Gateway Inc. aims to use its consumer presence at 302 retail stores as a way to attract b-to-b customers.
In April, Gateway launched a 40-city trade show tour tied to the Information Technology Exposition & Conference series. Local salespeople at its retail Gateway Country stores are tapping their contacts to give potential business customers free passes to the ITEC shows, which focus on small and midsize businesses. Gateway is following up by offering free seminars at its local stores a week or two after the ITEC shows.
The strategy bucks Gateway’s reputation as an entry-level computer company for unsophisticated buyers. The goal is to draw business buyers into retail locations that feature spotted cow boxes, faux barnyard gables and "aw shucks" friendly retail sales specialists.
"We don’t think business customers will be turned off because their stores look like petting zoos," said Eric Shuster, exec VP-corporate development research and consulting for Access Markets International Partners Inc., New York. "Using trade shows to promote its country stores seems like cost-effective marketing.’’
Success selling services
Thirteen cities into the tour, the company is meeting with success, said Tom Hume, director-marketing communications for Gateway’s b-to-b unit. The program’s goal is to sell businesses on Web hosting, domain name registration and e-commerce services, which have been recently added to Gateway’s core desktop computer and laptop trade.
"A lot of this is done for relationship building, expanding recognition of our capabilities in specific geographies,’’ said Hume, who so far has helped orchestrate tour stops in such markets as Seattle, Indianapolis and St. Louis.
Live Marketing, Chicago, a specialist in integrated trade show marketing programs, was hired by Gateway to produce the live presentation for the multicity tour.
Live Marketing’s work included creating the pull-through strategy to get audience members from the trade show floor into the Gateway retail stores. That strategy involved lead generation cards, distributed to audience members at the ITEC shows. The cards contained a list of seminars being held at local Gateway stores.
At the conclusion of a trade show, where Gateway will have contact information about local business people, the company’s centralized telemarketing department and local sales staff will work the phones to draw leads into its stores.
Gateway is tracking expenditures for the program against returns, but Hume declined to comment on the campaign’s budget for competitive reasons.
"The Gateway model can work, but they have a lot of work to do to make it succeed,’’ said Mark Margevicius, senior research analyst with Gartner Group Inc., Stamford, Conn. "Indeed, the difference between Gateway and competitors [such as Dell Computer Corp. and Compaq Computer Corp.] are its point of presence.’’
The biggest drawback is that Gateway can’t offer business buyers the ability to compare products across multiple manufacturers, said AMI’s Shuster, whose firm advises such companies as Cisco Systems Inc. and Microsoft Corp. on small- business tactics.
"On the other hand, Gateway’s store personnel is light years ahead of OfficeMax or Office Depot, where the guy helping you with a critical business decision might have been working in furniture last week,’’ Shuster said.
At its stores, specialists give seminars on such topics as e-commerce and networking services. A turnout of a dozen people at a seminar is considered acceptable.
Gateway has contracted with local technology companies to provide co-branded computer services in its local markets.
Margevicius said the seminar program is designed to push Gateway into business services, a market that is far more profitable than computer hardware sales. The company’s ability to control the quality of service its local partners provide will prove critical, since its well-established brand is on the line every day, he said.
"When Gateway sells business services, the key issue is control,’’ he said. "This is a complex opportunity in front of them, and they are learning as they go. If a partner fails to execute on the technical side, Gateway is at risk. The customer thinks they have one throat to choke, and that is Gateway’s.’’