Peddling premium paddling
I started my career selling soap on the West side of Milwaukee. Back then, the most popular promotions by far were what we called “dealer loaders.” These offered the retailer some kind of gift or premium for placing a larger-than-normal order. We figured that dealers couldn’t order from our competitors when they had a backroom full of our products. We fought “the battle of the shelf” and “the battle of the backroom.”
One of the best examples of loader premiums was executed by Old Town Canoe. The company was launched in Old Town, ME, by George Gray, who owned the local hardware store. In the late 1890s, George and his son Sam hired a local Alfred Wickett to build canoes in a shed behind the store. By 1900, they incorporated the business into the Indian Old Town Canoe Co., and moved the operation to a building owned by George’s brother, Herbert Gray.
The Grays’ timing couldn’t have been better, as America was in the grip of a national canoe craze. Canoes were the first major purchase of many young men of that era. Automobiles sold for $850 and cost more than a year’s salary for the average working man. A good canoe, on the other hand, cost just $30, a bargain when all you really wanted was an innocent excuse to be alone with a young woman. (It was said that canoes were so thick on Boston’s Charles River that you could walk across without getting your feet wet.) By 1920, Boston’s Park district estimated that there were over 6,000 canoes in the city’s lake district alone. A fraternity song from that era summarizes the mood: “Step in our boat and we’ll all take a float for we’re all out to have a good time.”
The primary downside to the canoe is its seasonality. Open canoes are ideal fair-weather craft, but they are downright miserable during bad weather. Consumers could order directly from the factory, but then wait half the summer. The Grays wanted dealers, who were primarily small stores, to order enough canoes during the fall and winter, to meet demand for the coming year’s warm season.
Around 1915, Sam Gray began giving a premium to dealers who ordered a full rail car of 40 canoes. “Carload” orders were rewarded with a four-foot duplicate of the full-size boats. Customers ordering two railcars could receive two four-foot models or one eight-foot model.
Benson Gray, the great grandson of founder George Gray, estimates that although Old Town only gave out 20 to 50 “samples” in any given year, they had a huge influence on sales, then at 4,000 canoes per annum. A carload of 40 canoes multiplied by 50 models equals 2,000 sold canoes — half of the company’s total production in some years — due to this unique dealer loader.
The canoe models were miniature works of art in wood and canvas, made by the same craftsman who built the full size canoes. Old Town’s workers earned extra money by making them at home in their spare time. A model took almost as much time to make as a full size canoe. “A four-foot model takes about 80 hours to construct,” says Jerry Stelmok of Island Falls Canoes, who makes replicas today under license from the company. “That’s 80% of the time it takes to make a full-size canoe.” (Stelmok sells his models for up to $2,500; a comparable full-size wood and canvas canoe runs around $3,000.)
Although the models were extremely popular for in-store display, the biggest challenge was storing the inventory. Old Town had some large customers back then, including Macy’s in New York City, and Marshall Field in Chicago. But most dealers were small stores that had barely the room to display one canoe, let alone 40. But they were ingenious at finding ways to take advantage of Old Town’s offer. “They either rented separate warehouse space, or more commonly, hired someone to guard the shipment twenty-four hours a day until they sold them,” Benson Gray says.
Old Town used their dealer loader strategy until around 1940. During World War II, the Old Town factory was used to supply oars, paddles and other nautical materiel to the Navy for the war effort. By then, the greatest threat to Old Town and its canoes came not from the water, but from the air.
Grumman Corp. had made its name producing warplanes with a new material called aluminum. After the war, it needed new products for a peacetime economy, and someone had the idea of making aluminum canoes. Grumman even contacted Sam Gray with an offer to let him market their new product for them. “My grandfather didn’t see any future in aluminum canoes and he turned Grumman down flat,” recalls Benson Gray. By the 1960s, Old Town was producing 200 of their wood and canvas canoes while Grumman’s sales were nearly 20,000 of the aluminum boats.
And yet…while aluminum canoes were enjoying the peak of their popularity, Old Town began experimenting with an even newer canoe material: fiberglass. It and other new materials spurred Old Town to what Susan Audette refers to in her book The Old Town Company as “the big comeback.”
Then, just as business began looking up, the company got a feeler from Johnson Diversified, a fourth-generation family-owned firm best known as the makers of Johnson Wax. The Gray family elected to sell to the Johnson family in 1974.
Johnson runs its outdoor recreational products division with the same attention to detail as the Gray family. It has even given out some fiberglass sample canoes over the years. Several times a year, Jerry Stelmok is called on to produce one of the old four-foot models for an important customer, or as a company retirement gift.
Today, Old Town and its affiliates again dominate the personal watercraft business. Though the line is dominated by polyethylene-based kayaks, you can still order a hand-built canvas model made the old-fashioned way from Old Town, and about 60 traditionalists a year do just that.
The old samples turn up occasionally at auctions of sporting antiques. These beautiful examples of bygone craftsmanship are fiercely pursued by collectors, and bid into the five-figure range. The current record for an Old Town model stands at just over $18,000, which, all things considered, is a pretty fair price for a giveaway item.
Rod Taylor is senior VP of promotions for CoActive Marketing and wishes to thank Benson Gray for his assistance in writing this article. Send your feedback to [email protected].
Prime Premiums
Custer’s Last Fight In 1896, Adolphus Busch, the father of Budweiser Beer, acquired a massive16′ × 9′ painting by artist Cassilly Adams depicting “Custer’s Last Stand.” Busch had lithographers reduce the painting in all its gory detail to a still impressive 49.5″ × 39″ print. Anheuser-Busch salesmen of the late 19th century used the print as an incentive to get new clients in the western states to stock their beer, shipped from “far away St. Louis.” The promotion was such a hit that it was re-run 19 times over the next eight decades. A-B estimates they printed over two million copies of the painting over its run.
Sam the Eagle Pin Set Coca-Cola was the official soft drink of the 1984 Los Angeles Olympic Games, which had a mascot named “Sam the Eagle.” Pin trading was then a new hobby, so Coke got the idea of issuing a framed pin set featuring Sam carrying the flag of each of the 150 participating countries. I saw a retailer order 2,000 cases of Coke cans at $6.00 a case to get two of these pin sets. Since the sets cost Coke bottlers $155, his purchase represented a mere 1.3% of the cost of goods, or $0.0775 cents a case — significantly less discount than Coke normally offered on a 2,000 case order.
Trainload of Savings This October 1990 Procter & Gamble promotion offered retailers a complete “0” gauge model train set for buying and displaying at least 180 cases of four of the six sponsoring P&G brands. Each of the six cars in the set featured the logos of one of the participating brands: Folgers coffee, Sunny Delight, Jif peanut butter, Duncan Hines cake mix, Crisco shortening, and Puritan Oil. To top it off, P&G and supplier K-Line Trains printed each store’s logo and colors on the locomotive in the set! Over 15,000 stores participated in this event, purchasing an average 220 cases a store — 12% more than P&G had planned. In fact, the train set was so popular, another 6,000 train sets were sold to P&G employees at $130 each over a 45-day period before Christmas that year.
