The outdoor category presents a massive opportunity to independent retailers of all shapes and sizes — and no one can explain why better than Nationwide’s own John Laing, director of outdoor.
Rob Stott: Hi, we’re back on the Independent Thinking Podcast here, live from Houston at PrimeTime, and right now getting an opportunity to talk with the guy that’s been busy at this show, I know, Mr. John Laing, our Director of Appliances and Outdoor. Appreciate you coming on and stepping away from what I know has been a crazy schedule for the two of us, so.
John Laing: Yes, been great though. Good crazy.
Rob Stott: Yeah. So first of all, how has Houston been for you? How has the time here at PrimeTime and in the George R. Brown Convention Center treated you?
John Laing: Yeah, I think it’s been great to come to a new venue. I think first and foremost for me because I go to a lot of PrimeTimes and it’s great to come to a new venue, I think both for our vendors, our members, and even the Nationwide staff to get a fresh place. The convention center’s been awesome both for my education standpoint and the facilities for our vendors and members to run around. And I would say the hotel situation, being all very close with restaurants and such, it’s really been a great venue.
Rob Stott: Yeah. And I can’t wait to sort of dive deeper into this, but talking to someone who knows the outdoor space pretty well, is there a better town with food to talk about than some barbecue and what they got going on in Houston? It’s up there, it’s up there.
John Laing: Well, yeah, there is a number of those that would like Memphis, Kansas City for barbecue but there’s only so many venues that can hold all of us, so. But yeah, this has been a great venue and, in fact, we had a chance to take in a pit master class on Saturday and it was an amazing class and really a fun venue. So my hope someday is that we can parlay that into maybe a Nationwide Learning Academy and do a class like that where members would come and have some fun but learn some stuff along the way
Rob Stott: Sign me up.
John Laing: Okay, all right.
Rob Stott: That sounds good. I can advocate for that.
John Laing: There might be a beverage involved with that too.
Rob Stott: Well, speaking of some barbecue and brews, you guys had, we’re sitting here Tuesday morning at PrimeTime, fresh off of the backyard, barbecue and brews. I know the weather in Houston didn’t cooperate too well for us. It would have been nice to have it outdoors but had to have it indoors. I don’t think it took away from the atmosphere at all. I thought it was a phenomenal event. But what did you think of last night and how everything went?
John Laing: Yeah, I mean it was making lemonade out of lemons, right? And I give a lot of props and kudos to our events coordinator. Sterling Events did an amazing job because we had to make the call Thursday night what we were going to do. And for safety reasons and for traffic reasons to get people out to the booths, we wanted to make sure that we had both of those covered. So to do that, it was moving inside. And I would say we probably had 15 or 1600 people come last night. And our vendor community jumped in, demonstrating, still they’re sampling food along with some great dinner. And then to have some fantastic entertainment. And we even gave back a little bit last night, I think, too, through Mike Whitaker’s efforts in coordinating that with Whirlpool and Traeger and some others.
Rob Stott: Yeah, that was awesome. But the serious question off the bat, did you get on the pig?
John Laing: I did not. I was advised by my doctor not to do that because I’ve got a lot of metal and broken bones so I didn’t want to do that.
Rob Stott: Understood. Understood. I did. I almost hate to admit that I did. It didn’t last too long, but it’s a really cool event to see that sort of come together on the expo floor, right next to the main expo floor. And the other side of it, and I know this PrimeTime, the February, March PrimeTime has traditionally been a time to showcase some of that outdoor stuff. So to see the… It’s a different experience because you get to see the product that’s on the floor in active use. I mean, these grills and kind of what they can do and you get to enjoy it as well with the food and all that sort of stuff. Did you have a favorite bite back there last night?
John Laing: Well, I loved Broil King’s brisket was fantastic. I didn’t sample them all. But I would say that was high on the list. I had some fantastic burnt ends from Traeger. Even some shrimp from a brand called Mont Alpi had some great stuff. But everybody put their best foot forward. And what I love about the grill space and being able to demonstrate from our members is the same message they can deliver on their own sales floor and outside the front of their store. It’s really appealing to all five senses and there aren’t many, if any, products in this hall that you can really touch all five senses except when you get into the grilling space. And so I’m a big proponent of having grilling and outdoor cooking and outdoor living as part of your assortment because of that.
Rob Stott: Yeah. And that’s an excellent point. I’m glad you brought it up because we’ve, independent thinking I know, your column actually called out an example or two of some retailers that are doing it well and showcasing that outdoor space. So, kind of what’s, to you, the pitch to some members that maybe haven’t either considered it or are starting to look into it in showcasing outdoor in their showrooms or maybe even outside of their showrooms, given their locations, to kind of get them over that hump and be like, “All right, yeah, this is something that makes sense for me.”
John Laing: Yeah. So I think first and foremost is to look at your business and say, “Okay, am I interested in getting into a category that I could make good money on? Am I interested in getting into a category that can attract potentially a new customer, attract a customer that might come back into my store multiple times during a year versus every seven years? Am I interested in a business that I can have a fun customer that’s actually interested in buying something and has a good attitude versus one that might be coming in to replace a product that has just died and looks at it as a dreaded time to buy something?” I mean, all of these things add up to a really great category and one that can really help not only expand their business, but expand to new customers they’ve never seen before and ones that will keep coming back for fuels, pellets, sauces, rubs, accessories, et cetera.
Rob Stott: Yeah. And it’s just a different way of thinking about it. And it ties in so nicely. I mean your title itself, Appliances and Outdoor, they integrate seamlessly. It’s one to the next, it’s a cooking category, for the most part. I love your description of you’re taking a completely different type of customer, one that appliance shoppers are typically, they’re not looking to upgrade an appliance. Don’t get me wrong, there are some that are looking to upgrade, but more often than not it’s a direct shopper. Whereas you think about outdoor spaces and buying for outdoors, it’s more of an entertainment factor.
John Laing: No question. I think, when we first started this initiative three years ago, we thought it was a pretty easy putt for our appliance guys to look at the outdoor kitchen area as a great way to expand their business, and it is. I mean, they’re used to selling indoor kitchens. It should be really easy for them to talk to a consumer about the outdoor living space but, frankly, what we found is that there are members that were selling only consumer electronics that have gotten into it because they realize they have the capability of selling entertainment outside. They, too, should look at this as an entertainment category.
Rob Stott: Yeah. It’s kind of like this hybrid living room, kitchen area because you got outdoor furniture that I know is coming up in this space. Yeah, yeah.
John Laing: Yeah, we’re going to go there next. Furniture dealers should be looking at it as an extension, at least being outdoor furniture, if not into certainly outdoor comfort. That’s a miss and I think that most people don’t see that category in patio flame tables and other comfort products that can make that environment both warm but also relaxing. That’s growing at 20% plus every year and it’s still a big opportunity with our members. But every specialist, whether you’re appliance or if you’re a furniture specialist, consumer electronics, even some mattress stores have looked at it now as an opportunity to make an extension of that consumer’s living environment. 59% of new home builders are now putting patios in homes. Many of them, and certainly the higher ends, are already putting outdoor kitchens in for those consumers. Millennials, everybody wants the millennial shopper, they’re willing to downsize their interior space as long as they can get that same feeling extended to the outdoor space and they’re a captive audience for this whole outdoor living environment.
Rob Stott: Yeah, no, that’s incredible. And certainly a huge opportunity to see it here on the PrimeTime show floor. So what is innovation in this space, in the outdoor space? What does that look like?
John Laing: Sure. Yeah, grilling has been around for a long time, whether it be starting with charcoal and then evolving to a gas type product. But over time, it’s become wood-fired lump charcoal as a fuel type. The most recent is pellet cooking. Been around for 25 or 30 years, but it’s really catching on and it’s certainly the hottest fuel type being sold today and it’s something that has to be replenished regularly. But the beauty on pellets cooking, it’s the safest way to grill because you really can set it and forget it, unless you’re babysitting some ribs that you want to spray a little apple juice on once in a while. It really is an easy and safe way to cook some fantastic meat. So that’s been the hottest thing, I think, in technology.
To that, about a year or so ago, a couple of our vendors, both Traeger and Louisiana Grills, now have added wi-fi to their pellet grills, making it even easier because it’s all cloud-based so that you can put your food on, get it started, and then go enjoy your activities for the day, whether it be mowing your lawn, going to watch the kids’ soccer game, going to the beach, and actually control the temperature from wherever you are in the world.
Rob Stott: Wow.
John Laing: It’s very, very cool.
Rob Stott: That’s crazy. So I mean, you see that, look at the indoor side of things, the ovens that you can kind of set or send a recipe to for example, and it’ll have the time and how hot it needs to be at a certain time and adjust throughout the day. So you’re seeing that sort of just start to weave its way into outdoor cooking as well?
John Laing: Yeah. So far, just pellet cooking has the wifi.
Rob Stott: That’s interesting.
John Laing: We haven’t figured out how to put it into gas products yet. But wifi is, and cooking remotely, is a cool idea and hopefully, we’ll extend. I think the other things that are coming, and I’ll put it in the innovation category would be cosmetic. So black stainless steel has been the most popular color inside the kitchen for four or five years. And now that’s being extended with a brand like Mont Alpi is coming with it. A brand called Titus is coming with it. Gives your grill a much different look, a very cool look, and your outdoor kitchen different look. One of our brands also has a thing that’s coming, I think it’s been developed in Europe. Another one of those European things that Americans will adopt but it’s actually a pre-rusted finish on part of the grilling mechanism that gives it a really cool finish and different and will stay that look forever.
Rob Stott: Interesting.
John Laing: It’s very, very cool.
Rob Stott: Oh that’s awesome. You kind of hit on a little bit earlier, the challenge being adoption in this space. Aside from getting more members to get into outdoor, interesting way to put it, get into outdoor, but what other challenges are there in this area and how is Nationwide and you addressing them?
John Laing: Yeah, great question. I think, first or foremost, when you talk to a member about the possibility of getting into a category, if they’re open to getting into a new category, the first challenge really is space. “Where am I going to put these products?” So I always challenged back a little bit and say, “Okay, let’s look at every SKU you have on the floor and tell me your return on investment of every one of those SKUs and I would bet you that you can justify some models that could come off and still not jeopardize your volume and profitability and open up for a new category.”
The average specialist, which I’ll put our appliance and our members into the specialist category, needs about 800 square feet of space to really look relevant in this business. So I always look to get around that 800 square foot number, which sometimes is tough but most of the time it’s not if you really look at your products. The second thing on space is that many times the outdoor frontage to a store goes untapped.
Rob Stott: Yeah, absolutely.
John Laing: So a lot of our members, good ones that needed that extra space, will roll grills in and out every night and put them back outside every night or every morning and inside every night and use them for display outside or they’ll figure out a mechanism to chain them up outside.
Rob Stott: Yeah, that makes a lot of sense. So looking ahead to 2020, we talked a little bit about innovation and I know clearly some of the stuff there excites you, but what about some opportunities in this space that excite you looking ahead to the rest of 2020?
John Laing: Yeah, the other thing that’s happening as a trend in the industry is a modular outdoor kitchen. And by that I mean instead of having a built-in grill with built-in stucco and granite tops, that’s not moving anywhere, the latest trend is to have these modular outdoor kitchens with add on pieces that you, with wheels, that you can actually roll around. And by chance you do move in five years or seven years, you can take that all with you if you choose to. It also gives you the ability to add on. So if you just want the grill today and you want to add on a kitchen sink or an extra side burner or refrigeration unit, it’ll give you that capability. So I would say these modular kitchen things are really hot and that excites me for this year.
What excites me most is I think that members are starting to get it, that they need to get serious about looking at the category and they can listen to me, they can listen to vendors try to give them their pitch. But really we are trying to set up a network where they can talk to their peers about what’s happening in the space, the ones that are in it that’s working for them, what they need to do to be successful because they listen to each other much more than they do us.
Rob Stott: Of course, always.
John Laing: Augmenting that will be, a backup from us is I’ve got a 45-page book about, a playbook on merchandising grills, my hints from Heloise on what you need to be successful. Every brand we have is represented in there with a three-level display suggestion, A, B and C, best-sellers identified. It really is, takes a lot of the homework out of trying to get into the space.
Rob Stott: Oh, that’s incredible. And something I’ve always enjoyed following and will continue to look forward to following. Maybe, I know there’s a couple more samples while we’re here, so I’ll maybe find my way over there before the show lets out. So John, I know we have, like I said at the top, a crazy schedule, so appreciate you spending a few minutes over here and chatting with us and look forward to continuing to follow this category. So thank you.
John Laing: Yeah, thank you much, Rob. Appreciate the time.
Rob Stott: Yeah.