Tom Hicks' niche market knowledge has turned Southern California Motorcycles into a sales powerhouse
Tom Hicks knows the curious brain of the true enthusiast. He understands the zeal with which the real Ducatisti embrace their chosen brand. He relates to the passion felt by the Triumph RATs for their beloved Brit Iron. The Victory faithful? He's learning.
It's the niche, the fringe, that is Hicks' forte. After all, the industry veteran and regarded dealer knows what it's like to be obsessed. He is the consummate enthusiast who, like many of his customers at Southern California Motorcycles, knows what it's like to be so into a niche brand or specialty sport that nothing else matters. They're the ones who would love nothing more than to be dipped into a vat of liquid Ducati and left to smother in all that lovely Italian goodness.
This goes a long way toward explaining the newly redesigned Ducati showroom in Hicks' Brea, Calif., dealership. In partnership with Ducati North America, Hicks recently remodeled one-half of his store into a massive tri-colore retail space fairly dripping with the Italian marque's historic brand. It's Ducati from bike to boot, with every piece of PG&A screaming all Ducati, all the time, and large images of the company's storied past covering the walls.
While he initially had all of his brands under one long roof, the remodel allowed Hicks to relocate his other brands, Triumph and Victory Motorcycles, to their own standalone mini-dealerships within the funky, nondescript business mall.
"Here is my concept: An enthusiast, when he walks into a store and sees exactly everything that he can imagine for the sport or whatever he's totally into, his jaw hits the floor and he never has to go anywhere again," Hicks says. "When I opened the Triumph-only store in 2000, I did exactly that with the money that I had. People would walk in the door and all they would see are Triumph accessories, Triumph apparel and Triumph motorcycles and their jaws would drop."
Now, he's done the same thing with his Ducati line.
In effect, Hicks' dealership is directly reflective of his understanding of and passion for niche markets, a specialized piece of business acumen that dates back to his years of running successful darts and archery stores — not exactly mainstream sports. It also mirrors his personal passions that include flying, endurance road-racing and trials riding.
"It's a matter of giving the people what they want," Hicks says. "This is not the transportation industry. This is the entertainment business and the dealers who do not understand that wallow in their own problems."
Ducati NA picked up on this when identifying stores to include in its dealer-by-dealer network upgrade. In addition to Hicks' stellar record in selling the brand, his enthusiasm and determination made him a standout pick for one of the OEM's floor-to-ceiling remodels, says Michael Lock, Ducati's CEO. Thus far, the manufacturer has made over about seven dealerships around the country, including the 2008 Dealernews Top 100 Grand Prize winner, Erico Motorsports in Denver, Colo.
"Orange County/Southern California is by far our biggest market. We knew it was critical that we did it well," Lock says. "Tom's was probably the most ambitious project we've taken on yet."
STEEP LEARNING CURVE
Admittedly, Hicks knows that being a die-hard enthusiast isn't the best approach for a businessman. As is evident in the history of the motorcycle market, the two often don't mix. Even in the timeline of Hicks' business life, success of one kind or another has fallen victim to his passions — and it was a helluva learning curve.
While the dart store was a huge success, the archery store went bust. And then there's been more times than not where Hicks dug into the red to keep his business in the black. But it's always been his passion and his belief in himself that have driven him through the bad times.
"I'm very, very fortunate that somehow I was able to transcend from enthusiast to businessman. It cost me two wives and a bankruptcy but I was able to transcend that," he says. "Now I can honestly say I am a businessman. But, I am still truly that enthusiast."
Hicks says he's counseled those looking to get into the business with a very realistic lesson that the learning process costs money — and that it's a kind of tuition that must be paid. But if they've got the means or the wherewithal to withstand long periods of lots of problems, they should do well. If they don't, he adds, it might be best to go work for someone else and let that enthusiasm flourish.
In staffing the store, Hicks looks for those with high levels of enthusiasm for the brands he sells, a necessity for such a lineup and for the dealership in general. "You've got to know your product or, as a businessman, have people who know your product. You can't allow the customer to walk in the door and know more about your product than you do. If you do, you have lost an incredible amount of credibility," he explains.
To attract high-level employees, Hicks pays what is called competitive-plus wages or pay that's a little higher than what his competitors pay their workers. Once hired, employees are reportedly treated well. For example, at last-year's Christmas party aboard the Queen Mary in Long Beach, Calif., he gave out $27,000 in gifts and perks to about 21 employees. Hicks says happiness is one employee trait that he notices many other dealers miss.
He also invests heavily in educating his workers. "I spend thousands and thousands of dollars sending all of my employees all over the country for training," Hicks says. "Everything from F&I seminars to parts seminars to all of the technician training of course. My sales manager is constantly getting new sales course [information] for the sales staff."
It's all about professionalism, he says, adding that he even uses pricier embroidered shop shirts to outfit his staff and keep them looking good. This approach extends throughout the entire dealership. Hicks employs one person whose sole job, 40 hours a week, is to clean the store.
"People don't understand that if someone comes into your dealership and it's a s---hole they're not going to say anything," he says. "They're not going to tell you, 'Oh this place is a s---hole.' They're going to walk around and ... they might even buy something, they may not, and then they're going to leave. And in the back of their minds, [they'll think] "That place is a s---hole.'"
OUT WITH THE OLD
Given the dealership's small size, Hicks focuses the bulk of his marketing efforts on Internet/online advertising and on working outside events. The store's main target is the general motorcycling audience because, as he figures, there's likely a lot of people out there riding Suzukis who dream of one day owning Ducatis.
In recent years he's decreased his traditional advertising — going from appearing in 25 different phone books to not knowing if he's in any these days — in favor of direct e-mail, Web site ads and an e-commerce site.
"People spend more time now looking at their computer than they do anything," he says. "The bottom line is if you don't stay up with the times and make changes appropriately, you're going to be the mom-and-pop shop that just goes out of business like most of them do."
Eventwise, Hicks and his staff participate in such high-profile gatherings as the Long Beach stop of the Cycle World International Motorcycle Show tour and the Love Ride in Southern California.
"Let's say we're going to do the Love Ride. We'll pass out maybe 2,000 fliers. If we sell one bike, it will pay for the event. If we sell two we're in the black. Any more than that is gold," he says. "On top of that, look at how many people who didn't know about us now do. That's the point that other dealers definitely miss."
Southern California Motorcycles is also home to the local chapters of the Triumph RAT club and the Ducati Owner's Club. The members of these two riding clubs are like walking, talking billboards for the shop. Many of these members also help out during the events, he adds. "If I have 50 people in the club I have 50 people out there talking good things about this dealership. They feel a sense of belonging, a sense of pride being we work so hard trying to be the number one dealership and they can say they're a part of that."