How do products end up in stores?

For nearly 20 years I created product labels and packaging. One of my clients, John Matthys, was a great mentor and friend. One of the things he championed was real-life market testing.

What is market testing?

The traditional way to test customer response was with focus groups.

Focus group testing enlists qualified participants who meet certain demographic criteria (age, gender, income levels, etc.). They’re assembled to view and respond to visual, conceptual, or theoretical goods or situations. Clients and research analysts often will watch through a two-way mirror, while participants offer feedback that helps companies anticipate how their products or services will perform.

It’s very expensive.

John realized the huge amount of money his company was paying to conduct focus groups exceeded the cost of actually producing products and placing them onto store shelves. What better feedback is there than getting real-life responses from his actual customers? So that’s what he did.

Market research and intuition

At our store, Alki Surf Shop, my husband, David Horsfall, and I have employed John’s strategy with many of our products. In addition, we also pay attention to trends, and stock inventory compatible with our store’s retro-modern brand and encompassing “Seattle, surf culture, beach and fun.”

Recently I spent four days at the Seattle Gift Show (pictured above). Shows like the Seattle Gift Show are for retail stores and businesses that sell merchandise to consumers. They are not open to the general public. There is an eclectic group in attendance. It’s akin to belonging to a special club where the members have something special in common: they’re all kind of crazy. I say that because retail is not for weenies. There are many easier ways to make money, but they’re maybe not as much fun.

I personally don’t enjoy shopping for sport. So if I find something I like, I’ll buy 2, 3, or even 9 of the same exact thing.

But the gift show isn’t like shopping for yourself. It’s more like you’re shopping to buy something for a friend, but you don’t know who the friend is, and you don’t know what the friend likes.

So you end up choosing things that you like, or imagine THEY would like. It’s a bit like mind reading. David often says I’m prescient. However, when it comes to buying for retail, it’s a semi-informed roll of the dice.

Shopping to buy for a store is hard work. We have ideas of what we might want, then search through myriad vendors and options. We compare sources, prices, quality and terms. Then if we decide to sell an item, we order it, price it, add it to our inventory, merchandise it, and track its sales.

Our real-life business education

As retail storeowners, we meet many nice, friendly people from all over the world. The flip side is, we devote so much time to nurturing this thing we’ve birthed, it leaves us with just a fraction of the free time we once had. That means we are spending much of our time with strangers, rather than family or friends.

That being said, we’re fortunate to have friends who are also fellow store and restaurant owners. They understand the relentless work it takes to make a business like ours succeed. They’ve shared their experiences to help us avoid mistakes, and generously given us great advice and support.

There’s a widely quoted statistic attributed to Bloomberg, that says eight out of 10 entrepreneurs who launch businesses fail within the first 18 months. Having recently passed that milestone, and seeing our sales increasing year-over-year, David and I feel slightly more confident about what we’re doing.

It’s a continual learning experience that’s both challenging and fun.

See how it all comes together

We’re gearing up for spring and summer and hope you’ll stop by if you’re in the area. We’ll have new items from the Seattle Gift Show on our shelves, and you’ll have the opportunity to be part of our real-life market testing.

There won’t be any two-way mirrors or research analysts. But you will be greeted with a friendly “Aloha!”

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Postscript

This blog post went through seven revisions and was written entirely on a Motorola Droid Turbo 2 provided to me by Verizon Wireless.

It was fun writing in a café with only the Droid, a Bluetooth keyboard and mouse, while curious onlookers stole glances!

You can learn more about the Droid Turbo 2, the smartphone with the unbreakable screen, by visiting Verizon Wireless.

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Disclosure: As a member of a great group of Verizon influencers, I’m invited to share my honest thoughts on cool products to use and test. No additional compensation is provided, nor are favorable comments promised. All opinions are my own.

All Photos @ Terri Nakamura 2016

More about Terri:

• Visit her store Alki Surf Shop
• Terri Nakamura on Twitter
• Alki Surf Shop on Twitter
• The Horsfall House on AirBNB
• More by Terri Nakamura