Filling the pipeline
Challenge: Build Sales Volume to Overcome Typical Small Order Size
As a replacement parts distributor maintaining an extensive stock inventory, Moore Industrial holds a distinctive position in the market: it is the ultimate go-to source for manufacturers needing fast turnaround on unusual pieces. By stocking about 75% of the products in its catalog. Moore competes on availability, if not necessarily on price.
With more than 20,000 different handles, hinges, latches, springs, locks and similar products in the catalog of stocking distributor Moore Industrial Hardware, you might say that hard-to-find hardware is the company’s stock in trade. Founded in 1975, the privately held business is the beloved namesake of Paul Moore, an octogenarian who remains active in the business today.
At an 18,000-square-foot facility in Cincinnati, Ohio, Moore employs just 12 full-time staffers but represents over 70 parts manufacturers. The company targets “people on wheels” – makers of tractor-trailers, utility and fire trucks, school buses – along with select companies in the aerospace and other sectors. Small manufacturers are Moore’s bread and butter, with only 5% of the company’s $4.3 million in sales in 2008 coming from large organizations. The decision makers choosing Moore range from engineers and purchasing agents to the welder and fabricators on the shop floor who need a specific part.
The flip side of this model is that, because customers turn to Moore to meet their most urgent needs, the orders tend to be fairly small, typically in the hundreds of dollars. “We’re fine with small orders as long as we get a lot of them and continue to build our customer base,” said Jim Voss, general manager of Moore Industrial. Moore’s customer roster totals about 4,400, the largest of which accounts for only 3% of the company’s annual revenues, but because very few customers could be considered regular buyers – it’s not uncommon for “repeat” customers to go three years between orders – those numbers also point to the need to constantly keep the wheels of the new business machine turning.
“As a stocking distributor, our strategy is to have items on hand when customers need them,” said Voss. “Because we’re not the lowest price supplier in the market, our daily challenge is to provide same-day delivery and good customer service.”
In addition, Moore found it needed to contain the costs associated with constantly updating and producing a print catalog while finding a more efficient means for featuring as many partners’ products as possible. Said Voss: “We had a 600-page catalog and the day we printed it, it was already obsolete.”
Solution: An Online Catalog that Saves Print Costs and Delivers Ready-to-order Customers
When contemplating possible solutions, Voss and his team felt that switching out a costly and instantly outdated print catalog for an online alternative held the key to resolving the company’s challenges. But first, Moore needed a partner to help develop an online strategy. The company already trusted ThomasNet’s 110-year history working in the industrial marketplace.
Working side by side with ThomasNet’s experts, the team created a dynamic online catalog of hundreds of door holders, latches, gas springs, brackets, tie down rings and more. Should the availability of one product materially change, the Moore team can update the catalog instantaneously with easy-to-use back-end tools. That allows for a trustworthy and accurate inventory – key for reliable customer service.
“Sure, ThomasNet is always available to support us; we know we can rely on them if we don’t have the time to make updates ourselves. But what is most exciting to me is our ability to go in and change or fix the content whenever and wherever we need to. That, to me, makes the ThomasNet solution an even more exceptional value,” Voss said.
With its online catalog content always up to date, it also performs a key sales task of developing new leads. The catalog is rich with keywords, technical language and other tools to help Moore rise to the top of online searches. It’s drawing those urgent-need, ready-to-order customers to the door first, before they turn to the competition.
“Because our standard M.O. is to provide quotes for orders that may not be placed for months, it’s critical that we keep the qualified-lead pipeline filled,” added Voss. “And with the enormous volume of leads we’re seeing from search engines, I’d say we’re landing at least one new customer a day – maybe more.”
The online catalog is set up to anticipate and answer a customer’s question – acting like another salesperson in the office.
“We're not a big company, so we need to make sales as efficient a process as possible,” said Kathy Kirby, who heads up sales for Moore. “Now when customers contact us after visiting the catalog, they've already seen the part they're interested in. They know the specs work for them. So by the time they reach us by phone, a greater percentage of them are ready to place an order, which reduces phone time and makes us more productive.”
Results: A Record Haul of New Customers – Here and Abroad – Helps in a Recession
“The online catalog has helped make our business a bit more recession-resistant,” said Voss. “In the past, our business would move with the economy, but this time, as serious a downturn as we’ve had, we seem to be staying ahead of the recession. Now, we can sell direct and work the pricing of the 10% of the products that make up 90% of our total sales.”
No statistic is more impressive than Moore’s record haul of 1,540 new customers in 2008, 20% of which were a direct result of the online catalog. In January 2009 alone, Moore recorded 104 new customers, about half of which came to the company through the catalog, and one of which produced $28,000 in sales. Not bad for a company whose average order is about $250.
Indeed, by just about every measure, Moore has achieved exceptional success since launching its online catalog. Across the board, key statistics all increased markedly when Moore’s site went online in 2007, especially with search engine referrals.
“The online catalog dramatically improved our ranking on search engines,” said Kirby. “I thought our search engine referrals were good at nearly 8,000 in 2006, but after we put up the online catalog, they mushroomed to nearly 48,000 in 2007.
Other metrics similarly illustrated the strength of a catalog that works like a salesperson. User sessions jumped from 18,398 in 2006 to nearly 70,500 in 2008, while conversion actions – either an email request or an order – leaped more than five-fold, from 91,554 to 469,763.
“The online catalog has become the focal point of our selling strategy. We're getting business from customers now who would never have been able to find us in the past,” Voss said. The company reports a doubling in Canadian business in 2008 over the prior year, including an order totaling $3,000 because the customer was unable to get the necessary part from a Canadian supplier in fewer than 12 weeks. Other orders came in from Spain, the U.K. and Mexico, where one customer placed a dozen orders that totaled $2000.
Moore has also learned from catalog-based inquiries how to better fulfill customers’ needs. “As a direct result of our growth in customer base and sales, we’ve been able to bring in new hardware lines and expand our offerings,” said Voss.