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How to survival in the digital age Local businesses on the effects of digital disruption

BY TIM GANNON

How do local brick-and-mortar businesses compete in the age of Google and Amazon and when consumers are one click away from purchasing nearly anything?

Offering a unique product is one way, a panel of local business owners mentioned frequently during a Times Review Talks discussion at The Vineyards at Aquebogue last Wednesday.

Good old-fashioned customer service was another frequent suggestion.

The discussion centered on “Keeping It Local in the Digital Age.”

The panel of speakers featured Rena Wilhelm, owner of The Weathered Barn in Greenport; Stephan Mazzella, co-owner of Mint, a clothing boutique in Mattituck; Beth Hanlon of Allstate insurance in Riverhead and Wading River; Paul Romanelli, owner of Suffolk Security Systems in Southold; Nancy Messer, a vice president of BNB Bank in Bridgehampton; and Yvonne Lieblein, a marketing specialist and general manager at Port of Egypt marina in Southold.

Rena Wilhelm of The Weathered Barn in Greenport and Stephan Mazzella of Mint Clothing Boutique in Mattituck. (Credit: Erika Peters)

Unique products

Ms. Wilhelm said The Weathered Barn Lifestyle Boutique on Front Street in Greenport “absolutely” has an advantage over digital competitors.

The Weathered Barn is home to some 10+ craftspeople whose work is carefully curated to fit within the shop’s lifestyle brand, according to its website.

“One of the things that allows us to be successful as a small business is that people can come to our store and find something there that they’re not going to find anywhere else,” Ms. Wilhelm said.

She and her husband, Jason, operate the store.

“For instance, we have handmade ceramics that are created by a friend of mine, and while you can go out and find ceramics somewhere else, ours are specifically unique to us,” she said. “Our artists are also unique to us. They don’t feature their work anywhere else. That allows us to curate a specific look for the store.”

The Weathered Barn does sell products online, but Ms. Wilhelm said that most of the online purchases are from people who have already been to the their store and know what to expect.

“The second something becomes overblown or is found in someone else’s shop, I pull out,” she said. “Even if it’s something we make personally.”

Mint in Mattituck. (Credit: Tara Smith)

Building online presence

Mint clothing boutique on Love Lane in Mattituck is an example of a local business that’s using the internet to its advantage.

“When you hear the realities of brick-and-mortar and online and merging the two, 90% of the people walk away and say, ‘no way. I’m not doing that,’ ” said Mr. Mazzella, co-owner of Mint, which has several locations on Long Island.

“But you don’t have a choice,” he said. “We built Mint 16 years ago on Love Lane, and since then, I’ve built nine of them without e-commerce. But e-commerce has been a part of Mint for four years now, and it just became profitable.”

On the web, there could be someone in Arizona who sees the website, but there’s a “whole process to that,” Mr. Mazzella said.

It’s not just a matter of starting a website and hoping people will find it. Search engine optimization, or SEO, is key, he said.

“You have to pay people for that,” he said. “They teach you how to get your site in front of that sorority group in Arizona when they click online looking for a little red dress. There are certain ways to do that.”

He recommended working with a company that deals specifically with building websites rather than relying on a friend of a friend who lacks experience. There are companies like Shopify and Big Commerce that help build websites, he said.

“But you are going to pay through the nose for them,” Mr. Mazzella said.

These companies have classes that teach how to use Google Adwords to drive website traffic.

“There is no way you are going to find out how to do this other than taking classes, and paying huge companies to show you how to do this, and hiring these young guns out of college who are 22 or 23 years old with big salaries. But they are worth it.”

Now, he said, instead of just having a store on Love Lane, his company has a global reach.

“But I would say that in the first four years, you probably lose money on your websites,” he said. A business could also try to become a partner with Amazon, but they get 20% of what you sell, Mr. Mazzella said.

“You have to work that into the math to see if you can afford to do that,” he said. Staying away from Amazon could also be a bad thing, he said.

“It’s kind of like paying your dues to the industry,” he said. “The best part about it is that when it does turn the corner, all of a sudden I’m selling clothes to women on the West Coast.”

Beth Hanlon

Community presence

Allstate insurance agent Beth Hanlon says it’s tough to compete with companies like Geico and Progressive.

“They spend a tremendous amount of money on advertising,” she said. “I get tons of mail from Geico and Progressive. It’s an 800 number and that’s the bottom line.”

Ms. Hanlon said it’s important to make sure your assets are protected by your insurance.

“Do you want to spend 15 minutes with somebody that may have just gotten their license and has no background in protecting your risks and managing you risks?”

She added that you may never talk to that same person on the phone again.

She said one accident could wipe you out if you don’t have the proper amount of insurance.

“You save a few dollars, but then you find out you don’t have coverage when you drive out of state, or the car you just hit was a brand-new Mercedes, and now you don’t have enough liability and you’re going to be paying for it,” she said.

Ms. Hanlon said she’s always been community-oriented, and is a member of organizations like the Riverhead Rotary Club and the East End Women’s Network.

“That’s the stuff I like to do,” she said. “You have to be out there, especially for a small company trying to break through the digital disruption. You have to be present.”

Ms. Hanlon says her employees have extensive experience, with the newest one having 12 years’ experience and the longest-tenured one having 45 years.

“We promote ourselves as being trusted advisers,” she said.

Paul Romanelli

Technology

“This is my 20th year owning Suffolk Security,” said Paul Romanelli.

When he started, he was working with “some seriously older technology.”

But today, he said, that’s not the case, as everything is IP-based or cellular-based.

“I haven’t hooked an alarm system to a phone line since 2006. So the technology has changed quite a bit and there is a significant amount of disruption in our business now.”

There are companies like SimpliSafe, which sells self-installed alarms, and you can find such alarms in places like Costco and Best Buy, too, Mr. Romanelli said.

The reality is, the do-it-yourself market came about primarily because about 25% of homes have alarm systems, so everybody asked, ‘How do we get to the other 75%?”

A big portion of that is people who will never buy an alarm, or maybe they want to buy online, or, they don’t trust somebody coming into their home, he said.

There’s a lot of new technology, he said, and he even brought an example, an alarm sensor from Honeywell that can be self-installed and is also portable, so someone who lived in an apartment, for example, can take it with them. The device also can work through Amazon’s Alexa app, he said.

“It’s all app-based, so if you have your phone with you, you don’t need a keypad anymore. It’s the reality of what we’re seeing today. But we still do a significant amount of standard, conventional alarm systems, and there’s a good chunk of costumers that trust and want an adviser to come in and make suggestions for them.”

He said his office “is in constant training mode” as there are always new technologies. Mr. Romanelli said his company was even chosen for beta testing of a new alarm system for Honeywell, one of only about a half-dozen companies in the country that helped beta test Honeywell products before they were released.

Nancy Messer of BNB Bank, formerly known as Bridgehampton National Bank, said larger banks have been ahead of the game in technology.

“But we have to face this challenge…you want a banker you can speak to,” she said. “What we’ve done is we’ve partnered with technology companies that can offer us a better way to serve small businesses to get their loans through quickly.

This year the bank will operate a portal where customers can apply online and submit all the documentation for a quick process for small businesses.

“The small businesses out here cannot wait for the bank to move at a glacial pace,” she said.

Ms. Messer said that with larger customers, “I think it really is important to have somebody local, who you can come and speak to. I think it’s important for smaller businesses too, but to be able to do it more quickly, and spend their time not sitting with me, but going online and getting that stuff quickly.”

Ms. Messer said it’s a misconception to think that BNB and other smaller banks don’t have the products to compete with large banks like Chase and Bank of America.

“But we do, and we’ve been able to provide everybody with treasury management products and online banking and paying their bills online,” she said. “We have mobile banking apps. So I think that helps all of the small businesses out here, especially in season, when they really need money, and they need access to that money, and they don’t have time to come running in here to see us. That’s what we’ve been working on at the bank, and I think we’ve done a really good job.”

Yvonne Lieblein of Port of Egypt in Southold was one of the panelists. (Credit: Randee Daddona)

Working together

Yvonne Lieblein, a Greenport native, is a marketing specialist and, as of recently, the general manager of her family’s business, Port of Egypt marina.

She started working in Bruce’s Cheese Emporium when she was 14, she said.

She recalled the competition that began to form in the 1990s with the emergence of Tanger Outlets in Riverhead.

“It wasn’t the internet yet, but it was competition,” she said. “I think that’s the essence of what the local experience was then — and is now — is that sense of connection you have with your customer,” she said.

It’s important to be authentic, she said.

“We just have access to so much more information now on how other businesses do it, which is great. I can give us ideas,” she said. “Working in a small business is difficult and stressful and challenging, but it’s also awesome.”

One thing Ms. Lieblein recommends for businesses is to work together with other businesses, which several Greenport stores already are doing.

She cited First and South, a bar and restaurant on South Street, and One Love Beach, a beach and outdoor lifestyle boutique.

One Love Beach wanted to encourage people to go paddle boarding, so they held paddle boarding events on Tuesday nights, and afterwards, the paddle boarders would go to First and South.

“Now, First and South benefits because they have a community coming on Tuesdays, and One Love Beach benefits because more people find out about paddle boarding,” Ms. Lieblein said.

Likewise, she said, Clarke’s Garden would sell bouquets at The Market on Front Street.

The Market also worked with Times Vintage, a clothing store, on its 30th anniversary celebration, benefiting both businesses, she said.

“It doesn’t have to be an event, just a cross promotion that benefits you,” Ms. Lieblein said.

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