To see an example of a pawn shop that has done a great job posting their online inventory and integrating their online and in-store experience, check out our client Pawn King.
You know the problem all too well. Loans have left you with excess inventory that’s taking up space and needs to be sold quickly. The right buyers are out there, but how do you find them?
Millennials present a huge opportunity for pawnbrokers to close this gap, but you need to meet them where they are.
The Pawn Shops That Will Win, and the Ones That Will Lose
The pawn shops that succeed in the coming years will be the ones that successfully connect with the younger generation. And the place to connect is online.
Did you know millennials and Gen X’ers are more likely to shop while in bed or even in the bathroom than to physically walk into a store—especially at the beginning of their buying journey?
Retail stores that cannot integrate their inventory have fallen behind and are struggling to adapt, which is one reason many pawnbrokers have struggled to engage millennials. Because of the nature of their unique, one-of-a-kind items and historic reliance on foot traffic, pawnbrokers are suffering and will continue to suffer if their marketing and e-commerce strategies do not change.
We believe this problem can be solved and that pawnbrokers can compete effectively online.
What Most Pawnbrokers Are Doing
In fact, over 90% of pawnbrokers we surveyed said the biggest pain point in doing e-commerce was the ongoing labor cost of managing product listings. Even those with a pretty good handle on electronic inventory could compete much more effectively online if they had the resources to do so.
A majority of pawnbrokers surveyed currently use a POS, or point-of-sale system, other than the most popular platforms such as Bravo or Quickbooks, and at least a fourth are interested in a new e-commerce solution. With so many options to choose from, how can you discover what works best for your business?
Our goal is to save you time by uncovering the simplest solutions for an omni-channel presence in which pawnbrokers’ online and in-store inventory are seamlessly integrated.
Why Pawnbrokers Large and Small Must Be Able to Compete Online
Whether your particular pawn shop views lending or retail as its core business, all pawnbrokers rely on retail sales to liquidate unredeemed collateral. Online marketplaces like Amazon and eBay place ever-growing competitive pressure on all brick-and-mortar retailers, but they also function as important sales channels for pawnbrokers.
Electronics are some of the most popular loan securities pawnbrokers receive. However, consumer electronics lose value quickly, so pawnbrokers need to diversify sales channels in order to efficiently liquidate electronic inventory.
Pawnbrokers’ Future Customers Will Find Them Online
Since millennials are “digital natives,” they conduct nearly half of their consumer decision journey online. This new type of customer decision-making contributed to the closure of more brick-and-mortar stores in 2017 than any other year in history – including the financial meltdown of 2008. Millennials are the largest demographic group in the U.S. and represent an increasing share of pawnbrokers’ business.
With more and more customers searching for products online, pawnbrokers need to meet customers on these channels.
The customer’s buying journey used to look like this:
Adapted from Meyler Capital
In the digital age, with customers possessing more information than ever before and even using tools like PawnGuru to get multiple bids from various pawn shops in the area, the decision process looks more like this:
Adapted from Meyler Capital
By the time they are ready to buy, 50% of millennials still prefer shopping in a physical store—indicating that retailers who successfully integrate their e-commerce and brick-and-mortar stores will see greater success going forward. Modern buyers may finally end up coming to your store — but only after finding you online.
Closing the Digital Gap
Many pawnbrokers have digital platforms that are outdated, not mobile-responsive, and lacking up-to-date online inventory to browse or purchase—placing them at a disadvantage when compared with other retailers with a stronger digital presence.
There are three major components to any pawnbroker’s digital platform:
- Mobile-responsive website, engineered for SEO, which will help local customers find them and make contact for loan services and shopping.
- Digital advertising to drive local brand awareness and traffic to the website and nearby stores.
- An e-commerce solution that provides access to the largest-possible online shopping market, driving the fastest-possible inventory turnover.
Qualbe has seen strong results from building a digital platform featuring all three components.
Want to close the gap for your own pawn shop?