People that don’t quite get the thrill associated with skydiving often ask: "Why jump out of a perfectly good airplane?” In this week’s Retailer Spotlight, we’ll learn why Danny Govberg, president of Pennsylvania's Govberg Jewelers, is moving out of a perfectly good store to open a new one in a nearby upscale lifestyle center.
Last year Govberg made a decision to get an iPad. Like most shoppers, he went to the nearest Apple store to purchase one. What Govberg didn’t count on that day was learning of an opportunity that would alter his business plans for the rest of career as a retail jeweler.
When Govberg walked in to the Apple store at Suburban Square, an upscale lifestyle center in Ardmore, Pa., he noticed the adjacent retail space was vacant. “I was familiar with the lifestyle center, and even inquired about renting a retail space in it,” says Govberg. “But that was a few years ago and I didn’t like the open locations at that time. But with the retail space directly next to the Apple store open, I knew it would be a tremendous opportunity for us.”
As much as Govberg liked the idea of having a high-end watch and jewelry store next to an Apple store, he didn’t want to open a fourth store. (He currently has three stores, including one in Philadelphia's Center City.) Govberg decided to move his Bala Cynwyd store three to four miles to the Suburban Square location next to the Apple store. He’s looking at a mid-March or early April 2012 opening for the new location.
In business since 1922, Govberg has been in the Bala Cynwyd location for nearly 25 years. The location is good, and sales have been good. Govberg and his staff even had a very profitable holiday season. But the store is in serious need of a makeover—the cost of which Govberg estimates is close to that of opening a new store.
Like many retail jewelers, Govberg uses the same promotional vehicles to keep in touch with existing customers while trying to attract new ones. But Govberg is looking to keep his current customer base by conveniently relocating the Bala Cynwyd to a new location less than five miles away, and attract new customers by virtue of sharing a wall with an Apple store.
Apple stores are known not only for their one-on-one customer service, but also for their inviting store design and visual merchandising elements that appeal to both PC and Mac users alike. In 2010 and 2011, Apple stores attracted 70 million-plus visitors nationwide. Tapping in to that foot traffic potential at the Suburban Square location is part of Govberg’s long-range, 10-year plan.
With Christmas behind him, Govberg is returning to the task of closing one location and moving to a new one. Contractors are busy with the Suburban Square build-out. And sometime after Valentine’s Day he plans to host a moving sale. When he’s ready to open the new location, says Govberg, “We’re looking to make it as simple as closing one location on a Saturday and opening the new store on a Monday."
In terms of square footage, Govberg and his staff will have almost the exact amount of showroom space at the new Suburban Square store (3,300 square feet). Once Govberg has settled in the new location, he will begin another transition: changing his product offerings.
“Currently we’re 85 percent watches and 15 percent jewelry,” says Govberg. “Over the next three to five years, I’d like to change that mix to 30 percent watches and 70 percent jewelry.”
Govberg sees the move to the new Suburban Square spot as way of bringing in new customers at a time when he’s looking to make a substantial change to his business model to carry more high-end jewelry with notable designer lines.
For now, he’s concentrating on the transition and is looking forward to being neighbors with the Apple store. But Apple isn’t the only big name in the Suburban Square lifestyle center. Other neighbors in the 360,000-square-foot center include Banana Republic, Victoria's Secret, Trader Joe’s, J. Crew, Ann Taylor, and Macy’s, to name a few.
And of course there are the obvious benefits of the proximity to his hip new neighbor. “If we need anything for our iPods, iPads, or iPhones we can go right next door,” says Govberg.