Marketing Plan 2014 Mark Stephens

Woodworkers Source 5111 N. Scottsdale Rd, #206

Scottsdale, AZ 85250

Summary

Woodworkers Source is a distributor of domestic and exotic hardwood lumber, cabinet-grade plywood, architectural veneers, woodworking tools and related woodworking products. The company serves both retail and commercial customers; these customers include the following:

General hobbyist woodworkers, enthusiasts of specialized woodworking skills (turning, carving, scroll sawing), DIY individuals, semi-professional woodworkers, professional custom cabinet makers, custom furniture makers, school wood shops, and specialty manufacturers

Marketing expenditures for 2014 will be $254,050 and this will fund these programs:

Local Marketing $178,900 National Marketing $75,150

Directories 2%

PBS Sponsorship

6%

Rosewood Club 2%

Rebates 37%

Demonstrations 9%

Education Center 2%

Wood of The Month 2%

Contests 2%

Direct Mail 7%

Other Local 2%

Internet Advertising

11%

Magazine Advertising

16%

Other National 3%

Marketing Expenditures 2014 $254,050

Summary 2013 Actual Estimated 2014 Difference

Local Programs

Directories 6,500 4,100 (2,400)

PBS Sponsorship 13,000 15,600 2,600

Rosewood Club 4,200 4,000 (200)

Rebates 70,300 95,000 24,700

Demonstrations 30,000 23,200 (6,800)

Education Center 0 6,000 6,000

Wood of The Month 4,500 5,000 500

Contests 1,000 4,000 3,000

Direct Mail 19,400 18,000 (1,400)

Other Local 1,000 4,000 3,000

National Programs

Internet Advertising 28,000 28,650 650

Magazine Advertising 42,300 40,000 (2,300)

Other National 500 6,500 6,000

Totals 220,700 254,050 33,350

Woodworkers Source

Marketing Schedule

JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC BUDGET

Local Programs

Directories 4,100

PBS Sponsorhip 15,600

Rosewood Club 4,000

Rebates 95,000

Demonstrations 23,200

Education Center 6,000

Wood of The Month 5,000

Contests 4,000

Direct Mail

Exotic Hardwood Sale 6,000

Customer Appreciation Event 3,000

Sidewalk Sale 3,000

Fall Kick Off 3,000

Holiday Sale 3,000

Other

Store Displays 2,500

General support materials 1,500

TOTAL 178,900

National Programs

Internet Advertising

Website hosting 6,600

Website Maintenance 1,000

WOOD Mag. E-news 6,000

woodfinder.com 2,800

Google Shopping 12,000

Electronic Newsletter 250

Magazine Advertising

American Woodworker Jan Oct Nov Dec 4,300

Fine Woodworking Jan 8,000

Popular Woodworking Nov Dec 4,200

Wood Oct Nov Dec 16,300

Woodworker Journal 7,200

Other

Amazon.com storefront 0

Video Production 2,000

Customer Satisfaction 2,000

Various printed materials 2,500

TOTAL 75,150

GRAND TOTAL 254,050

Oct/Nov/DecJun/Jul Aug/Sep

Sep/Oct

Jan/Feb/Mar Apr/May Jun/Jul Aug/Sep

Jul/Aug

Nov/DecMay/Jun Jul/Aug Sep/Oct

2014

Feb/Mar Apr/May

Jan/Feb Mar/Apr

Jan/Feb

Feb/Mar Apr/May

Mar/Apr May/Jun

Jun/Jul Aug/Sep

Marketing Goals for 2014 Local

Emphasis on core product and best-selling items o Lumber o Plywood o Consumables

Less emphasis on machinery

Build on the demonstrations o Identify promotional products o Increase awareness on how/why to use products we sell o Staff training

Introduce paid clinics on specific topics and hands-on experience for customers

Staff Training o Festool o SawStop

Increase size of Rosewood Club to 9,500

Increase rebate redemptions to 85%

National

1,700,000 visits in 2014

Increase visibility of free shipping program

Increase free shipping rebate redemptions to 85%

More explanation of lumber packs, why to purchase them, benefits, etc.

Add Festool items to website

Create one new product demonstration video per month

Local Programs Woodworkers Source serves customers throughout Arizona with three walk-in stores:

North Phoenix

Tempe

Tucson These stores are characterized by:

High quality lumber and merchandise Broad selection Knowledgeable staff Old-fashioned, friendly customer service Thoughtful merchandising Clean, well-lighted warehouses and showrooms

To establish and maintain a first-rate market position, we use these advertising and marketing avenues:

New Yankee Workshop sponsorship

“Rosewood Club” Loyalty program

Rebate credit for loyal customers

Demonstrations

Wood of The Month

Email newsletter

Direct mail

Online/phone directory ads

These programs are detailed in the following pages.

Marketing Plan 2014: Phone Directory Advertising $5,400

Program

Local Phone Directory ads Objective

To get a phone call from a potential customer who is searching for hardwood lumber, retail lumber, and/or woodworking equipment and supplies within the major market books.

Description

Directory advertising expenditures have dramatically reduced every year as advertising in the books makes less sense. However, Woodworkers Source continues to advertise in the Sun City book because it’s understood this book still gets usage. Some online directories remain useful and well used. See next page for traffic rankings among the top three, YellowPages.com, Dexknows.com, and Yelp.com. The program with Dexknows.com will be discontinued this year; Alexa ranking is declining and ad performance dropped 38% from 1999 views to 1247 views. Yellowpages and Yelp appear to have stronger traffic and usage.

2014 Goals:

Evaluate online directories

$89,400

$76,400

$69,600

$47,800

$31,069

$10,358 $6,317 $5,387

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2007 2008 2009 2010 2011 2012 2013 2014

Directory Advertising Costs Change by Year

Online Directory Performance DexKnows.com performance is in decline with 38% fewer visitors to the Woodworkers Source store location profiles. It’s possible Yelp or Yellowpages makes more sense for a directory ad. Paying for a low-cost directory listing on at least one of the popular directories is important to stay in control of essential data such as correct hours of operation, phone numbers, images of the stores, etc. The various directories share the information back and forth. In 2014, the Dexknows program will be cancelled.

Alexa Rankings 2012 2013

DexKnows 6582 11,403

Yelp 186 140

YellowPages 513 610

1999

1247

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DEXKnows.com Profile Views 2012-2013

A lower number is a better Alexa ranking Alexa ranking for Dex is declining dramatically, indicating fewer people use this directory. Yelp appears to be the strongest directory.

Woodworkers Source

Directory Advertising

Issue

Directory Vendor Month Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total

Books

Sun City ATT January 91 91 91 91 91 91 91 91 91 91 91 91 1,092

Totals 1,092

Internet

dexknows.com DEX December 375 375 375 375 375 375 145 145 145 145 145 0 2,975

Yellowpages.com YP January 110 110 110 110 110 110 110 110 110 110 110 110 1,320

Totals 4,295

Grand Totals $576.00 $576.00 $576.00 $576.00 $576.00 $576.00 $346.00 $346.00 $346.00 $346.00 $346.00 $201.00 $5,387

2014

Marketing Plan 2014: Sponsoring PBS Woodworking Programs $15,600

Program

15 second ad at the beginning and end of the woodworking show every Saturday. Objective

To be visible to local woodworking enthusiasts as their first-rate home town source for woodworking supplies and equipment.

Description

One of the most popular slots on PBS is dedicated to one of three woodworking shows that rotate throughout the year. Woodsmith Shop, The Woodwright’s Shop, and Rough Cut Woodworking. The shows attract do-it-yourself consumers, woodworking enthusiasts and professional woodworkers. Being a sponsor of the show provides us a direct and targeted forum to advertise to these potential customers in the local market. It helps establish Woodworkers Source as the supplier for serious and enthusiastic woodworkers. Our advertisement runs at the beginning and at the end of each episode, which is considered two spots. The show airs on Saturday from 4:30 pm to 5:00 pm on PBS.

. Viewers Spots Cost 88,000 2 / week $150 ea Total $15,600 / year

2014 Goals:

Review ad narration to consider promoting demonstrations and woodworking education programs

Marketing Plan 2014: Woodworkers Source Rosewood Club $4,000

Program

A customer loyalty club that offers various benefits to customers Objective

To build a closer relationship with customers and encourage repeat business Description

Customers pay a $20 membership fee for the Rosewood Club and receive the following:

10% discount on any purchases, except for power tools and items on sale

Special invitations to free woodworking clinics or seminars hosted by Woodworkers Source

$50 rebate for every $1000 spent at Woodworkers source, paid quarterly

Weekly email messaging

Free tape measure at sign-up A marketing database collects sales data that is easy to sort and extract for the purpose of doing targeted marketing among these buyers. Marketing will take place by email or postal mail. This program cost $10,000 in 2010 to design, build, and launch. $4000 is budgeted for 2014 to fund incidental components to the program: demonstrators, signage, postcards, promotional goods, software changes, etc. 1,861 new members signed up in 2013

Total Members Members w/ purchases in 2013 2013 Sales 7,581 4949 (66%) $2,147,472

See next page for breakdown by store

2014 Goals:

Grow membership by 2,000 members Phoenix: 1000 Tempe: 500 Tucson: 500

1 special bonus buy per month

Tempe 2366 31%

Tucson 1270 17%

Phoenix 3945 52%

Rosewood Club Members by Store Total 7,581

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Rosewood Club Sign Ups by Year

Marketing Plan 2014: Quarterly Rebates $95,000

Program

Rewards for loyal customers. Objective

To increase the value of doing business with Woodworkers Source, strengthen relationship with and reward the best customers.

Description

Every quarter rebates are issued in the form of a store credit to customers who have accumulated $1000 in purchases within the same calendar year.

Rosewood Club: $50 for every $1000 spent

Commercial accounts: $100 with $2000 spent, $50 for every $1000 after

Mail Order: a free shipping coupon for spending $1000 or more

Customers receive an email and a postcard in the mail with their rebate at the beginning of each new quarter. Rebates expire at the end of each quarter, giving customers 3 months to use their rebate. 66% of rebates were redeemed in 2013.

2013 Rebates Issued Count Value Rosewood / Commercial 887 $71,950 Mail Order 275 $13,750 Total 1,162 $85,700 Redeemed 762 $70,273 Redeemed % 66% 82%

2014 Goals:

Inform all potential members about the rebates

Remind members that their purchases add up to a possible rebate

More “How to Get Free Shipping” exposure on the website

Marketing Plan 2014: Woodworkers Source Demonstrations $23,000

Program

Monthly woodworking product and technique demonstrations Objective

To excite customers about their own woodworking projects by demonstrating tools and techniques; to help our customers be successful in their woodworking projects.

Description

A demonstrator will spend one weekend in each of the stores to demonstrate a specific tool or woodworking technique to customers. Demonstrations take place on Fridays after business hours at 5:30 pm, and Saturdays at 9:00 am, 11:00 am, and 2:00 pm. The same demo repeats. The demonstrator gets customers interested in tools that perform specific tasks and shows customers how to use these items in their own woodworking projects. Demonstrations serve as an inspiration mechanism rather than a sales engine. Demonstrations are also used for training employees, growing their product knowledge and general expertise in woodworking skills, techniques and concepts. Store managers are to have each employee attend the demonstration.

Occurrence Cost Demonstrator $12,500 Taxes, Workers Comp $3,000 Supplies $3,000 Mileage, meals, incidental $4,700 Total $23,200

2014 Goals:

Demonstrator sells enough to pay for program

Every demo has a display of associated products for customer to buy

2013 Demonstrations and Attendance

January Bandsaw Techniques 158

February Building a Folding Shop Table 92

March Finishing 143

April Routers for Decorative Boxes 87

May Picture Frames and Joinery 73

June Finishing 100

July Sharpening 74

August Tips for Glue Ups 102

September Table Saw Essentials 140

October Joinery with Router 112

November Finishing 154

December Bandsaw Techniques 88

Total 1323

Marketing Plan 2014: Woodworkers Source Education Center $6,000

Program

The company will test a customer education plan in 2014. A small education center with capacity for 6-8 customers will be built in each store. Classes will be short 1-2 hours and specific. Registration will be online or in the store. While some classes may be free most will require a small registration fee.

Objective

To build a closer relationship with customers To help customers improve their skills and derive greater satisfaction To build greater woodworking and presentation skills in staff Establish Woodworkers Source as the “knowledge experts” for woodworking To build a new revenue stream

Description

Classes will be limited to 2 hours maximum and focus on very specific topics. Classes will emphasize hands-on instruction. A minimum of 4 must register. Any topic may be offered. Customers may form their own group for a class. If a class is requested, it will be offered. The possibilities are endless but here is a sample list:

Buying hardwood lumber

Tune up ______ (table saw, bandsaw, jointer, hand plane)

How to sharpen chisels, planes and scrapers

How to apply veneer

How to build a ___________ (drawer, door, cabinet, face frame, cutting board, etc)

Making a mortise and tenon joint

How to use grain filler

Spraying wood finishes While this is not a “build it program,” classes will be structured to provide as much hands-on participation as possible. Customers must register for a class. Online registration will be available or customers may register in the store but on the same system. Some classes may be free but most will have a small fee. The fee should cover the instructor and supplies for the class. $10-40 is the expected range. Instructors will participate in the fee. This will be a way to attract instructors and reward them for successful classes. Woodworkers Source staff will be encouraged to be an instructor. This will build their product knowledge, presentation skills and income.

2014 Goals:

Launch program

3 full classes per week

Table 400

Stools 300

Cabinet 300

White board, easel 200

Signs 100

Other 700

TOTAL per store 2000

Marketing Plan 2014: Wood of the Month $5,040

Program

Promote two species of wood – one domestic, one exotic – with special pricing and merchandising. Objective

Generate and increase lumber sales, gain customer interest for more frequent visits to the store at a minimal cost.

Description

The Wood of The Month program promotes two species of wood per month, one domestic and one exotic. To promote, the stores display a sign on the front door and merchandise the wood in a prominent place in the warehouse – typically a large lumber cart that allows customers to see and sort through 500 to 1000 board feet of the material. The featured woods are also promoted in the weekly email newsletter for maximum exposure at a low cost. This program began in May 2008, and most often doubles the units sold in comparison with the same month of the previous year. See the next page for results from recent featured woods. Distribution Cost Signs: 12 per month (four for each store) $420 per month Website banners $0 per month Email Newsletter $0 per month Total (for 12 times per year) $5,040 How a Featured Wood Is Chosen Exotics are selected based on s tock at the time, or a special buy that brings a significant profit opportunity. This is the anticipated schedule 2014:

Month Domestic Exotic Notes

January Walnut Jatoba February White Oak Bubinga March none All exotics Mahogany Feature

April Ash Tropical Walnut May Red Oak Padauk June Red Oak TBD July Alder Beech August Alder Beech September Hickory Purple Heart October none All Exotics Sapele feature

November All Maples African Mahogany December Cherry Leopardwood

2014 Goals:

Add short video of each featured wood

$70 worth of advertising on the doors, email promotion, and website promotion are the only advertising vehicles used to achieve the sales results above. This proves to be a very effective campaign.

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QS. White Oak Cherry Sapele Purple Heart

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2012 Featured Wood Sample Results

During Sale Average per mo

Marketing Plan 2014:

Direct Mail $18,000 Program

Sending sales flyers and event notifications to the Rosewood Club and Commercial accounts Objective

Multiple objectives include:

Giving special notice of events and sales to our Rosewood Club and commercial accounts

Developing events and sales that are beneficial to woodworking enthusiasts

Communicating with our customers about these events and sales

Driving traffic to the stores

Making customers aware of our services and expertise

Build sales Description

A direct-mail marketing program allows us to communicate directly with people who want to know about the products and services we offer. This proves to be a highly effective method to produce sales. Mailed pieces are professionally designed and sized to 6” x 10.5” – for postage purposes this size maximizes the amount of real estate we can mail at the letter rate, and we’ve worked out a general design layout that communicates our message. In favor of a more accurate list of real buyers, the Rosewood Club member list and our active commercial accounts replaced our previous direct mail list. Until 2011, we had accumulated a direct mailing list of 28,000 which cost $12,000 to design, print and mail a single campaign. Tightening the program to active customers, approximately 6,000, reduced each campaign to under $3,000 with no negative impact on sales. The list of scheduled mailings is on the following page. List type Count Commercial accounts 774 Rosewood Club members 7,542 Total 8,316

2014 Goals

TBD

Event Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total

Exotic Hardwood Sale

3,000

3,000

6,000

Customer Appreciation 3,000

3,000

Summer Clearance

3,000

3,000

Fall Kick Off

3,000

3,000

Holiday Sale

1,500 1,500 3,000

Total

$18,000

Exotic Hardwood Sale 33%

Customer Appreciation 16%

Summer Clearance 17%

Fall Kick Off / Featured wood 17%

Holiday Sale 17%

Direct Mail Overview

Marketing Plan 2014:

Local Email Newsletter $0.00 Program

Sending sales promotional emails to the collected Woodworkers Source mailing/customer lists in the Phoenix and Tucson markets.

Objective

Communicate with our customers once a week to reinforce current specials and promotions at virtually no cost while building sales.

Description

Based on the success of our email newsletter for mail order, we’ve established a list that communicates only with local customers to drive traffic back to the stores. Distributed weekly, the email newsletter includes a variety of interesting items that our woodworking customers would want to know about. Such as: recent topics at the discussion forum, a remarkable project picture from the gallery, current special(s), the wood of the month, a bounce back coupon, or helpful information that highlights our expertise or services. Building this list is performed through the website where visitors are asked to join in exchange for a $10 coupon to use at the store. A new subscriber checks a box for the store that’s nearest to their home. The email that goes to these customers also goes to the Rosewood Club members, unless there is a separate specific campaign for Rosewood Club members.

Local 1,786

Rosewood Club 6,137

Commercial 277

Mail Order 8,038

Total 16,238

2014 Goals

Promote Rosewood Club

Include woodworking tip in each one.

Marketing Plan 2014:

Woodworking Contests $4,000 Program

A juried woodworking-based competition in which entrants deliver a project for a chance to win prizes Objective

To promote woodworking as a hobby, build rapport with customers, and encourage project building Description

A contest has a theme or a central challenge, and is open to all skill levels. There is no fee to enter a contest. Vendors support the contest by providing prizes and receive promotion and access to photographs in exchange for their support. Woodworkers Source provides an incentive to complete and deliver a project, usually a $50 in-store credit. Woodworkers Source assembles a team of judges, typically professional designers, craftsmen, artists, or educators who determine winning entries. The best entries get collected into a public art exhibit for display shortly after the contest due date. Woodworkers Source works with local galleries or arts centers to secure the space and proper promotion. A contest takes place twice a year, one in spring and one in fall.

2014 Goals

Launch program

WOODWORKINGWOODWORKINGCONTESTCONTEST

www.woodworkerssource.com/contestwww.woodworkerssource.com/contest

Project Theme: Occasional TablesBuild a small decorative table and enter it in our contestBuild a small decorative table and enter it in our contestfor a chance to win fantastic woodworking tools andfor a chance to win fantastic woodworking tools andsupplies. The table can be a night stand, end table, hallsupplies. The table can be a night stand, end table, halltable, coffee table, plant stand, candle stand, tilt top,table, coffee table, plant stand, candle stand, tilt top,nested, rectangular, square, oval, round, or any othernested, rectangular, square, oval, round, or any othershape or style. The only constraint is that it must beshape or style. The only constraint is that it must besmall, which we define as no larger than 32” or smallersmall, which we define as no larger than 32” or smallerthan 10” in length, width or height.than 10” in length, width or height.

OVER $2,000 IN PRIZESOVER $2,000 IN PRIZES

Key Dates:March 1, 2014 - Project entries due, receive $50 store creditMarch 7, 2014 - Awards announcedMarch-April 2014 - Public art exhibit announced

Tempe645 W. Elliot Rd480-355-5090

Phoenix18115 N. Black Canyon Hwy602-504-1931

Tucson3441 S. Palo Verde520-745-8301

See back side for prize packages!

REGISTER TODAY! IT’S FREE TO ENTER:

Plus get $50 store credit just for entering your table

$800Prize Value

First Prize� Jet Benchtop Mortiser� Kreg Jig K5, Kreg Automaxx 3″ clamp� Johnson Levels 25′ tape measure� Tenryu 10″ coated Silencer table saw blade� Festool SysLite LED work light

Prize Packages

+9 other prizes for honorable mentions

Second Prize� Kreg Klamp Table with Steel Stand� Festool Toolbox� Tenryu 10″ coated Silencer table saw blade� The Complete Illustrated Guide to Joinery book

$575Prize Value

People’s Choice Prize� Bora Wide Track Clamp Kit� Festool Toolbox� Trend diamond sharpening stone$275

Prize Value

Third Prize� Kreg Benchtop Router Table� Festool Toolbox� Tenryu 10″ coated Silencer table saw blade� Whiteside Cove & Bead router bit

$400Prize Value

National Programs (Mail Order)

Woodworkers Source ships lumber and wood products to customers throughout the U.S. and parts of the world. Most business comes through the company website, www.woodworkerssource.com which serves as an industry-leading resource for exotic woods. Redesigned and upgraded in June 2013, the Woodworkers Source website features a comprehensive wood species database that’s searchable, a blog, and a woodworking project gallery. Customers and visitors post and contribute freely to the gallery, and all visitors are invited to comment on the blog. To establish and maintain a first-rate market position, we use these advertising and marketing avenues:

Company website

Email newsletter

Product videos

Pay-per-click advertising

Various internet advertising opportunities

Customer Satisfaction Survey Bounce Back

Amazon storefront

Magazine advertisements Woodworkers Source has the best ranking website offering lumber for sale, and continues to do better every year. Competitors with Alexa Ratings (as of December 2013):

Site 2013 Rank 2012 2011

woodworkerssource.com 87,263 149,444 153,825

bellforestproducts.com 507,140 590,550 1,019,598

hearnehardwoods.com 819,067 767,270 819,446

westpennhardwoods.com 1,111,503 1,822,974 1,575,862

cookwoods.com 1,227,647 489,850 624,439

exoticwood.biz 1,469,250 2,049,449 1,963,125

gilmerwood.com 3,654,707 2,252,047 2,634,588

exoticwoods.com 4,221,060 3,785,716 8,047,491

walllumber.com 4,613,191 2,244,893 4,238,359

amazonexotichardwoods.com 15,888,650 1,833,087 3,938,659

These programs above are detailed in the following pages.

Marketing Plan 2014: Website $7,580

Program

Woodworkers Source website with e-commerce, wood species database, woodworker project gallery, and blog: www.woodworkerssource.com

Objective

To be the online leader for hardwood lumber, veneer, and turning stock; to allow out-of-state customers to purchase lumber and wood products quickly and easily.

Description

Our website is the largest producer of mail orders for Woodworkers Source. To work towards being the single best online source for hardwood lumber, we have to provide a website with these simple and widespread standard features:

Comprehensive information about the woods and subsequent products

Easy-to-understand and fast online ordering

Pleasant and friendly language throughout

Simple online order tracking and order status check

Accurate photographs of the woods

Visible contact information that includes phone numbers, addresses, faxes, and emails

Free information and resources that may be useful to woodworkers or first time wood buyers

To help earn an authoritative ranking among wood oriented websites, we have an online wood database (dubbed “Wood Library”) that’s inclusive of nearly 1000 wood species with details and pictures of each. Additionally, visitors to the website can share project pictures in the project gallery, read and comment on the blog. Competitive advantages of Woodworkers Source: No minimum order; well-organized product merchandising; clear shipping charges; quantity discounts; extensive wood species information; easy and secure online ordering; online order tracking and processing; unique and rare wood items; free shipping loyalty program. 1,187,000 visits in 2013 98,950 avg visits/mo Item Cost Hosting Plan $5,280 / year

Security Certificate $300 / year Nextopia Search $1000/ year

Software updates $1000 / year Total: $7,580 / year

2014 Goals

Traffic – 1,700,000 visits in 2014

Conversion Rates – Increase conversion rate to 0.75%

Average Order – Increase average order to $250

2013 Totals

Visits Orders Sales Avg. Order Conversion Rate

1,187,403 6,612 $1,116,434 $168.85 0.56%

Goals for 2014 are to increase the qualified website traffic, improve the order conversions, and increase the average order value. Here are the trends from 2013, which indicates that boosting the conversion rate remains the most difficult to improve. Overall traffic continues to climb at a surprising pace.

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2013 Website Conversion Trend

Marketing Plan 2014: Amazon.com Storefront $0.00

Program

Selling wood products and tools through the amazon.com merchant marketplace. Objective

To increase our exposure to consumers looking for wood products and selected tools that we carry while generating sales. To move obsolete or discontinued items quickly.

Description

This is a partnership with amazon.com. While we are allotted an unlimited number of products to display, all pricing must be the same as on our website. Amazon handles payment processing and customer interface; we provide prompt service and delivery to the customers who order through amazon.com. The cost for this program is variable since Amazon simply takes 12% of the sales. On the upside, Amazon handles credit card processing and fraud detection.

Declining Performance: Our sales on Amazon were largely from tool sales, in particular Fein MultiMasters and vacuums. The selling format on Amazon allows customers to choose from a list of retailers from whom to purchase, and there are over 20 retailers selling woodworking tools on that site. The increase in competition and free shipping opportunities makes price the only consideration when customers purchase. The positive aspect of selling on Amazon is we do sell a large amount of wood edge tape and veneer. Where the tools were $200-$400 each, these commodity products are only $10-$50.

2014 Goals

Maintain edge tape inventory in the store to meet demands of Amazon orders

$79,288

$63,200

$31,868

$8,262

$19,413

$29,753 $25,858

$17,605

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2006 2007 2008 2009 2010 2011 2012 2013

Amazon.com Sales

Marketing Plan 2014: Social Media Presence $0.00

Program

Interacting with customers through the various online methods. Objective

To build interaction with customers, primarily to help them be successful in their woodworking projects and make Woodworkers Source known as the authority on hardwood lumber for woodworking.

Description

We use the following networks talking with customers and helping with their projects:

Woodworkers Source Project Gallery

Woodworkers Source Blog

Facebook

Twitter Facebook and Twitter allow us to share links, videos, and interesting articles with woodworkers who are working on projects. Generating direct sales through these mediums is rare. Instead, we bring customers some value to their woodworking with woodworking tips, links to helpful articles, and so on.

2014 Goals

Post once per week

Offer woodworking tips, videos, plans and useful information

Marketing Plan 2014:

Email Newsletter $250 Program

Weekly Email Newsletter, Woodworkers Source News Objective

To generate sales by communicating with existing customers and potential customers on a weekly basis. Description

The email newsletter establishes significant sales without significant cost. The most effective campaigns prove to be unique deals just for subscribers and woodworking tips/advice. This is a way to put a friendly and consistent face on Woodworkers Source while emphasizing specials, services, and expertise. Additionally, the newsletter is in total compliance with the CAN-SPAM Act of 2003 (Controlling the Assault of Non-Solicited Pornography and Marketing Act). All email addresses are double opt-in, unsubscribe requests are handled automatically, and Woodworkers Source does not sell or share the list with any outside firm. With the new website design in 2013, the newsletter sign-up has a larger presence at the top and middle of the screen. Subscribers: 8,049

2014 Goals

Continue to focus on email content that customers want to receive, and promotions they will respond to

Upgrade to latest software

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Newsletter Subscriptions by Year

Email Newsletter Statistics

Subscribers 2013 Visits 2013 Sales 2013 Orders Avg. Order Conv. Rate

8,049 63,856 $176,203 857 $205.60 1.34%

2013 Top 10 Newsletters (Visits) Letter Visits Orders Sales Conv. Rate Subject Line

news488 3603 93 $23,121.70 2.58% Wonderful Walnut Lumber

news485 2330 24 $3,527.11 1.03% Woodworking with Bamboo?

news529 2028 16 $5,053.14 0.79% Cherry Lumber …

news511 2005 13 $3,490.91 0.65% Using Baltic Birch in Woodworking

news486 1851 20 $3,731.49 1.08% 3 Reasons to Use Alder in Woodworking

news520 1813 17 $1,750.97 0.94% The 12 Best Exotic Woods

news526 1738 29 $7,918.13 1.67% Maple Lumber Sale

news522 1680 10 $4,934.37 0.60% Project Plan of the Week

news504 1653 13 $1,634.11 0.79% A Cutting Board Woodworking Project

news517 1640 10 $1,485.53 0.61% Bamboo for Woodworking?

Note about List Size: Approximately 40 people sign up every week. However, the list does not necessarily grow by that much. There are three reasons why actual growth is slower:

1. List Clean-up Members are deleted if they have not opened a newsletter in the last two years 2. Unsubscriptions. On average, 10 people unsubscribe to the newsletter every week. 3. Obsolete addresses. Email addresses have a high turnover rate: according to the Direct Marketing

Association, 31% of email addresses become obsolete every year. People change internet providers and jobs, or simply change emails to avoid spam.

Marketing Plan 2014: Internet Advertising $8,400

Program

Advertising on woodworking related websites Objective

To drive woodworkers and wood enthusiasts to our website. Description

A strong web-presence is necessary for maintaining the website as an industry-leading resource for woodworkers searching for wood/lumber products. Since the Woodworkers Source website has proved to be the best (and most efficient) producer for mail orders, we need to continue to drive traffic to it. To do this, we have three website partnerships:

WOOD e-Newsletter – text mention advertisement (79,970 Alexa Rank) o $500 per month program includes:

300x250 banner ad on WOOD Magazine website, 40,000 impressions / mo 2 e-newsletter mentions per month

2013 Cost Visits Sales Orders Conversion Rate Avg. Value

$6,000 19,169 $12,396 58 0.30% $213.72

Woodfinder.com – database for wood and lumber dealers (1,452,598 Alexa Rank) o $200 per month program includes:

Dedicated full page Listing with all the species carried Contact info for each store Link to website landing page

2013 Cost $2,800

Visits 1.791

Sales $2,290

Orders 12

Conversion Rate 0.67%

Avg. Value $190.83

Woodworker’s Journal – email newsletter, banner ad (167,715 Alexa Rank) o $0.00 per month program is bonus incentive included with magazine ad:

4 email newsletter sponsorships in email newsletter 728x90 pixel banner ad

2013 Cost $0.00

Visits 1,202

Sales $160.00

Orders 2

Conversion Rate .17%

Avg. Value $80.00

2014 Goals

Conversion rate to 1.00% by using specific landing pages with a special offer

Examine new online opportunities for advertising

Marketing Plan 2014: Google Shopping $12,000

Program

Listing products from the website in Google Shopping search results Objective

To increase conversions among web searches specifically looking to buy products that we sell. Description

Google Shopping allows shoppers to quickly and easily find only products for sale. These search results do not show articles, blogs, or other types of webpages. According to Google, Google Shopping offers the following advantages to merchants:

Attract more potential buyers. Google Shopping helps you to reach shoppers while they are searching for items to buy on Google.

Control your product information. With Google Shopping, you can maintain the accuracy and freshness of your product information, so your customers find the relevant, current items they're looking for.

This program used to be free. In Fall 2012, Google changed to a pay-per-click program with improved tools for merchants to keep control of the product listings and emphasize certain products (such as sales or featured items). While it now costs money, we control our budget and there is no commitment.

Cost Visits Sales Orders Conversion Rate Avg. Value

$7,800 19,649 $28,139 255 1.30% $110.35

Google Shopping generates a better conversion rate and more sales than the woodworking related websites.

2014 Goals

Continue with caution

Conversion rate to 1.5%

Marketing Plan 2014: Customer Satisfaction Survey $2,000

Program

A way for the customer to rate their mail order experience with us. Objective

To earn the customer’s trust and create fans of Woodworkers Source. Description

Within each mail order the customer receives a survey card. An example is on the next page. The card is a simple Business Reply with 5 questions and an area for customer comments. There is an online form for the customer to use as well, the URL is noticeable across the top of the survey card. Attached to the survey is a reminder about the free shipping program. Customers can accumulate $1,000 in purchases within a calendar year to earn free shipping on their next order. Customers are reminded to visit www.woodworkerssource.com/freeshipping to get the full details. The mail order department is rewarded with a $3.00 bonus for each perfect score card. The bonus pool is divided among the mail order crew quarterly.

2014 Goals

Improve to 95% Satisfaction

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10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 31 33 35 37 39 41 43 45 47 49 51

Sco

re

Week

Weekly Score YTD 2013

Marketing Plan 2014: Video Lumber/Product Demonstrations $2,000

Program

Short informative website videos that introduce the woodworking characteristics of a particular wood Objective

To give build on the expertise of Woodworkers Source, improve search engine placement, help customers improve their woodworking experience and to promote a specific type of wood.

Description

Hobbyist woodworkers, both novice and advanced, frequently have very little knowledge of how hardwoods behave during woodworking. To be successful at woodworking it’s important to understand how a given wood will perform as it’s worked into a piece of furniture or another project. The videos aim to be packed with useful information, especially on how to finish wood to make it look its best. Videos also aim to have long-term relevance, no current pricing or promotions are mentioned. Videos are displayed on the website with the associated product, and the entire collection is at Youtube: http://www.youtube.com/user/WoodworkersSourcecom

2014 Goals

One new video per month

Marketing Plan 2014: Magazine Advertising $40,000

Program

Advertising in the trade and enthusiast woodworking magazines. Objective

Communicating with the target market that Woodworkers Source is the leading mail-order source for exotic and domestic hardwood lumber.

Description

Several magazines cater directly to woodworkers and wood enthusiasts. Woodworkers Source develops and maintains relationships with representatives in order to secure spotlight ads in email newsletters and project articles. In addition, Woodworkers Source purchases advertising space in the marketplace sections of each magazine. We advertise in these periodicals:

American Woodworker

Fine Woodworking

Popular Woodworking

WOOD

Woodworkers Journal The ads also feature the website URL, www.101woods.com to do a number of things:

Use a short, memorable url in the ad

Provide a landing page for tracking results

Results are on the following page.

2014 Goals

Improve conversion rate to 2.00%

Improve the ad to emphasize expertise

Modify landing page to incorporate an exclusive offer for those who come to that page from the magazine ads.

Magazines Circulation Issues/year Cost per Year Cost / 1000 Impressions

American Woodworker 90,943 6 $4,350 $7.97 Fine Woodworking 182,082 12 $8,032 $3.68 Popular Woodworking 147,507 7 $4,165 $4.03 Wood 463,103 7 $16,240 $5.01 Woodworkers Journal 164,762 11 $7,150 $3.95 Total $39,937

Woodworkers Source

Magazine Advertisements

2014

Cost per issue

Publication Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total

American Woodworker 725 725 4,350

Fine Woodworking 672 672 694 672 694 672 694 672 694 672 672 552 8,032

Popular Woodworking 595 595 4,165

Wood 2,320 2,320 2,320 2,320 16,240

Woodworkers Journal 650 650 650 650 650 650 650 650 650 650 650 7,150

Total 1,917 4,367 1,939 4,367 1,939 3,717 1,939 2,047 4,259 4,367 4,237 4,842 $39,937

2,320 2,320 2,320

725 725 725 725

595 595595 595 595

Magazine Advertising Results

Visits Sales Transactions Conversion Rate Avg. Order

22,852 $40,459 203 0.89% $199.31

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2009 2010 2011 2012 2013

Vis

its

Visits Generated by Magazine Ads by Year

$15,000

$20,000

$25,000

$30,000

$35,000

$40,000

$45,000

2009 2010 2011 2012 2013

Sale

s

Sales Generated by Magazine Ads by Year

WOOD Magazine 59%

Woodworkers Journal

13%

American Woodworker

6%

Fine Woodworking 14%

Popular Woodworking

8%

Magazine Visitors 2013 -- 22,852

Current Magazine Ad Samples

Woodworkers Journal, American Woodworker WOOD Magazine

Fine Woodworking, Popular Woodworking Fine Woodworking offers 5 special interest

publications, so the ad is targeted to the topic.

Examples.