In preparation for future media and creative development for the pitch we would like to get an understanding of the Pool retail store market. Specifically we seek to learn the following: * drivers for decision making when deciding which retail pool store to buy supplies from
Consumers purchasing pool supplies in the United States make purchases from three types of suppliers: local businesses specializing in pool supplies, mass retail stores ("big box stores," such as Home Depot and Lowe's), and online retailers (such as Amazon). Seven drivers of purchasing behavior for pool supplies were identified: cost, quality of products, consumer experience, proximity to consumer, recommendations, online presence, and warranties. The drivers for decision-making when purchasing pool supplies may vary based on the type of business from which the consumer is making purchases. Below you will find a discussion of our methodology and findings.
In order to determine the drivers for consumer decision-making in the retail pool supply industry, my colleagues and I first evaluated the components of this market. We limited the scope of our research to the pool supply industry in the United States. In reviewing the available literature on this topic, we determined that customers have three options for purchasing pool supplies: local small businesses specializing in pool supplies, mass retail stores, and/or online retailers.
We then attempted to identify any pre-compiled data on consumer behavior in choosing pool supply retail stores from these sellers. Although our findings revealed no pre-determined data on this topic, we were able to construct a list of decision-making drivers by utilizing several options. First, we reviewed surveys and industry articles about pool supply dealerships, which provided insights about the factors that motivate consumers to select and later return to pool supply sellers. Second, we analyzed industry guidance for online pool supply retailers, which provided information about consumer behavior in this market that is relevant to both online and brick-and-mortar pool supply stores. Finally, we reviewed an interview with the owner of a pool supply store franchise, which provided additional information about consumer behavior, as well as the factors that the owner considered critical for success in this industry. While a typical Wonder request contains sources published within the previous two years, we included one source outside this time frame, as the information was reputable and has not been discussed in a more recent publication. Below you will find a discussion of our findings.
Overview of pool suppliers in the united states
While there is very little publicly available information on consumer behavior in the retail pool supply market, in reviewing the information that has been published on this topic, we determined that consumers have three general options for purchasing pool supplies. First, "local, non-mass-market retailers" are popular sources for pool supplies. The southeastern portion of the United States is the most popular location for pool supply stores, representing 27.5 percent of all brick-and-mortar retailers. Second, "big-box stores" are becoming increasingly competitive in this market, with mass retailers such as Lowe's and Home Depot selling pool supplies. Finally, online retailers are also becoming popular; in some cases, these retailers are local pool supply stores with online shopping features, and in other cases, consumers are purchasing products in large online marketplaces, such as Amazon.
We then evaluated consumer behavior among these retailers to develop a list of drivers for decision-making in purchasing pool supplies. Our findings revealed that these drivers often affect each type of pool supply seller differently. We identified seven drivers for decision-making in the purchase of pool supplies, discussed below in no particular order.
One of the most common perceptions about owning a pool is that "pools are expensive," and it is customary now for consumers to compare the costs of pool supplies locally and online before purchasing products. In some cases, consumers have already identified lower prices online when they enter brick-and-mortar stores, but in other cases, they may compare prices inside brick-and-mortar stores and request price-matching from local retailers. While cost is a substantial driver of consumer behavior in purchasing pool supplies, the popular belief that pool owners care only about supply costs is incorrect. However, research suggests that pool supply costs are more important for big box stores and online retailers than local, small businesses. The owner of one small pool supply store noted, “Pool stores live and die by the quality of their products, but big box stores live and die by price.” Big box stores and large, online retailers often have advantages in this area, as pool supply manufacturers offer reduced costs for wholesale purchases, resulting in lower prices for consumers.
2. QUALITY OF PRODUCTS
As previously noted, the quality of pool supplies is a significant motivator of consumer behavior, but it appears to be more relevant for small, local businesses than big box stores or online retailers. It is noted that approximately 60 percent of pool customers consistently buy supplies that have "earned their trust." In fact, many small pool supply retailers have found that some of their most loyal customers are those who have been "burned by low-cost, low-quality products," often purchased from big box stores and/or online retailers. In the pool supply market, "customers are nearly as loyal to chemical brands as the dealers who sell them." Local suppliers also have the opportunity when working with a new customer to offer superior products available in-store that cannot be purchased online or through big box stores.
3. CONSUMER EXPERIENCE
Purchasing behavior is often driven by a positive consumer experience, and local pool supply retailers have advantages in this area, including the ability to offer promotional deals and excellent customer service. Customers are often driven to local retailers after being dissatisfied with low-cost products purchased elsewhere, and the professional advice received from a local small business can become invaluable. While local pool supply businesses may not be able to compete with big box stores and online retailers for the lowest prices, they may very well be able to deliver superior customer service. Additionally, for locally owned and operated businesses, consumers may recognize that the business is operated by professionals whose advice is trusted and valued.
4. PROXIMITY TO CONSUMER
In one survey of pool owners, the majority of pool owners reported a preference for buying pool chemicals and other supplies from a "local, non-mass-market retailer." In fact, only six percent of pool owners expressed a preference for using an online retailer. Local retailers have some unique advantages over online sellers. For example, it is critical not to underestimate the importance of a consumer being able to physically handle a product when making a purchase. Additionally, some local pool supply stores offer benefits that are not replicated by other sellers, such as the ability to test pool water for free to determine which chemicals are needed, and offering other perks, such as free delivery of supplies.
On the other hand, the ability to enter a local pool supply store, handle products, and make decisions about purchasing may actually negatively impact local retailers. "Showrooming" is becoming an increasingly relevant trend in consumer purchasing behavior, and it primarily benefits online retailers. When showrooming, a consumer enters a local retail store and evaluates a product in-person. Once the customer verifies that the product is satisfactory, the purchase is then completed online, where the product is typically cheaper.
Consumers are increasingly influenced by recommendations from other customers and/or industry professionals when purchasing pool supplies, and our findings indicate that recommendations are important motivators for consumer purchases from all types of pool supply sellers. For example, small business owners may benefit from a local reputation as being "owned and operated by families within the communities they serve," and their customers have close, loyal relationships with staff there. On the other hand, big box stores and online retailers offer consumers the ability to consider hundreds of
online reviews from similarly-situated customers before making purchases. The ability to solicit recommendations from other consumers and industry professionals before making a purchase is critical in an industry with rapidly expanding offerings of products and services.
6. ONLINE PRESENCE
As previously noted, a robust online presence is critical in the pool supply market, as it is estimated that 97 percent of customers search for businesses online before making a purchase. Additionally, it is noted that the motivating behavior for a pool supply purchase for a majority of consumers is simply to conduct a Google search and then contact the first or second company in the search engine results. In order to optimize online presence, successful pool supply sellers offer information about the company's products and services, as well as marketing imagery that is designed to increase sales. Some sellers have designed their websites to become "one-stop" pool supply resources, offering consumers the ability to order products, make appointments for services, request sales consultations, and offer options to download buyers' guides. Finally, consumer purchasing behaviors are often driven by successful website and search engine optimization.
Although our research determined that warranties are not one of the most popular drivers of consumer purchases of pool supplies, warranties may be relevant when "sealing the deal" in some situations, particularly for local retailers. For example, particular pool supply brands may offer warranties on products purchased locally, and local retailers may also offer in-house warranties on some products. Warranties are not typically available from online retailers, although some big box stores may offer them.
In summary, drivers for decision-making when purchasing pool supplies may vary based on the type of business from which the consumer is making purchases. Seven drivers of purchasing behavior when making pool supply purchases include cost, quality of products, consumer experience, proximity to consumer, recommendations, online presence, and warranties.