Island Life
Hi Friends!
Last week, Mecum Auctions announced another 9-figure overall result. This time at their Indianapolis, Indiana sale. Although down slightly, this has been consistent for them in this location for the last several years. In a time where the market is beginning to cool, this is definitely an accomplishment and it’s not just because they did it, but how they did it and how they did it is likely why they will likely continue to be able to do it as well.
About 10 years ago, while acting as VP of Marketing and Media for a competing auction company, I noticed that Mecum was clearly up to something. A high volume of seemingly random events in relatively unsexy locations never looked like a quick attempt at a cash grab for me. Win, lose or draw on site at the time, what they were really doing was developing a captive audience. They were reaching out to people that nobody had reached out to before, they were educating them, introducing them to the hobby and the process therein and in turn were cultivating security for their brand along the way.
While their strategy may have been unique, this overall approach is nothing new (particularly in the auction space). Barrett-Jackson’s Scottsdale auction has largely operated in the same manner. However, as we all know, they built their path by means of innovations in mass media and the results continue to speak for themself there too. Even as everybody else struggled in Arizona this year, Barrett-Jackson Scottsdale generated over $200 million in sales (capped off by a top seller that made virtually no sense to anyone).
One can make the argument that the way that they keep achieving this is by increasing their volume of offerings, but this is largely irrelevant due to the fact that they can still even do that in the first place. They have multiple options and multiple roads to take to accomplish their objectives and very few companies can really manage that easily.
For the last several years, I’ve been referring to this as “Island Life” and not only are these two auction firms living this way, but there’s a handful of national dealers that have joined them as well. At the end of the day, the fact remains, that things that occur (both good and bad) at companies like this have zero real reflection on what the market is actually doing and the things that occur surrounding them happen no place else. For them, this is a very, very positive thing.
Think about it. How many times have you run into somebody who has specifically named one of these entities as a component of a bucket list experience?
Example: “A 1970 Chevelle is my dream car and someday I’m going to Scottsdale to buy one at Barrett-Jackson.”
We’ve all heard this. Probably a lot over the years, too.
Fact is, these companies have become such a significant fixture of the mission for so many people that they’re not only willing to travel, but to spend whatever it takes in order to get that mission satisfied. As a result, these companies are able to insulate themselves from negative market fluctuations, simply because people are willing to invest in their brands so heavily. The market, distance, etc. becomes an afterthought and everything else is ignored.
For the companies that accomplish this, this is a true master class in branding and it’s something that is scalable in nearly any direction and for nearly any type of company. Develop your customers as they come into the space, educate them and then provide them with an aspirational experience to work towards.
This is building yourself an island and for that, you get to enjoy the rewards.
That’s it for this week…
Darin Roberge