Q&A with Brad Anderson, Brunswick fiberglass recreational group vice president of marketing and planningPosted on Written by Reagan Haynes
Although hes one of the marine industrys youngest executives at 35, Brad Anderson has been working in all areas of boating for 20 years 12 of them at the Brunswick Boat Group. He grew up on a Wisconsin lake and has a long boating past.
It gets in your blood and its difficult to get out of it, he says.
Anderson recently was named marketing and planning vice president for Brunswicks Sea Ray, Bayliner and Meridian brands. His marine industry career began at a Wisconsin dealership where, as a junior high school student, he did everything from cleaning boats to rigging, delivery and sales and, eventually, running a parts counter.
Its good to [get] that perspective on working with customers in a dealership before switching to the manufacturer side, he says.
Anderson continued to work at the dealership and one other until he joined Brunswick as an undergraduate student. He has since held various roles with increasing responsibility.
Anderson started in a rotational financial leadership program, shifting positions every six months. He began in corporate finance, then went to Sea Rays Merritt Island, Fla., facility, spent time at Sea Rays headquarters, mergers and acquisitions and corporate finance again. He landed in sales and distribution when the company combined its aluminum fish and pontoon and Bayliner sales teams into a single entity, where he focused on distribution strategy and marketing.
That led him to become president of Harris FloteBote and Cypress Cay Pontoons, and now to his new role.
He holds an M.B.A. from Northwestern Universitys Kellogg School of Management.
Q: What do you bring to the table in your new position that wasnt there before, and how do you see your role moving forward? Does your age give you a unique perspective?
A: I think each person has a different background and experience, and that shapes their vision and approach to leadership. Its healthy to have a diverse collection of backgrounds because it constantly pushes us to challenge each other and stay relevant.
I think understanding the retail and dealer side [as well as] the manufacturer side is helpful, as well. Theres a ton of interaction that goes on there. As a brand we may have good ideas to reach consumers, but we have to make sure that were collaborating and communicating with our dealers to get the full benefit of that.
Q: I know the dealer network has been a strong focus for the Brunswick Boat Group in general.
A: Correct. I think were fortunate to have, in our perspective, the strongest dealer network in the industry. As a brand, we want to promote the overall boating lifestyle and support the consumers entire experience, from the point of consideration to the buying process to post-purchase. While we can influence and control a lot of those aspects, were really heavily dependent on the dealers, just as they are on us, and collaboration is important. Brunswick has been fortunate through the difficult economy to maintain the majority of our dealers and our brands, to benefit from that continuity and remain strong from a financial perspective. We have a long history with our dealers, which helps just because we know each other so well.
Q: That must have paid off after the overall industry lost so many dealers.
A: Yeah, the ranges you hear are that there are 25 to 40 percent fewer dealers in the marketplace, and as a whole the Brunswick Boat Group has actually increased the number of dealers we have. Id even say we have a stronger dealer network. If you go back to my days in Harris FloteBote and Cypress Cay, we signed more than 100 dealers in a three-year period and some of the best dealers in the world.
Q: I had heard that when you went to Harris FloteBote and Cypress Cay you were tasked with assessing whether it was a viable part of the boat group. Can you talk about what you saw happening in the pontoon segment?
A: I started in the fall of 2009, which was near the bottom of the downturn for the pontoon category. And because Brunswick was being prudent we were assessing all of our businesses. It didnt take long to realize the team was extremely passionate and capable. Both brands were strong, albeit somewhat regional. Harris FloteBote was strong in the Midwest, California, Texas, but maybe not as diverse across North America.
At the time, many of our dealers were inquiring about pontoons, given the recent consumer interest. At the same time, other categories were still struggling. Consumers were interested in pontoons and our dealers were looking to expand their revenue, so it didnt take long to realize it could be a powerful business for Brunswick.
Within the first six months we all had created a comprehensive business plan on increasing brand awareness for both Harris FloteBote as well as Cypress Cay while updating the entire product portfolio. During the three years I was there, every model had been significantly updated and many new models introduced. At the same time, we were able to exploit the market growth in pontoons, so we had some wind in our sails coming out of 2009, and that helped. And we also had a robust distribution plan, signing more than 100 dealers. Our marketing activities and products resonated with consumers and we were able to more than double that business. If you look at SSI data from 2009 through 2012, its almost triple in that Harris FloteBote business. Its a growing part of the market, and Brunswick will continue to invest.
I think thats a really positive story for Brunswick across all of our brands. Although we had to be really prudent about where we spent our money, they realized pontoons was a growth area and were willing to spend money on marketing, building the team and coming out with new products. At Harris, theyre close to looking for and relocating to a much larger facility now. With Sea Ray, you saw at the Miami Boat Show that we introduced our Next Wave initiative, so its the same thing on the product side. If you invest in new product that gives consumers a compelling reason to buy, you can be successful even in categories that arent growing as much as pontoons.
Q: How does Brunswick stay on top of consumer buying trends?
A: We have a goal to provide the products most requested by our consumers. Weve recently kicked off a study on that just to better understand the buying behavior of our customers, as well as demographics and where those trends might go in the future. Im not sure if 10 or 15 years ago people wouldve foreseen the shift in the size of the pontoon category and the growth it would see, relative to the rest of the industry. Similar comments could be made around the jetboats or outboard propulsion. We were aware, and you can see that in the investments we made a number of years ago to get there. If we can always stay out ahead of that curve and provide what consumers want, well be a winner in the marketplace.
Q: How do you balance some of the evolution of demand and some of the short-term buying trends with longer-term changes in demand?
A: Its a balance that any company has to strike. You have to manage the short term and the circumstances that are in play against the long term. You see that with our entrance into jetboats and the Bayliner Element. From a short-term perspective, well adjust to make sure our dealers stay healthy and profitable. From a long-term perspective, some other manufacturers have had financial difficulties, and were fortunate to be a part of Brunswick Corp. and have significant financial means, where even during the downturn, as we were right-sizing our business, we were able to make the strategic investments that have set us up for growth. Youve got to make sure you dont have too short-term or too long-term a perspective and strike the correct balance.
Q: Do you think jetboats have the potential to reach new age demographics, and if so, why?
A: I think so. If you go back 10 or 15 years to the earlier days of jetboats, they were closer to PWC than true runabouts. I think our lineup a 21-foot and a 24-foot model can blur the lines between runabout buyer and jetboat buyer, especially when you come to age and budget, because you can still have the performance and handling characteristics of a jetboat. Other manufacturers do make smaller ones, but the ones we have are a great marriage between jet propulsion and the Sea Ray fit, finish and quality that nobody else has.
Theres been significant growth in that category in the last 24 months. Were the first new marine option in jet propulsion in about a decade.
In general, I think they do lean a little bit toward that younger demographic. People like that performance characteristic we talked about. Its got a bit more sporty style, unique access to the water at the transom and shallow water clearance, which helps in some applications.
Q: What are the price points of those vessels and how does that influence the buying demographics?
A: At retail theyre about $35,000 to $50,000, depending on options, horsepower and size. I think if you look at that next to a comparable alternative, whether its us or the competition, theyre at a slightly lower price point, and generally a younger consumer is newer in career and has less income, so there is appeal there. Theres a lot of financing available thats focused on payments to help give access, from a financial perspective, to those boats, which is a unique way of marketing to the consumer. You saw that on the Bayliner side. The Bayliner Elements a great example of giving customers an option for $13,999 or less, fully outfitted, and $150-per-month payments or less with zero down.
Q: How has the Bayliner Element been doing?
A: Its one of those models that exceeded even our plans. A ton of customer research went into that product, so we understood the maximum size it could be to be trailerable on a smaller vehicle, and we knew there was a certain price point we needed. That research factored into the engine we put on it, the features we put on it and its unique hull design, the M-shaped hull, which gives it a little bit more stability. That was especially important to younger families with children in the boat. They want that boat to be stable and to handle correctly. It has resonated great in the marketplace. Demand is outstripping supply, and we continue to make more tooling and increase our production rates. That boat has been an absolute home run for us and for the Bayliner brand.
Q: Has availability been an issue?
A: I wouldnt say availability has been an issue. Were continuing to ramp up to meet that need. Any time you launch a new boat, naturally youre going to generate demand that takes a little while to get up to, but we are increasing above what we planned to build on that product.
Q: What are other examples that market research showed you that people wanted on the Element, and did you pointedly study different ages or other demographics in conducting your research?
A: We wanted to look across demographics, whether age or income, and areas of use on the boat. The way someone in Florida would use the boat is different than the way someone in Wisconsin would, so we studied each of those and thats what drove design, features and options until we ultimately arrived at the price point we wanted to hit. We feel the value proposition of that product is unlike anything else in the marketplace. And a younger buyer is likely to be interested in that boat, given the price point, but it also appeals to people who, as they become busier, have to make tradeoffs in their leisure activities.
Q: A lot of families have two parents working full time, kids who are involved in more activities than ever before. How does the availability of certain products play into the ability to attract people when the competition for time seems fiercer than ever?
A: Definitely boating competes with other activities. The industry needs to make the boating lifestyle as compelling as possible, and there are a lot of ways to do that: through our products, ease of use and access to water, and those are some of the trends we need to monitor at a high level. While the age of the average boat buyer is increasing, there are still new people entering. Theres a dynamic group of younger buyers. We know when people start boating they stay boating, so the more people we can get interested in it is important. If there are any barriers we need to remove, such as busier lifestyles, how can we make it simpler to operate a boat and to use it? How can we give them more access to water? That can be dealt with through partnerships with dealers and marinas and by exploring new alternatives that are coming into play with boat clubs, for example.
Because families are busier today than in the past we need to ensure that boating remains affordable as theyre trying to balance a lot of things. If youre trying to do 10 things that all cost something, it can add up to a large amount. That said, family budgets vary greatly. Whats excessive to one family is relatively inexpensive to another, so we need to give them compelling reason to buy.
Sea Rays Next Wave initiative is a good example of us providing new products in order to do that. Its a 20-month commitment to redefine the boating experience across every platform that we participate in through innovation. Boating competes with other leisure activities, so we need to make [it] as compelling as possible through our products, ease of use and access to water. We will monitor these trends and ensure we are aligned with todays consumer.
Q: You guys have definitely been rolling out a lot of new products.
A: Right. And part of what we launched in Miami with Sea Rays Next Wave is a bit of the tip of the iceberg. What you guys are going to see regarding the ways we interact with consumers, and using technology to get our marketing message out there, is going to be new and innovative to the industry. You can also see it in the new products and what we have in the pipeline. Throughout the downturn Brunswick has continued to invest in all that new product that will be entering the market in the coming months, so its a very exciting time with the fiberglass recreational brands and all our other Boat Group brands.
Q: I know you have to be careful in how much you share, but Im interested in hearing more about everything you just said.
A: We do need to be careful, but there are trends that well play. The sport yacht and yacht market has remained strong. We came out with the 510 Sundancer, and youll continue to see our yacht and sport yacht portfolios come out with new, exciting and innovative products in coming months. In addition, Sea Ray truly has the only premium outboard deckboat in the market. If you combine that with the value proposition from the new Bayliner deckboats that came out, well continue along those lines with all the things we have in the works. We are spreading that across all our categories, which is exciting for us. Its not, This year well come out with large boats, next year small boats. Were actually going to have a cadence of frequent new products across all of our categories. In July well probably be able to give you an update on a handful of the new ones that will be coming out this summer and fall.
Q: You referenced some new ways of marketing and getting your message out. Is there anything more you can tell me about that?
A: With our Sea Ray Owners Club, we probably have the most powerful owners club, with close to 200,000 members in the industry that we can interact with, create brand advocates, communicate and engage with. Sea Ray Launchpad is a dynamic email where we can get the message out about our products and about boating in general, so well continue to do that. As we launch some of the new, bigger boats, were going to be employing some new technology, and I wont give away all our plans on that, but its going to present some very interactive and engaging ways for consumers to view the boat without physically being on the boat. That will be something new that has been used in relatively few industries and that we havent seen to date used in the boating industry. Social media and how we engage and market to consumers will continue to be important. User-driven content helps build our brand equity, so well continue to focus there. Well be coming out with some website enhancements and some all-new websites for some of our brands in the coming months. Video is another area where we plan to make a big push. Boating is experiential, and still photography can make it difficult to convey some of the emotion, as well as some of the product and performance attributes, of a boat. Video is a very engaging way to do that. You see it a lot in the auto industry. Its a good way to really convey your message while also controlling it and making it compelling.
Q: Prior to Sea Rays entry into the outboard deckboat segment, there was very little competition. The segment has done really well. How long have you been looking at that market, and is it too soon to gauge the response?
A: Those boats were just launched, so theyre just hitting showroom floors and consumers now, but there has been a great response. Theres limited competition in that and its a growing market. Sea Rays uniquely positioned, being the only truly premium outboard deckboat. Deckboats, in general, offer a versatile platform due to the stability and larger spaces youd see on a pontoon, but they still maintain the performance characteristics youd get in a traditional bowrider. We also have the Bayliner brand, which announced at last winters boat shows an entire new line of outboard and sterndrive deckboats, and theyre uniquely positioned to offer a different value position. They provide more capacity to consumers so they can fit more people, more gear. We think having multiple brands gives us an advantage as a company as well as to our dealers.
Q: Can you talk about the overall affordability of boating and how that might influence the average age of the boat buyer, which is increasing?
A: I think everyone is conscious of their own finances, given the state of the economy right now. On some of our more expensive vessels, like the sport cruisers and sport yachts, we definitely see that financial situations are a significant reason why people are more hesitant about purchasing.
Consumer confidence and the overall economy, the housing market, job stability those are factors prohibiting them from making the purchase. I think as the economy improves, those consumers will be willing to purchase new boats. At the same time, we need to challenge ourselves as an industry to make sure costs dont get out of control and that boating does stay affordable across that range of budgets.
With the average age of buyers increasing, there still are a lot of entrants into boating as well as younger buyers, and we need to foster their participation. Boating is an experiential recreation and we need to provide opportunities to stay boating or if they havent historically participated in boating, provide them with opportunities to enjoy the lifestyle by working with our dealers to have events designed to get people on the water.
Q: Do you think boat clubs and some of the emerging peer-to-peer models that mimic the Zipcar will help foster participation?
A: I think its an interesting concept. Im a part of some teams investigating that now and well see how it plays out. Boat clubs have been around for 10 or 20 years, but are they gaining a stronger foothold?
As people have a more active lifestyle, whether through fractional ownership or club membership, I think we need to provide that access where people dont have to make the commitment. We need to better understand that opportunity and partner with our dealers to be a participant in those models instead of opposing them.
I think in the past, a lot of boat clubs have pushed the Why own? Just rent concept. I think now theres a realization that we can focus more on the freedom to try new products while avoiding negative marketing against boat ownership. Weve sold and provided boats to a number of clubs through our dealers and will continue to go to market through our dealers, but there could be more opportunities. Its great exposure for our brands and our dealers, and a lot of those members do become boat buyers. Companies similar to Zipcar are going to be interesting to watch. You see that model extend even to apartments now. A lot of people are renting their homes or apartments for a weekend or a week when theyre traveling. Its a very interesting concept, and people can do that digitally where they couldnt 10 years ago. Its relatively new to the boat business, so its a trend were following.
Q: Chaparral and Rec Boat Holdings both announced plans to enter the jetboat market. Did you see that coming?
A: We obviously saw value in the segment, which is why we invested in it. With BRPs exit, prior to our products entering the market there was basically a single competitor, so its logical there would be other entrants, especially if BRP is going to provide propulsion systems. We think its a compelling alternative for the jetboat category for Sea Ray, and were confident our products are going to be well received.
Q: What are your thoughts on the sterndrive segment? Are the sales numbers headed in a more positive direction?
A: Sterndrives have been interesting. Depending on the size, certain categories like pontoons and aluminum fish have recovered faster than others, like traditional small runabouts. That market has been a bit more difficult, but well continue to monitor it and were seeing some good signs in our new products. Our larger runabouts are performing very well.
This article originally appeared in the July 2013 issue.