Major Industry Change re: Online Scuba Sales....

[redacted]

Also their mentatility might be if they get all their PADI affiliated stores online that they can have an edge over the other stores in gear sales. Since people most of time take additional classes at the brick-n-mortar shop where they buy their gear, it goes to say that the shop and PADI will have an advantage over other shops....

And those PADI shops that just hate the intertnet and all associated with it may change affiliation. That way, when they do go under, that won't be another PADI shop going out of business.

 

[ReefHound]

Not really. The shops you mentioned are still competing on price. Wegmans doesn't even bother. They're priced about average, but build their business on having better products and a much wider selection.

I don't think the grocery store analogy is relevant. We aren't talking about how an LDS can compete with another LDS, but rather how they can adapt and compete with a new species of retailer. Grocers don't really have an online competitor. There are some physical constraints such as refrigeration and freshness that do not apply to scuba merchandise. Online grocers are not like other online retailers - they are still bound to defined local areas and require local physical facilities.

Also, you *have* to visit a grocer every few weeks, whether it's Wegmans or Kroger or Safeway or whoever. So it's a question of which grocer do you choose? You have no feasible online alternative nor a "do nothing" alternative.

You don't *have* to ever visit your LDS. And for gear sales, you have feasible online alternatives. What exactly is a LDS going to do, if they are not competitive on price, to make a diver not even consider an online or "do nothing" option relevant? Maybe hire sexy girls to serve free beer? Actually, I can think of a few but they would probably require a more radical change and cost the LDS more than simply matching the online price. One thing is for sure, neither the punitive methods of badmouthing, blackballing, and bullying the diver who buys online nor the scare tactics (where will you get air fills?, how safe is that regulator?, etc.) have not been effective.

 

[mike_s]

And those PADI shops that just hate the intertnet and all associated with it may change affiliation. That way, when they do go under, that won't be another PADI shop going out of business.

It's ironic that most shops that blast internet sales still have a internet site that says who they are and how to find them, and maybe what they sell. They just don't offer click-to-buy purchasing. So they use the internet (for advertising their store), but blast it when it comes to sales. too funny.

They might change affiliations like you say, but I bet most don't. I imagine that most will just whine instead of doing anything pro-active, including changing agencies or starting their own internet based storefront.

For most small shops it would be difficult to change agencies because it would require retraining their instructors, dive masters, etc. That and who are they going to change to? another agency they've spent the last 10 years bashing? That makes them more of a hypocrite.

 

[JungleJoe]

The mom and pop model is going to go away, then where do you get your air ????


It's too bad the manufacturers wont let their authorized dealers sell on the internet and advertise whatever price they want and let the market set the price. And it's too bad that the manufacturers lie to their dealers, and sell direct to places like LP...

sad sad sad..

 

[mike_s]

The mom and pop model is going to go away, then where do you get your air ????

Well my Mom and Pop dealer is where I get my air at my local LDS.. I hope he doesn't go away. But he's "converted" and sells online now. In fact, he's the one who started this thread.

But I see your concerns. Many mom-n-pop dealers have gone under in the recent past. In the last 8 years we've had almost 10 local dive shops go out of business that are within an about one hour drive of me. Most of them were poorly managed and were a poor excuse for a retail establishment whether they were a dive shop or not. They sealed the fate of their own demise.

It's too bad the manufacturers wont let their authorized dealers sell on the internet and advertise whatever price they want and let the market set the price. And it's too bad that the manufacturers lie to their dealers, and sell direct to places like LP...

sad sad sad..

Yes it is sad that they lie to their dealers. These manufacturers also lie to their customers.

While un-restricted advertised price might be better for the dive consumer, I think it'll turn the dive industry into a no customer service Walmart type industry. The Local Dive Shops will really suffer then. Many of the mom and pop shops that are barely keeping alive, either on their own or with internet sales, will suffer. Why? becuase the hugher volume discounters that do nothing but push a box will '*****' up the market even more. Then we will have trouble finding dive shops open to get air fills from.....

Take for example the Tusa X-Pert Zoom fin. It's a good example because it's a very popular fin and is highly rated in reviews. List price for it is something like $175 to $189 bucks. Do a google search on it and you'll have a hard time finding it for under $129. Why? because MAP for it is $129. Even Leisure Pro sells it for $129. But I've seen it for sale many times for $99 bucks, but typicallynever "nationally advertised" for that, since that's not allowed per dealer agreement. I've even been in Divers Direct before and they had it for $99 on sale, but on their web site that same day it was still $129.

As odd as that is.... I really don't know a solution that won't turn the market into a worse market than it is now.

 

[Web Monkey]

While un-restricted advertised price might be better for the dive consumer, I think it'll turn the dive industry into a no customer service Walmart type industry. The Local Dive Shops will really suffer then. Many of the mom and pop shops that are barely keeping alive, either on their own or with internet sales, will suffer. Why? becuase the hugher volume discounters that do nothing but push a box will '*****' up the market even more. Then we will have trouble finding dive shops open to get air fills from.....

I think it will actually be good for the remainig dive shops.

They can sell training, service and air, none of which can be done over the net. This will also free up a ton of money they had tied up in inventory and reduce overhead, since they won't need room for a sales floor anymore.

Also, once the above service costs are unbundled from sales, prices for training, repairs and especially air will take a big jump, so in the end, long-term divers who buy services frequently will end up paying more, while newbies who typically drop out after buying their first set of equipment will get a break.

The people that will really get hosed will be the frequent, long-term divers

Terry

 

[cerich]

Well my Mom and Pop dealer is where I get my air at my local LDS.. I hope he doesn't go away. But he's "converted" and sells online now. In fact, he's the one who started this thread.

But I see your concerns. Many mom-n-pop dealers have gone under in the recent past. In the last 8 years we've had almost 10 local dive shops go out of business that are within an about one hour drive of me. Most of them were poorly managed and were a poor excuse for a retail establishment whether they were a dive shop or not. They sealed the fate of their own demise.




Yes it is sad that they lie to their dealers. These manufacturers also lie to their customers.

While un-restricted advertised price might be better for the dive consumer, I think it'll turn the dive industry into a no customer service Walmart type industry. The Local Dive Shops will really suffer then. Many of the mom and pop shops that are barely keeping alive, either on their own or with internet sales, will suffer. Why? becuase the hugher volume discounters that do nothing but push a box will '*****' up the market even more. Then we will have trouble finding dive shops open to get air fills from.....

Take for example the Tusa X-Pert Zoom fin. It's a good example because it's a very popular fin and is highly rated in reviews. List price for it is something like $175 to $189 bucks. Do a google search on it and you'll have a hard time finding it for under $129. Why? because MAP for it is $129. Even Leisure Pro sells it for $129. But I've seen it for sale many times for $99 bucks, but typicallynever "nationally advertised" for that, since that's not allowed per dealer agreement. I've even been in Divers Direct before and they had it for $99 on sale, but on their web site that same day it was still $129.

As odd as that is.... I really don't know a solution that won't turn the market into a worse market than it is now.

There does need to be a certain ability for retailers to compete. Outside of the dive industry things are interesting as well.

Last weekend I was putting in some molding in a room I built, an hour into the job and my compound miters motor burnt out. Before I jumped in my pickup and went into the closest concentrated shopping area I could buy another that is 45 mins drive away ( I live in the country, think cow pasture behind my property).

The area I need to drive to has Home Depot, Lowes, Sears and the bargain Harbour Freight and Nortern Tools. I jumped online and Sears has a Craftsman 10" with laser for $89, normally $139, The rest had a non laser unit in the $69 to $89 range. So I bought the craftsmans with instore pickup. In store the same unit was $149, so not only was it on special online, it was also normally $10 higher..... I would not have paid the extra for the laser and name normally, except that it was a better unit and only $20 more than the cheapest unit I found.

Even the large retailers are understanding that each cust. will have different purchasing habits and pricing instore and online differently.

I can promise you that if I walk into Scubatoys and don't ask for a deal I wont get one beyond the pricetag on a single item unless I ask for it (same at Divers Supply or Divesports) but instore or online then a phone call I could negotiate a better price provided I educated myself prior. However I can be assured of a fair price at any of those dive stores which is what I believe along with the attitude of "we want your business" and "the cust. is doing what I would when asking for a better price" instead of "you cant buy air online" or the general attitude of your a bad person to try and save money.

That goes for virtually every purchase I make these days.

 

[plot]

My LDS is primarily an auqalung dealer, and auqalung requires all of their sells to be over the counter. Does that mean my shop is SOL?

 

[JungleJoe]

well yes your shop is sol unless they either form a dummy corp and sell online with that at a discount. Aqualung sells direct to LP too i'd bet.... It's sad like i said, that the manufacturer tell's it's dealers it can't do this or that, or sell a certain way, but will gladly take money and sell to a place that kills the small shops. They only want money, and sure places like LP can say I'd like 100 of this, and 100 of that, vs a dive shop where it's 1 of this 2 of that.

Still its wrong though...

 

[cerich]

My LDS is primarily an auqalung dealer, and auqalung requires all of their sells to be over the counter. Does that mean my shop is SOL?

actually no, online is NOT the be all and end all.

One of my most successful shops sell Oceanic, SP and Al, they do not sell online. The owner and staff are VERY enthusiastic and also OK with the internet. When a cust has an internet price in mind (even grey market) they always compete (yes they break some of their vendors rules, so I won't use their name) and normally are able to make the sale with a profit that still supports the shop. Strange showing they want to compete also means they virtually NEVER need to exactly match that lowest internet price...

They also offer every level of training from recreational OW thru Instructor (OW they offer both the "weekend course where they throw as much staff as needed at the numbers of students and "semi private course of max 4 people and at least an Instructor Trainer teaching for $150 more and flexibility on schedule". They also offer technical course's and great travel.

The convert over 60% of their Open water students into a full set of gear and 80% into continuing education.

They will gross over $800,000 this year and they will only do ~140 open water students.

To put this in perspective I have shops doing the same # of students that will gross in the $250K range and even shops that do 300 students that will not gross more than 500K.

The owner of this shop NEVER bought into some "rules" that many in the industry have believed to be truths.

In fact sometimes I'll have dealers call this guy and discuss the market today, after all I'm just a rep that is saying the opposite of what their other reps are telling them and I must have an agenda so why listen?