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The Art of War in Adult Novelty Retailing, Part 1

The Art of War in Adult Novelty Retailing, Part 1

July 22, 2002
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" All novelty companies worth their batteries have a strategic direction whether it is stated explicitly or implicitly. "

Are you thinking of getting into the adult novelty game either with your own store or as an affiliate or mirror of someone else's? Before you do, you should have a firm grasp of the organizational levels of a business and its related marketing strategies and their components.

You should be able to define each of the key adult novelty retailing strategies and identify for yourself how these tactics affect your marketing decisions. As an adult retailer or potential affiliate, you definitely need to tackle how you intend to handle your own calculated marketing process and its three component parts: planning, implementation and control, before you enter the adult novelty market, in order to achieve the highest level of success.

Levels of Organizations
First let's distinguish among different kinds of organizations and the discreet levels within them. We are all familiar with the two main categories of organizations: for-profit and non-profit. As adult novelty merchants, we are generally in the for-profit camp meaning we serve our customers in order to be rewarded with profit, which is financial compensation for the business risk our organizations undertake when they offer a product for sale (in our case adult novelties).

For-profits are further divided into privately held organizations (those in which no outside stock ownership or fiscal interest is a part of the organization) and public business firms which sell a small percentage of ownership in that entity's equity in return for operating capital. My own company, Athena Media, Inc., is an example of a privately held corporation. Private.com is an example of a publicly traded corporation. In contrast some of the largest and most successful businesses are non-profits, such as The Rubber Tree which is a non-profit condom store.

All novelty companies worth their batteries have a strategic direction whether it is stated explicitly or implicitly. This strategic direction guides the company's marketing objectives, and they way in which those goals are implemented. Various levels in an organization effect the manner in which this vision is shaped and upheld. As an adult vendor you need to be very clear on how marketing decisions are guided throughout your organization or you will not be as effective in your strategic decision-making as you could be. You need to know in relatively concrete terms how you are going to grow your organization today, tomorrow and next year. If your adult interests don't have this kind of game plan, in general you will tend to waste precious time energy and resources in a haphazard manner which will not further your for-profit goals.

In the corporate or "executive" level, the top managers direct the management and marketing strategy they use for their adult novelty business. This is where the vision for the business is formed, defined, and then disseminated to other levels within the organization. The "message" should be clear, concise and very easy for the other members of your organization, or for outside alliances and partnerships to act on. The best strategies are often the most simple, and tend to be broad at this level. The more complex your strategy, the more likely it is that you will have a tactical communication gap in your adult business, creating a cognitive dissonance between what the executive level has set as their desired goals and what other levels of the organization perceive as goals.

The "business unit level" is the level at which business managers set precise, measurable goals and concrete direction for individual markets. This would be your LA guy working on getting the word out about your products on the West Coast or your affiliate in Hong Kong attempting to penetrate the Asian market. The term "business unit" refers to an organization marketing very specific products to a specific and well-defined market segment. The executive vision is refined to include specific plans of action here, such as a specific print advertising campaign. In less complex organizations, the proverbial one-man or one-woman show, the executive and the business level merge into one.

The "functional level" of your organization is the level at which specialists create value for the organization. Value is defined as any asset which represents future worth to your adult business - this could be the work product of a hot designer, adult novelty stock, a slogan for next month 's campaign, or merely your own implicit plan for success. The functional level includes specialists in their field of expertise: accountants, designers, bankers, warehouse staff, marketing staff, human resources and novelty manufacturing. Various departments control how your executive vision and your management direction are actually implemented in reference to your adult store. Think about how Playboy operates over its various channels: whether print, online, cable or video, there is always a consistent Playboy image.

Marketing has a very specific function at each level of your organization, even if your adult business is small. In larger organizations with multiple business units (i.e.: pay sites, adult retail store and affiliate program), the marketing department will be engaged to create a unified corporate image. Think about how Playboy operates over its various channels: whether print, online, cable or video, there is always a consistently unified Playboy image. Your business, no matter how small or how large, should apply this same level of focus to cohesive marketing.

Remember, just as organizations have a 'hierarchy of levels,' there is also a hierarchy for marketing tracks. In medium sized adult stores that have discreet executive, business and functional levels, there will likely be separate marketing strategies, yet each will guide your plan of action. One of the things frequently observed in the adult industry for those novelty stores that are smaller with a flattened hierarchical matrix, is a high-level of cross-functional teams, meaning everyone wears several hats to get the job done. Working together with one another, these small, efficient work teams are able to create enormous value for the organization.

To recap, the executive level of an organization defines the broad vision of their marketing goals. The business level then creates a specific plan of action based on local market conditions and specific segmentation while the functional level actually puts that plan of action into effect through their specialized areas of expertise.

In Part 2 we'll look at Organizational Success and Developing a Corporate Vision - Stay tuned!


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