Lumber Liquidators 2013 Annual Report Download - page 17

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Marketing and Advertising
Reach and Frequency. Our marketing and advertising strategy includes a focus on broadening the reach
and frequency of our message to increase the recognition of our value proposition and ultimately the number
of customers served. We utilize a mix of traditional and new media, direct mail and financing offers to
emphasize product credibility, value, brand awareness, customer education and direct selling.
We increase brand awareness in a variety of ways, including celebrity endorsements and product
placement opportunities. We have on-going relationships with respected, well-known home improvement
celebrities Bob Vila and Ty Pennington. Bob Vila, in particular, has been associated specifically with our
Bellawood brand for several years.
To increase brand awareness, we conduct ad campaigns on both a national and local level using both
traditional and new media. We work with shows such as HGTV’s ‘‘Dream Home Sweepstakes’’ and ‘‘This
Old House’’, which use our products and enable potential customers to see both what our flooring will look
like after installation and the relative ease with which it can be installed. In addition, we use targeted
television advertising across both cable and national networks. We engage in sports marketing by participating
in opportunities with, among others, Major League Baseball and National Basketball Association teams. On
the Internet, our advertising efforts include the use of banner advertising, sponsoring links on well-known
search engines, having storefronts with large e-tailers and having a large network of online affiliate partners.
We also utilize local and national radio, primarily for promotional messaging.
Our direct mail strategy focuses on regular contact with our customers and the targeting of prospective
purchasers. We have a healthy and growing database that we utilize to drive our direct mail and overall
marketing strategies. We distribute our catalogs, as well as other direct mailings, to key consumer and
commercial segments around specific store locations. Copies of our catalogs can also be obtained through our
stores, our call center and our website. In addition, we utilize direct mail for call-to-action promotions. We
expect to continue expanding our direct mailing efforts to prospective customers in markets where we have
stores.
Financing. We offer our residential customers a financing alternative through a proprietary credit card,
the Lumber Liquidators credit card, underwritten by a third party financial institution at no recourse to us.
This program serves the dual function of providing financial flexibility to our customers and offering us
promotional opportunities featuring deferred interest, which we often combine with product promotions. Our
customers may also use their Lumber Liquidators credit card to tender installation services provided by our
third party service provider.
We offer our commercial customers a financing alternative through the Lumber Liquidators Commercial
Credit Program, A Credit Line for Pros. This program is underwritten by a third party financial institution,
generally at no recourse to us. The commercial credit program also provides our professional customers a
range of additional services that we believe add efficiency to their businesses.
Services
We have an integrated multi-channel sales model that enables our stores, call center, website and catalogs
to work together in a coordinated manner. We believe that due to the average size of the sale and the general
infrequency of a hardwood flooring purchase, many of our customers conduct extensive research using
multiple channels before making a purchase decision. Our research indicates that the average length for a
hardwood flooring purchase, from initial interest to sale, is approximately 100 days.
As flooring experts, we strive to support all stages of the purchase cycle. Our objective is to help the
consumer throughout the process from aspiration to installation advice, whether in our store or in their home.
Our sales strategy emphasizes customer service by providing superior, convenient, educational tools for our
customers to learn about our products and the installation process. Our website contains a broad range of
information regarding our floors and accessories. Visitors to our website can search through a comprehensive
knowledge base of tools on wood flooring, including browsing product reviews, frequently asked questions
and an extensive ‘‘before and after’’ gallery from previous customers, as well as research detailed product
information and how-to videos that explain the installation process. A consumer also has the ability to chat
live with a flooring expert for questions about a flooring purchase or installation, either online or over the
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