With 148 stores, ORION Fachgeschäfte GmbH & Co KG remains the leader in the adult brick and mortar segment in Germany. In our interview with Jens Seipp, the company’s head of marketing and communication, we talk about the developments in the adult market, competition from the internet, service and advice as main pillars of the brick and mortar trade, consumer behaviour, and the fact that old dogs sometimes still have a lot of life in them.
Jens Seipp, what kind of a year was 2017 for ORION Fachgeschäfte GmbH & Co KG?
Jens Seipp: Looking back, we can definitely be happy with the business year 2017. We have been on very solid footing for several years now, and many of our stores managed to increase sales by a significant margin. That makes us very optimistic as we enter 2018.
What is your explanation for this development?
We put in a lot of hard work in order to offer our customers a great product range and a pleasant, inviting sales environment. Apart from those two factors, the sales staff in our stores also played a major role.
How many ORION stores are there in Germany at the moment?
Currently, ORION has 148 stores across Germany, making us the market leader in the brick and mortar segment there.
Let’s analyse the competition: Was e-commerce once again the big winner of 2017?
The e-commerce segment has never been the measure of all things. Even if many people choose to ignore it, adult shops on the internet have a big problem – they are not really close to the consumers. There is very little going on in the way of advising customers, and as a result, a lot of potential sales are not being made. This is where the brick and mortar retailers have to pick up the ball, playing on their strengths by providing direct contact and qualified advice.
Today, it is pretty obvious that consumers use both channels, and in the end, the decision about where they buy – online or in a store – is often made rather spontaneously. There has always been competition in this market, and we are pretty confident and relaxed going forward in this new year.
“The e-commerce segment has never been the measure of all things.”
If statistics about German consumer behaviour are to be trusted, 2017 was more about spending money than saving money. Did you also notice this consumer confidence in your stores? Does people’s willingness to spend money also extend to adult products?
I think, general trends always worm their way into the adult market. And there are many things that influence consumer behaviour. There were several broader developments in the past years that had an impact on our business. For instance, there was the refugee crisis in 2016, which did lead to a certain degree of consumer reticence and uncertainty. But that faded away rather quickly throughout 2017. Maybe that’s why we think that consumer behaviour was so enthusiastic this past year.
Markets change, so do consumers; sometimes too quickly for the trade members. ORION Fachgeschäfte GmbH has been a leader in this market for 55 years – how do you manage to adapt to the changing requirements and expectations of the adult market time and again?
I think that in order to persist in this market, you need the right mixture of being willing to change and sticking to your guns and your previous experience. For brick and mortar retailers, this also means putting a lot of work into their stores and also putting a lot of work into winning over the customers. Our standards in terms of store design have changed quite a lot throughout the past years.
The products and the presentation have to be in harmony, and the external image, i.e. how the store looks from the outside, also has to fit. This is a continuous process that never really ends; in the retail trade, nothing good has ever come of resting on your laurels and the successes of previous years. Ultimately, there are many, many little building blocks that need to be combined to achieve success in this business.
When people in the industry talk about ways to engage the consumers, you often hear terms like multi-channel marketing, omni-channel marketing, etc. What about ORION? What is your focus in this world of near-unlimited channels of communication and distribution?
One of the big advantages of ORION group is our level of specialisation in both, the online and the offline segment. Each of these segments comes with its own set of requirements, and we have experts who focus on exactly those factors. ORION customers can count on a strong adult brand, in both worlds. And that is also how the company is perceived by the consumers.
Not so long ago, many people predicted that the brick and mortar trade was marching toward a slow, but inevitable death. How would you describe the current status of the walk-in retail market? Is there still potential in this business model?
Yes, I am sure everybody has heard these campfire stories about the demise of the walk-in retail trade, but I am under the impression that these premature ‘obituaries’ for the brick and mortar trade have quieted down quite a bit these past months. I think many people are starting to change their way of thinking. Online retailers want to get closer to the customers and try to do so by opening their own stores or setting up pop-up stores. That should be proof enough. There is still potential in the brick and mortar trade, no doubt about it.
Some call 2017 the year of ‘toys for men’, others believe sex tech and teledildonics to be the big trend of last year. What category was more successful in your stores?
As far as I am concerned, the big trend was high-quality toys. Craftsmanship, materials, features – that’s what people are looking for. And yes, things such as app control or customisation options definitely play into that. Also, men are particularly open to new pleasure technologies. We have many products in this category, which has grown and evolved throughout 2017.
Catering to women is nothing new for ORION, it is pretty much a company tradition. However, the main target audience nowadays seem to be couples. Is there something like a ‘typical’ ORION customer? Has your clientele changed a lot over the course of the past years, as sex toys, etc. have become more and more societally accepted?
Everything changes, including the customers. The cliché that you’d only find older men in big coats and hats in adult stores, hasn’t reflected the reality in a long time. The beauty of this business is, there is no typical customer. From academics to construction workers, from 18-year old men to 90-year old women – there is such a wide and wonderful variety of people who come into our stores, sometimes alone, sometimes with their partner or as a group. Shopping at ORION is fun, and it is perfectly normal. People don’t feel awkward when they enter the store, and that is something we are proud of.
“From academics to construction workers, from 18-year old men to 90-year old women – there is such a wide and wonderful variety of people who come into our stores, sometimes alone, sometimes with their partner or as a group.”
For years, there has been a discussion about brands in the adult market? Some even doubt if this market needs brands at all, while others swear by them. What is your take on this topic? How does ORION Fachgeschäfte GmbH feel about brands?
Well, first of all, we consider ORION to be a brand itself. And our consumers definitely look at ORION as a brand. As for your question: Brands create trust and acceptance. Therefore, we need brands in the adult industry, and we need the message they convey. So, yes, I absolutely believe that brands are a boon to our market.
Which factors affect the consumer’s purchasing decision? What are the customers in your stores looking for?
In my opinion, a good combination of store atmosphere, quality products, and professional sales team goes a long way. More sophisticated toys often require some explaining, and the consumers appreciate it when there is someone on hand who can lend knowledgeable advice.
Your company relies heavily on a competent, female sales force. Is customer service becoming the single-most important aspect to set walk-in stores apart from online shops, or is this just one of many pillars on which the brick and mortar trade rests?
As far as we’re concerned, this is the single-most important factor in our daily work – actively supporting the customer throughout the entire shopping process. This is not just about the service or the sales advice itself; there are so many things that are easier when you can interact with a person. For instance, returning a product. In a store, you usually find a solution that is in the customers’ interest. The consumers know and appreciate that, especially if they had negative experiences in the online market. At any rate, that is the general tenor from our customers.
Can you tell us about your plans for 2018? Do you believe there will be big changes in the German market for adult products? For instance, what kind of impact will the third Fifty Shades of Grey film have?
We will continue to try and combine the tried and true with new ideas in 2018, further pursuing the strategy we have set out on. The third movie in the Shades of Grey series will definitely create a certain amount of attention and curiosity, and we are ready and well-prepared to meet that demand. As a matter of fact, we are currently working on several campaigns, but of course, I won’t spoil the surprise just yet.