You wouldn’t know it from its advertising, but Jordan’s is a furniture store local to Boston. And a rather successful one too. Always near or at the top of national lists for most sales per square foot in the retail furniture business. So profitable, it attracted the attention of the Sage of Omaha who bought Jordan’s with the expressed purpose of leaving a good thing alone. He wanted it to continue doing what it has always done: Act like anything but a furniture store while making money at a phenomenal rate.
If you didn’t know better, you might think Jordan’s was a movie theater. Or a theme park. Perhaps a restaurant. And when you got to know better, you would be right. That’s because Jordan’s realized early on that success in the furniture business first required success in the baby-sitting business. So they created stores that kids thought were way cool. A place where mom and dad would eagerly take them — and leave them alone! — for unadulterated fun. Mom and dad too thought this way cool. Because where else could they safely escape from the kids for an hour, and serenely spend their suddenly free time exploring an adult fantasy of their own? An Eden filled with rooms of perfectly arranged and accessorized furniture, all of which — when combined with a ready credit card and the relaxed sales resistance of couples floating in what feels like homes for their dreams — could be delivered whole the very next day?
Without jumping ahead, I know you already know what makes Jordan’s successful. And what you can learn from their example. The brothers Jordan asked “what business are we in?” And the right answer was show business. Entertainment for kids to be precise. A perfect, powerful synergy — because kids, most of all, drive the demand for furniture. You buy it when they’re born. You replace it as they grow. Again when they ruin it. And once more when they move away — free at last to repeat the same cycle.
Summon the gods and you’ll learn “What business are you in?” was most famously asked by another great sage, Peter Drucker, back when the earth was flat. It transformed the world of marketing — to this day. For example, Starbucks discovered recently, among other things, they are in the music business. They use that truth to attract customers who not only gather ’round five dollar cups of coffee, but drive CD sales to such a high note recording companies like Capitol can launch artists like Corinne Bailey Rae directly from Starbuck’s counters. Hess is another who discovered, as far back as the 1960s, that at this time of year they’re in the toy business. When everyone has to buy gas at commodity prices, why not let the tradition of a new collectible drive dollars to their pumps? Batteries included indeed.
Recognizing what business you are in allows you to out-position (something Russell talked about) and out-pace your competitors who — poor misguided devils — think they are merely in the business of selling real estate. Which is the last thing you want to be doing.
Last because customers who eventually buy and sell homes are first interested in all sorts of other low-barrier businesses you may wish to enter on their behalf. Like the self-storage business. Or the interior decoration business. Or the tourist business. Or the handyman business. Or the “how-do-I-get-my-kid-into-college?” business. All fairly distinctive activities of people who will soon be ready to make moves in real estate.
I’m sure you can easily and quickly think of a half dozen other business you, as a realtor, may actually be in. But “low barrier?” It’s not as if you will be opening a movie theater in your office anytime soon. Or serving up half-caff cappuccinos. Or granting legacy admissions to MIT.
But given an hour, there are several things you can do that could be about as effective for you as IMAX is for Jordan’s. CDs are for Starbucks. And fire trucks are for Hess.
You could go online and find the 10 best local links for people moving in and out of your area. The 10 best restaurants and boutiques to visit in your town. How about 5 great places to stay and another 5 fun things to do on a 2-day weekend vacation to your city. Or the 10 best names to know when fixing up a local home. Even 10 smart resources for parents with high school kids in need everything from test prep to scholarships to financial planning if they ever hope to get into State U.
With your links in hand, you could write an introductory paragraph for each topic telling why these are great contacts. And you could give each list in your collection a catchy title like “The Late-Start Guide to Getting Average Kids into a Good Colleges Without Going Broke!”** Subtitle it “One More Neighborly Service of Your Name Realty.” Do up each one with some flair as one-page documents you can post on your website. Then mouse on over to Adwords and — paying per click — offer them free online. Info-bait for buyers and sellers.
Remember, too, to print out hard copies for yourself because they make great handouts at PTA. And Cub Scouts. And youth soccer. And on history walks. Of course I’m assuming you are a PTA volunteer … and a pack leader … and assistant soccer coach … and local tourist guide … because — after all — you know well what business you really are in. Real estate.
Now it’s been said, “Those who can — do. And those who can’t — teach.” Which speaks to me as I, too, recently had to confront the businesses I’m really in. I found I’m in lots of them. Weight loss for women. Healthy hearts for middle-aged men. Tenure for assistant professors. World news for Americans too busy to keep up and too bored to pay attention. Daily updates for beleaguered family doctors. And breakthroughs in medicine for the high-priced specialists they always seem to recommend.
All of which is a long way from the real estate business — and a long explanation of why I have not posted here since an initial flurry when Greg announced me among his list of collaborators, if not conspirators (as some of the more, well, antagonistic comments would have you believe). I mistakenly — optimistically! — ignored the reality of my business and my capacity to do for you occasionally what I need to do for myself and my clients daily. So with this post, I’m headed home for the holidays. And there to stay, sticking to my knitting. Russell moves up … properly so: the cream always rises.
But while I won’t be writing for you, I will be reading with interest. And learning from those who can do.
____________
** all right, go ahead, engage in some puffery for prideful parents and call it: “The Late Start Guide to Getting Good Kids into Great Colleges*** Without Going Broke”
*** Colleges are good examples too of institutions that appear to be in one business but are engaged in another. It may look like the business of higher education from out here. But to the kids on the inside, and parents paying the freight, it’s the “make me a doctor or lawyer or architect business” … “find me a career or a mate or a clue business” … “bestow on me credentials or prestige or connections business” … You get the idea.
Greg Swann says:
I can’t tell you how much we’ve benefitted by your involvement. You proved yourself astoundingly adept at the webloggers art.
Inlookers, on top of everything Richard has to do to keep the doors open, he his relaunching his own web site, and then he’ll have his own weblog to worry about. Obviously we’ll be watching and linking to that. Even when he isn’t talking about real estate marketing, he is.
December 17, 2006 — 10:45 am
Doug Quance says:
I understand, Richard.
It’s difficult to run your own business… and your own blog… and blog on another website.
I have been playing catch-up for the last couple of weeks… so I know exactly how you feel.
BTW, another furniture store… Rooms To Go… is an example of a real estate company, in my estimation. I believe their business model is based upon paying for the real estate that their stores are located on. When the game is over, they will cash in on their great real estate and THAT will be the big payday. 🙂
December 17, 2006 — 12:52 pm
mike says:
re: Jordan’s
Deja vu … a few years years ago when I was living in New England and needed to furnish a new house I was buying, I was completely turned off by the salesmen, the quality and the prices at Jordan’s (same for Alpert’s).
I ended up buying everyting I needed at Cardi’s – all $20K worth – a furniture store which remembered that it was in the furniture business, not the babysitting or movie or amusement park business.
Maybe I was a unique customer; I was looking for quality and value.
Richard, do you have any profit figures on Cardi’s v. Jordan’s? That would show which business model is more successful.
December 17, 2006 — 1:17 pm
Richard Riccelli says:
No, Mike I don’t. But your point illustrates the beauty of marketing. For every position you take, there’s a position you leave exposed. And for Jordan’s it’s the “just-the-steak, hold-the-sizzle” and “there’s-no-such-thing-as-a-free-lunch” opening.
And I do know that Bob’s Discount Furniture and Bernie & Phyl’s* — who have filled that void in this market — are cleaning Jordan’s clock on entry-level, price-sensitive shoppers. The higher-quality, striver end is being taken more in Boston by the Crate and Barrels and Mohr & McPhersons and Mitchell Golds than the Cardi’s which appeals more to those in the Fall River, Providence and Worcester areas.
In general, I believe today’s consumer zeitgeist is working against Jordan’s and that their marketing model which worked well during late 1990s is playing, if not played, out. They will need to re-imagine themselves in relation to their customers if they hope to keep the affections of Mr. Buffett.
* the local joke here is which is Bernie and which is Phyl?
December 17, 2006 — 2:24 pm