0-1,200 stores in only 4 years
Lighting distributor ON THE SPOT partnered with Spottune to expand into retail audio. In less than 4 years, they have gained substantial revenue boost from fitting more than 1,200 stores across Scandinavia with audio systems.
We had a talk with Simon Skovgaard, CSO at ON THE SPOT, to hear how they managed this.
It ́s pretty simple. We are building long term relationships with our customers, creating tailored solutions to meet their requirements.
Over the course of 30 years, ON THE SPOT has worked its way to becoming the leading lighting provider for retailers in the Nordic regions. A few years back, shrinking margins signaled it might be time to expand beyond fixtures, lamps, and downlights.
We started thinking about how to better serve customers and sustain growth.
Simon continues to explain how the popularity of online shopping has created a need for physical stores to surpass simple transactions with a rewarding experience to draw in customers.
It’s clear to see that the ones who are successful are the ones who invest in engaging shoppers.
Finding the Right Audio Partner
As luck would have it, right around the same time ON THE SPOT was considering what new products could supplement their product line, they discovered Spottune - a promising audio startup.
We immediately recognized the potential of Spottune, as they were a plug and play solution for us to offer alongside our light systems. The great thing is that Spottune utilizes the same power tracks as our lights, thus eliminating the need for us to partner with separate audio experts to offer audio systems to our customers.
Initially, the lighting distributor was hesitant about offering startup products, fearing bugs in the system could potentially ruin the trust built with customers over the years. Spottune is however created by a team of serial entrepreneurs with multiple successful audio projects behind them, and this initiated the trust to include them in their product range.
Overcoming Initial Retailer Hesitation
Early retailer interest was cautious, due to past reliability and coverage problems with other wireless options. To overcome doubts and nurture business relationships, Simon and his team carefully monitored all test stores and worked closely with Spottune to quickly fix potential problems.
Rapid Growth in Retail Installations
Now four years since these initial trials, ON THE SPOT have installed Spottune in more than 1,200 stores across Scandinavia, demand is on an exponential rise, and wireless audio now makes up close to 10% of the lighting distributor's yearly revenue.
Strengthening Core Offerings
Beyond direct sales, Spottune actually may end up strengthening ON THE SPOT's core lighting business.
Offering an audio solution allows us to connect with retailers that previously declined to work with us, due to contractual agreements with other lighting distributors. Who knows - once these contracts expire, hopefully we will be the preferred supplier in general.
To sum up: By expanding their product offerings through a strategic partnership with Spottune, ON THE SPOT has been able to provide a complete shopper experience solution to retailers, while simultaneously fulfilling the demand for fewer distributors offering a wider selection. This has thus opened new business opportunities and strengthened existing customer relationships.
Key Takeaways for Distributors
For distributors considering similar diversification, Simon Skovgaard has following advice:
- Know Your Customers – Keep close and understand their changing needs. Look for opportunities to add value.
- Build On Your Strengths – Expand into products that leverage your existing expertise and infrastructure.
- Seek Strategic Partnerships – Find innovative brands that complement your core offerings.
- Obsess Over Quality – Deliver exceptional service and reliability to exceed expectations.
- Focus On the Experience – Provide the complete solution your customers seek.
We hope the above can help you choose the right complementary products to grow your business.