Sea Ray signs new deal with Costco

Posted on March 01, 2010

Sea Ray Boats is expanding its strategic alliance with the Costco Auto Program in key metropolitan areas throughout the U.S.

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This agreement gives Costco members in certain areas special pricing on select Sea Ray Sport Boat and Sport Cruiser models, plus up to $3,000 in rebates.

"We are very pleased with the program results thus far, especially taking into account that nearly 70 percent of the buyers are new entrants into the sport," said Mike Burke, vice president of sales and marketing for Sea Ray, in a statement. "These incremental sales are a result of Sea Ray's award-winning dealer network. Their hard work and intense customer focus continue to satisfy the most discerning customers."

The expanded program will be offered throughout the U.S. (except Alaska) and Puerto Rico.

"This alliance between Sea Ray and the Costco Auto Program differs from those that some other boat brands have with other retailers. Specifically, in this arrangement, the dealer is an integral part of the process, not a service-only afterthought, so buyers get the full sales and service treatment of Sea Ray's industry-leading dealer network," said Burke.

Click here for the full release.

Comments

Some of you old farts are really showing your age and inability/unwillingness to adapt to the times. Brunswick aligns itself with a huge, affluent demographic, (these are not your K-Mart/WalMart shoppers) to create valuable leads for you and all you can do bellyache. They're brilliant and you guys need to retire!!

I hope there is some incentive coming from Sea Ray for the salespeople involved. In most markets we are paid a percentage of the gross sale, the discounted Costco pricing slashes our commisions in half, meaning we absorb a good chunk of the discount, not the dealer.

Costco, while having discounted prices are not a low end store by any means, unless you call Tag Hauer, Cartier, Vizio, and Tommy Hilfiger "discount brands". Costco is known by savvy buyers are the place to find (key word here as they change up their inventory quickly) high end products at less than high end prices. Is SeaRay a high end product? No. It's a mid range boat that should fit in perfect for a company such as Costco that has stores all across the country. It's a win-win for all parties, except for maybe "Bubba's boats and outboards " in Ocala Fl.,(or other similar inland area's) where "service" comes with a toothless attitude. Nothing like having the huge power of Costco behind you as a consumer to get things done for you-the consumer.. btw- Costco has banking plans that pay the highest money market rates in the country. Stop in- you might just be surprised the price you can buy diamonds and pearls for your sweetie, whilst buying a deep cycle batterie for yourself.

There goes the re-sale value and the perception of Sea Ray as an luxury brand...

I am so happy that Brunswick,through their beloved Sea Ray boat line is getting nearer and nearer to controlling the amount of money a dealer can or cannot make. It is time for Brunswick to sell all of their products in their own stores with their own technicians. Do not kid yourself 22% was the magic figure in the boat business in 1976 what makes you idiots applaude Brunswick, they are only interested in themselves.. I never made as much or had less problems with product or factories as when we switched to the YAMAHA BRANDS and serviced what we sell not some discounted product .

I am worried about the perception that Sea Ray will be looked upon as a Discount Brand and if it establishes itself as that (Seville) it will take sometime to re-establish its good name. What kind of bone will be thrown to Sea Ray dealers with such a low margin? Are dealers hoping for warranty/repair $$$ only?

Being a loyal Costco member, I think it is a great idea for both the merchant and the Coscto. Some may see Costco as a discount retailer, but they have great quality items, at pricing that no more than 17% above wholesale. Before we make any major purchase, we look to see if Costco has the item or a program that provides the item, knowing that we can spend less thru Costco.

We currently own a boat, but if we ever look to replace, we'll definitely shop it thru Costco. We do the same when shopping for cars - we look at their auto program, which then refers us to the dealer who is cooperating with the program. It's a great option for the consumer.

Jane Warren, Publisher, www.towabletubesdirect.com

Here are some facts about the Sea Ray-Costco program to help some of the gloomers-and-doomers out there better understand how powerful this alliance will be. Costco is ranked #1 in CSI among it's competitors. They have nearly 40 million loyal members with education and income demographics that exceed that of the current Sea Ray owner profile. Costco has 400 stores across the nation with an average of 100,000 members per store. Most Sea Ray dealers have more than one store in the sales territories. This is not a "knee-jerk" program. Sea Ray has been affiliated with Costco for many years in a lesser capacity. In a west coast pilot program last year in only three states, 2,000 leads generated 140 boat sales; 66% were "new to boating" and 90% were "new to the Sea Ray brand". Although I am certain that Brunswick blessed this program, this is a Sea Ray initiative, thanks to Mike Burke, VP of Sales & Marketing. As a proud Sea Ray dealer, I cannot wait to put boats in their stores, host parking lot sales and be included in their 40 million-count marketing machine.

Boat-1

This is a very smart idea. Moving boats into the market place should be a higher priority than worrying if it is a discount product. The object of sales is to move more boats and get new customers. If only sailboat manufacturers would do the same thing!

What really ticks me off is that Brunswick/SeaRay is not including McDonalds, TrueValue Hardware, Amoco gas stations and Bubba's Sand & Gravel Supply in the agreement. Costco is a discount merchant, so that tells me, the consumer, that SeaRay is a "discount" boat. I am just amazed at what marketing folks come up with. I'm so glad I am out of the boating industry.

Brunswick has screwed up every other line they acquired, why not Sea-Ray. This company needs to focus on their motors and leave the boat building to someone that knows what they are doing!fRJa

I can completely understand Brunswick's motives here. Bottom line is staying alive and keeping the factories going, people working etc. OK in the short term, but we all know that in the long term having a lack of continuity in the boat buying/ownership process can expose many potential pitfalls. These problems are what the marine industry has been trying to correct ever since I've been reading industy publications. Some 30 years now. Unfortunately when things go poorly for a boat owner because of owner-dealer-product relations it's not just a black mark on the brand, the entire industry takes the hit.

Rocky Flint

Rocky's Marine, Inc.

I sold Sea Rays at Costco for a couple of years in California. It was great! I have sold one customer a 175 Sport, following year a 200 Select now a 240 Sundeck. It's nothing new and works great! Lot's of leads!

As a Costco member this concept worked out well for the car I bought using the Costco Auto Program. Why should a boat be any different?

This is anything but desperate, Genmar used a similar approach in their aluminum brands and did very well and NO they did not sell factory direct, their dealers were very much out front. The dealers that put the effort in to do it the right way did great, those that gave it a half assed effort got that kind of ROI.

I know Mike Burke and in fact owrked with his wife at Brunswick he is a class act and always the consumate professional. The customer always comes first, and in this case he's giving his dealers a new lead generation tool. What the heck is wrong with that?

Stop and think, when was the last time you had a good idea for your business?

Most Brunswick brands pay the dealers posted shop labor rate.

In the past, Costco simply received a small commission if one of their members bought a boat. The dealer is the one selling and servicing the boat.

Will... according to the release, the dealer still sells and services the boat. Costco just provides leads.

Sea Ray is probably the best demographic match for Costco members versus brands that have tried to do it before. Also, It's dealer network is probably the best fit to meet Costco's standards. We'll see what happens.......

This is nothing but corporate America pushing around the small dealer again. Give us a break! How much is Brunswick going to pay the dealer (per hour) to fix warranty issues? How much are they paying the dealers for each boat sold?

Will, Premier Marine, Inc. Orlando 33 years in the Marine Business

At least Brunswick is involving the dealer network in the process, instead of selling factory direct. Costco's membership base is simply too large to ignore. If the dealer handles it the right way, any subsequent transaction will come to the dealer first.

Speak for yourself, George. Properly implemented it can create badly needed leads. You call it desperation. I call it another bullet in the gun.

How many times has this been done and failed miserably? It not only irritates the dealer base but shows the desperation of Brunswick in these depression times

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