Thinking big in Houston: Gallery Furniture
Same-day delivery, lots of advertising and service pay off
By Lisa Casinger -- Kids Today, 10/1/2008 12:00:00 AM
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| One of the many things that makes Gallery “larger-than-life,” this replica Trojan horse graces the showroom. |
Gallery Furniture in Houston has a larger-than-life owner, Jim “Mack” McIngvale. Mack, as he’s known throughout the city and the home furnishings industry, founded his furniture store in 1981 and today it’s ranked #56 on Furniture/Today’s Top 100 retailers, with average annual sales of $134.8 million. Between 10-15% of his business is derived from youth furniture.
What’s his secret to success? Mack doesn’t do anything half way.
The retailer is well-known for his colorful, high-energy advertising, which saturates the market. Mack devotes about 10% of his budget to advertising and he blankets the market on radio, television, newspapers, billboards and the Internet.
Same-day delivery is another of Gallery Furniture’s calling cards. His goal is to deliver a customer’s furniture within two hours of the purchase. Gallery stocks everything; whatever is on the floor is ready to be delivered. The store offers all styles and all price points.
The advertising and service have helped make Gallery what it is today, but it’s also the store itself that draws customers.
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| There are about 15-20 vignettes spread throughout the Gallery youth area with an even mix between boy and girl groups. |
“It’s an experience place,” Mack said. “We have a giant playground for the kids; there are lots of interruption zones throughout the store to break things up.”
These interruption zones include everything from a huge Trojan horse, coffee shop and free range parrots to an Elvis Presley exhibit (complete with the King’s 1956 Lincoln Continental), Lady Diana’s jewelry and Houston Rockets’ memorabilia.
The store’s Web site, www.galleryfurniture.com, is as loaded with bells and whistles as the store itself.
There’s a room planner, wish list, video tours of different areas of the store, delivery information (including a YouTube video of a delivery) and, of course, Mack’s blog.
During the holidays he spends more than $100,000 setting up a Christmas tree (taller than the one in Rockefeller Center) in the store’s parking lot.
Mack’s philosophy is, “Nobody makes money when you’re just selling a commodity. You have to make it bigger than it is, whether it’s selling furniture or turning a baseball game into this incredible, fun experience, and the best way to do it is by making things fun.”
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| The King’s 1956 Lincoln Continental and other memorabilia create an interruption zone. |
Gallery has been a promotional to mid-priced store but this summer Mack added a Berg gallery to his youth department, which encompasses about 10,000 square feet, in an effort to offer higher end product.
“We’re always trying to skew up and raise the average ticket price,” Mack said. “Those $3,000 Berg bunk bed tickets really add up quickly. It’s such a unique product customers can’t shop around for it. We have it set up right in the middle of the youth area and every kid that walks into the area gravitates toward it. It’s been good for Berg and it’s been good for the lower price point products as well.”
Furniture is the bread winner in the youth department and product is displayed in 15-20 vignettes. Though the mix is divided 50/50 between girl and boy groups, Mack says dark finishes are the best sellers, across all style categories.
This has been a tough year in the furniture industry, though Mack says business is trending up. He’s worked to advertise smarter this year, he said, by doing more online advertising, and he’s working at shrinking delivery time from a six-hour window to a 2- to 3-hour window.
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| Bunk beds and dark finishes are top sellers at Gallery. |
“We’re refocusing on the customer,” he said. “The only thing that matters in the furniture business is the customer. It’s all about being relevant to them. That’s why the industry is losing business to Target and Sam’s Club. If we’re relevant to the customer and we deliver it faster and we have a better product then we’ll win; if not, they’ll go somewhere else.”
Though Houston has recently gone through a lot of tragedy, the area is growing, Mack says.
“The acid test for any retailer is: would the customer miss you if you went out of business tomorrow? We hope they would.”
For Mack, the biggest daily challenges are making sure everyone stays focused on the customer and making sure the warehouse stays clean.
“Any warehouse grows and breeds like a rabbit and excess inventory kills your margin and your profitability,” he said. “It’s a real challenge and nobody wants to do that part of the business, but, it’s a very important part.”
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| The addition of Berg products raises the price-point offerings in youth. |
He says one of the worst business moves he made involved inventory. He bought into a high-end mattress line and the vendor wasn’t able to flow the product quick enough.
“It flopped,” he said. “It was my fault; I jumped into it too quick. So, we sold the inventory at half cost, took our licks and moved on. That’s all you can do. If you have bad inventory you have to get rid of it because it certainly isn’t going to get any better.”
Mack now carries youth mattresses from a local vendor, Noah, as well as Tempur-Pedic.
Though Mack is well-known for his P.T. Barnum-like persona and success, he’s also known for his philanthropy.
The recent hurricane knocked Gallery Furniture out for about a week but even then there was limited phone access and they were back to delivering furniture in no time.
This year the store began a partnership with the USO; it’s actually a WorldWide Strategic Partner with the USO. It started when Gallery Furniture decided to help refurnish, redesign and revitalize the USO Center at Houston’s Hobby Airport and then Mack decided to “redo them all” — 130 centers around the world.
Gallery also is working with the USO in its mobile canteens working on the Texas Gulf Coast, helping families hit by Hurricane Ike.
The list of the store’s community involvement and giving is impressive. Gallery Furniture typically gives away 15 households full of furniture each Christmas; it underwrote a YMCA playground at Reliant Stadium for Katrina evacuees; it housed hundreds of evacuees during the Katrina crisis; sponsored the Pilgrimage of Faith sending 500 kids and chaperons from the Galveston/Houston Catholic Dioceses to Rome and the list goes on and on.
If you Google Jim McIngvale and Gallery Furniture you’ll find story after story about his philanthropic efforts; you’ll discover he wrote an autobiography, “Always Think Big”; he’s listed in Wikipedia; and, he’s a bit of a controversy because of what some call outlandish ads and his frank nature. Regardless, you’ll also discover that he’s dedicated not only to growing his business but also his community.
After 27 years in business, Mack is finally looking to “expand his footprint in Houston. He’s opening a satellite location in the Galleria mall area possibly by the end of October (the opening date was set back because of the hurricane). Though not as big as Gallery, the satellite store is 22,500 square feet and Mack said this location will include an upscale version of the store as well as a dedicated Kreiss furniture gallery.
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