coast members interviewed by NHCN welcomed the move, saying the True Value name already has more name recognition than the two identities being dropped. However, one ServiStar member expressed disdain for the move, showing an NHCN reporter a note he'd scribbled to a colleague that read: "Join John Madden's team!" a reference to the pitchman for rival co-op, Ace Hardware.

E-commerce pushed

In preparing to step down, or hand over the "hammer, wrenches and screwdrivers to a new reign," Cotter urged members to reinvest in the business by remodeling and refixturing stores, perhaps as often as every five years. "We need your support and involvement," said Cotter, the first of several TruServ executives who urged members to increase their purchases through the co-op. "I don't have to tell you how Agent Orange has defoliated the independent's market in so many communities, how the battling among the big boxes for market share and ego have strewn the landscape with economic casualties."

Now that TruServ has standardized its product assortment and has established a single number system, members should realize all of the promised merger-related benefits early next year when TruServ completes the consolidation of its co-op's distribution network. "I know that those of you involved in the distribution changes in the East aren't seeing that today, but your fellow members in the Midwest and West have gone through it and now have outstanding service levels," Cotter said.

Brian Schnabel, the co-op's executive vp-business development, urged TruServ dealers to hop on the wave of e-commerce. "More than 3,000 of our largest members are using membersonline.com -- you need to increase your accessibility." The co-op, which has assisted 600 members to build their own Web sites, plans to offer planogram technology through its member Web site, ridding dealers of "all the paperwork that we have burdened you with," Schnabel said. "We'll kill fewer trees."

(Schnabel added that he was surprised to learn upon joining the Chicago-based co-op that "behind the Chicago Tribune, [TruServ] was the single biggest user of paper in Chicago.")

Over the next several weeks, TruServwill hold its third electronic auction, selling off discontinued product or excess inventory to members online, Schnabel said. Future auction Web pages will include full-color images of the merchandise being sold, he said.

In addition, TruServ will relaunch its consumer Web site, with a complete store locator program. "In the very near future we will launch an electronic commerce element to it," Schnabel said.

TruServ also unveiled a new wood care center at the market attended by more than 9,000 people from more than 3,000 stores.