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Cat-showroom-web.jpg Willie Vogt
RETHINKING RETAIL: This model showroom for Caterpillar shows a new look with a more consumer feel. The entire show floor is based more on providing the one- or two-machine buyer a better retail experience in an effort to bring more customers to the company.

Company is updating its retail experience

Caterpillar wants to reach beyond the big fleet customer as its product line expands

How you buy equipment is changing and companies want to work with you to keep up and provide the purchase experience the customer wants. One company that’s committing to a new approach to retail is Caterpillar.

Long known for its massive machines and big fleet buyers, the company’s equipment lineup has been expanding, but meeting the needs of a new customer group brings challenges. Dealers long focused on big, multi-machine buyers, didn’t always provide a welcome experience for the smaller player. Yet as the company has expanded into skid-steer loaders, utility vehicles, mini-excavators and other tools, there’s a need to connect with the one- and two-machine buyer.

“What we have come to understand is that a lot of these new customers…were not necessarily going into the dealership [for that type of equipment],” says Alex Stokman, marketing manager, Building Construction Products, Caterpillar. “We were not doing a good job of serving that base.”

What the company found was that those smaller buyers were bypassing the Cat store and heading down the road to a competitor. Yet the company knew that this customer base was a key part of the growth potential for the future. “That customer base is critical to Caterpillar, not just BCP, but Caterpillar,” Stokman says.

How to solve the problem? The company engaged in significant research to better understand who the customer is, how they shop and what the company needed to do. The answer was to create a one-stop shop. “They can find all they need, machines, attachments, parts, service and personal protective equipment,” she says. “On top of that, once they do get into the showroom the have to be able to see what they’re looking for, so we redesigned showrooms.”

Changing customers

Understanding the evolving buying experience is important. For the non-farm consumer, the rise of online buying, transparent pricing and other factors is upending brick-and-mortar businesses. Caterpillar research put into practice aims to train dealers to understand that some people don’t want to talk to a salesperson when they enter the store. “Our job is to give the customer options for how they view equipment. We’re providing all the specifications they need to know and they can find it online,” Stokman says. “And they can get pricing in the store without talking to a sales person.”

The company is even working on a buy online, take delivery at the store model that is becoming common at Target and Walmart – perhaps not in an hour, but the ability to spec a machine and make the purchase online is coming for the future. Stokman says Caterpillar will roll out digital equipment sales in 2020.

In Cat’s Clayton, N.C. training facility, visitors are greeted with a new model store. The brightly lit facility has racks of consumable products like grease or oil. But you’ll find hats shirts and other incidental items too. The showroom has a utility vehicle inside and a mini-excavator, both with clear spec sheets and pricing. Stokman explains that dealers should not be embarrassed by prices.

Willie VogtCat-pricing-image-tape.jpg

PRICES ON EVERYTHING: From the utility vehicle on the show floor – retail price $15,380 – to this Cat tape measure for $16.99, the new retail model is prices on everything to make it easier for the buyer.

In fact, the price story is more evolved for Caterpillar. Stokman acknowledges that for many smaller company buyers Caterpillar is an “aspirational” brand. Something they want to own someday.

The key is overcoming that “future” thought and providing a true look at equipment value. That up-front price is just part of the value ownership picture. “We want the customer to look at the entire ownership and operating costs of the machine,” Stokman says. “They need to know they can get a part quickly, or fast service, if a machine goes down. We want them to think beyond the monthly payment.”

Dean Margonis, inside sales representative, Carolina Cat, Charlotte, N.C., shared that this new approach is making a difference in his company’s dealership. “So many local contractors were driving by our facility because they didn’t know we had equipment,” he says. “We want to be more approachable for the customer.”

Carolina Cat is seeing a boost from that customer base, and the company is just getting started with the new retail approach. Stokman says all U.S. dealers have committed to the new approach and will implement the store redesigns and sales training in the next year.

When we think of retail, we don’t often think of the local equipment dealer, but in this up-ended online-buying world, every business needs to look at how it connects to the customer.

Willie VogtCat-alex-stokman.jpg

SHARING THE STORY: Alex Stokman is heading up Caterpillar’s effort to reshape the retail experience for dealerships. It’s a big effort that’s already yielding results for the company.
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