Net-ting New Customers in Large Numbers
An amazing 85 percent of Sutton RV’s sales are Internet generated, most from outside its local market. The Eugene, Ore.-based Airstream dealership credits multiple online sources – including Go RVing – for generating leads that keep the business busy all year long.
George M. Sutton III likes to say it’s easy to grow a small business into a large one, but that it’s almost impossible to go from large to small. It’s a phrase he says with experience.
Less than 10 years ago, his family’s then-fairly new dealership, George M. Sutton RV in Eugene, Ore., was known for wide variety of brands and vehicle sizes, a mostly local clientele and a payroll that boasted 54 employees.
“The dealership had taken off like crazy and, within about three years, we went from virtually nothing, up to gross sales in 1999 that were $22.5 million,” he says. “All seemed good, except we didn’t have the financial wherewithal to survive a downturn. It was all speculation.”
So, when the inevitable came amid consumers’ Y2K fears and the slowing economy, Sutton found itself with $10 million of excess inventory. The inventory included Alpenlites and Teton fifth wheels, which proved difficult to sell in a down market; Fleetwood campers, which were not the newer models a local competitor was offering more profitably; and a variety of models from other manufacturers.
In 2000, the dealership’s sales had shrunk to $500,000 and it was struggling to pay its then-seven employees.
Sutton was hardly alone when it came to experiencing tough times that year. Two of his larger competitors – which had combined reported sales of $160 million in sales the year before – were forced to close their doors.
“We were destined to go down, too; but, through a combination of a lot of prayer, hard work and positive attitudes, my wife, Martha, and I managed to stay in business,” Sutton says.
Refocused After the Fall
Today, he describes it as one of the best things to ever happen to the business because it allowed the dealership to refocus.
“We managed to make our way back into the niche we liked best,” Sutton says. “We loved truck campers, which most RV people do not want to bother with. We also thought selling the top Ultra-Lite trailer made sense, while everyone else continued to sell the conventional products.”
Sutton decided to carry the iconic Airstream brand trailers in 2001. The manufacturer’s catchy looks are popular with legions of fans and Sutton notes that he is the only dealership in Oregon to offer the brand.
He says many professionals seek out the dealership because they want to use Airstreams as second homes. In addition, some celebrities, such as musician Eddie Vetter of Pearl Jam, use them as a place to write songs, or as mobile offices.
“They want something that looks cool and isn’t just any old trailer sitting out on their properties,” Sutton says. “They want something that makes a statement and having an Airstream definitely does.”
Through the course of the last several years, the dealership has grown to become one of Airstream’s top-selling dealerships. Sutton currently ranks second nationally in sales and the Suttons recently received an award for the dealership’s fourth-place ranking in 2006.
“Airstreams constitute about 45 percent of our business,” Sutton says. “Everything else is strong sales-wise, too; truck campers are popular and I have a hard time keeping T&Bs in stock.”
In the past few years, the dealership has reemerged as the top seller for T&Bs and a sales leader of Hi-Lo and K-Z units and Eagle Cap Campers.
Go RVing Fast Facts
A Booming Internet Generated Business
However, strong sales don’t always mean local buyers. Only 30 percent of Sutton’s buyers come from the Eugene area and, with 13 other RV dealers in his immediate vicinity, Sutton must actively seek out customers in other markets. In fact, 85 percent of the dealership’s sales are Internet generated and vehicles have been shipped as far away as New Zealand and China.
It’s common for Sutton to ship Airstreams to Alaska. In other cases, the dealership’s owners have personally driven vehicles to customers in Miami.
“We probably have 10 different website services that we use to help generate business,” Sutton says. “It’s a combination of hitting all the different targets, but people find us.”
One of those tools is Go RVing.com, the leads service promoted by the Recreation Vehicle Industry Association and the Recreational Vehicle Dealers Association.
“I would say that about 50 percent of our buyers are first-time buyers and the Go RVing program adds some sizzle,” Sutton says. “It puts the desire out there and it’s very good at instilling customers’ needs to go back to the things they did as kids and take their own kids camping. I camped with my father and I hear the same experiences from our customers.”
The dealership has been a member of the Go RVing program for several years. It’s not unusual for Sutton to receive 30-35 leads a month. The owner tries to send an e-mail to each potential customer immediately and then someone from the dealership’s six-person sales team writes each person a follow-up letter or e-mail. Sutton shies away from phoning prospects now because, in the past, some of them became defensive and concerned about their privacy.
Sutton has yet to determine whether participating in the Go RVing program has translated into sales yet, but says he believes participating in the program is worthwhile.
“(Go RVing) is not an expensive program and, if I get even one out of 100 prospects to purchase an RV, why not throw it into the mix?” Sutton says. “I also get leads from other sources, including some very effective ones from RV Trader Online and some from Redzia. I also get a lot from RV USA, which is huge for us.”
The emphasis on Internet sales means Sutton is able to sell products pretty consistently year round. The dealership carries between 160 and 225 vehicles at any given time.
“Christmas sales used to be nonexistent for us when we’re selling to people in Oregon,” Sutton says. “But, while most RV dealers lose their shirts during the Christmas season, I can come close to breaking even. We coast through the winter months by continuing to pitch and (having) people from other areas buy.
“It could be fathers who want to buy big presents for their families, or husbands who want to surprise their wives with Airstreams. It doesn’t matter; I can always sell a vehicle if I’ve got it.”
Print Advertising Brings in Customers
Sutton also works with Dan Ball, an RV advertising expert and the owner of Chardon, Ohio-based D.P. Ball Advertising, to reach a broad audience and advertise in many RV consumer magazines. Sutton credits Ball’s work with recent increases in the dealership’s sales from out-of-town buyers.
“(It was) the best summer in the 11 years we’ve been in the RV business,” he says. The dealership grossed $12 million in fiscal year 2007 and is projected to gross $13.5 million in 2008.
The advertising agency’s work has been so successful that the Suttons recently made the decision to stop attending most RV shows. At one Oregon show this year, the dealership brought 18 vehicles, spent $10,000 and still failed to sell any units at the show.
“We may have sold some units later because of the show, but I just decided that the same amount of money could be spent doing the same kind of stuff I am doing with Dan Ball and I could get 15 sales without having to go anywhere,” he says. “I always figure, why go to Mohammad when Mohammad can easily come to the mountain?”
Not that the Internet or national advertising in general will ever replace Sutton’s face-to-face sales.
The 4.5-acre dealership doesn’t have a showroom, which means vehicles are displayed outside and within view of the highway, so that potential customers driving by can see them.
“I never leave the vehicles in our inventory in the same spots for more than two weeks because I want people to notice that the vehicles have changed,” Sutton says. “They will notice.”
And Sutton, who comes from a long line of former Ford dealers, also makes sure there are no duplicate vehicles on the customer lots. Any duplicates are parked across the highway near the service area.
“When people get on our lot, we make as much effort as we can to ensure that units are clean, well marked and that everything is organized like what people expect to see when they are attending the shows,” he says.
And the dealership’s office decor is a mixture of western motifs, family pictures and rocking chairs on the porch to give it a homey atmosphere and to remind customers of their childhood days going to camp.
“One of the greatest things I’ve learned over the 11 years is to keep expenses down. So, instead, I’ve taken an old pull-through car wash and I’ve expanded it and converted it to an office building that’s warm and friendly.”
Focused on Parts & Service
But one area of the dealership that has had a fair amount of investment allotted to it in the last two years is the dealership’s service area. The 12,000-square-foot shop has room for nine units, with extra space available for two more.
The dealership employs four technicians, all paid hourly. The technicians, like the other 19 employees at Sutton RV, have their Sundays off.
“I find being closed on Sunday makes for happier employees,” Sutton says. “What we lose on Sunday, we gain on Monday when other dealerships around us are closed. We are also open late on Monday.”
He said the Eugene area has a lot of good technicians because a local college offers a training program and several RV manufacturers have operations nearby. And the dealership has sent many of its techs for additional training on how to service and do body work on Airstreams.
“With Airstreams, we are constantly called upon to do body work,” Sutton says. “When an owner dings an Airstream, he or she can’t have just anybody working on it. We’ve developed a really good following.”
But while the dealership gets daily deliveries from NTP and has a lot of dealings with Coast Distribution, Sutton says he’s mindful not overstock because during the “high-flying years” the dealership had about $250,000 tied up in parts purchases and things were always missing.
“We stock only what we have heavy turnover on,” he says. “Often when we deliver to a first-time buyer, they are going to need all kinds of odds and ends, such as hoses.”
The most popular aftermarket accessories are brake controllers, weight distributing hitches, airbags and solar panels. Favorite brands include Tekonsha Voyager and Prodigy brake controllers, Equal-i-zer weight distributing hitches and Firestone Ride-Rite airbags.
The dealership will wait until after the RVIA trade show in Louisville to decide what new aftermarket items to carry in 2008.
“We want to do everything to make sure the customers have a good buying experience and have something that will provide lasting memories for their families,” Sutton says. “People don’t have to buy an RV from us; we want them to want to.”