The Corona crisis holds the entire world in its grip, and naturally, it also dominates our interview with Pedro Correia, the CEO and senior partner of Portuguese company Refixe. Apart from the virus outbreak, we also discuss other current trends and developments that impact the erotic retail trade in the Southern European country.
In view of the current situation, we have to ask: As a retailer, are you feeling any effects of the rampant Corona virus? Is the current situation dampening the consumer mood in Portugal?
Pedro Correia: We have noticed that sales have dropped compared to the same period last year. In Portugal, people are as worried as they are in any other country. Most of our sales are online, but the economy is requesting a shut-down of many services.
There is already talk in some media that there will be a shortage of products and that the situation could lead to an increase in the price of sex toys. Is this realistic in your opinion?
It’s a possibility, like in any other business. We are not manufacturers, so we have to rely on our suppliers. If their orders are not fulfilled, ours won’t be either – and neither will be the ones of our clients. It’s a matter of supply and demand.
The virus is already affecting the global economy, and the spectre of a downturn is on the horizon. Are you worried that this could affect your domestic economy?
Yes, as we are part of the global economy. One of the main Portuguese industries is tourism, and leisure and recreation are not at people’s mind when an economic crisis arises.
Now let’s talk about more pleasant things: Which trends are having an impact on your customers’ shopping habits at the moment?
Yes, please! The new trend is a payment method our clients can choose: MBWay. It is very simple to use, and safe for both the customer and the retailer. The costumer receives a message on his/her phone with the payment request, and once he/she accepts it, the retailer immediately receives the payment. As far as toys are concerned, clit suckers such as Satisfyer and tipper vibrators are the new black.
Two product categories have seen an uptick in demand in recent months – toys for men and sex dolls. Is there a strong demand for these products among your customers as well?
We have a couple of premium sex dolls available, but the price range is quite high for our country. Fleshlights are always a must-have, and the new range of male masturbators, small and handy as they are, have been a top seller.
There is also a discussion about the many private labels and private label products that are coming onto the market. Being a retailer, what is your take on this? Does the market need strong brands? And is there such a thing as brand loyalty among your customers?
Our main focus is to brand ourselves, not so much to have labeled products. Our sex positive approach is also showing in the brands and suppliers we make available to our costumers. At the moment, we have partners in social media branding our company – mainly Instagram, working with sex advisers and influencers.
“Our main focus is to brand ourselves, not so much to have labeled products.”
You pursue a dual strategy of walk-in retail and e-commerce. How do the two compare? Is e-commerce growing while bricks & mortar retail is more or less stagnating?
Having a brick & mortar helps consolidate consumer trust in an online business. In our particular line of goods, the adult market, it’s true: E-commerce is growing because sex toys are still a taboo. And yes, I agree that growth is showing in the e-commerce while the traditional stores keep the same costumers.
How would you describe the target groups for these two channels? Do you serve customers in your online shop differently than the ones who come to your bricks & mortar shop? Are they two separate groups or do they mix?
Actually, they mix. The online customers have it easier as they can shop anywhere in the world, and we can deliver the goods to their doorstep. But demographics are mostly the same between the two channels. In fact, I’m considering opening a new and smaller branch. A Vibrolandia Kiosk, also in Sintra.
What about the factors that influence the customers’ purchasing decision? Are there differences in this respect between e-commerce compared and bricks & mortar retail?
The payment methods are the same, as well as the products. The main difference is the comfort option: the pick-up stores we have around the country (more than 600 ate the moment), the 24h delivery to any address in mainland Portugal, and express delivery to almost anywhere in the world. If you are not in Sintra, you would choose to buy online.
Looking at your retail activities, what are the biggest challenges you face at the moment? Growing competition? Consumer restraint? Profit margins?
No, yes, and yes. We have been in the market for over a decade, and we have managed to stay ahead of the competition. But global economics – including profit margins and suppliers’ response – are the biggest challenges we are facing.
What are your plans for the coming months / the rest of 2020?
Our plans are to keep calm, but vigilant. We are Portuguese.