Wrapping Up the Sales at I-Wrapz
Co-owners: Oscar Cano and Joe Montalvo
Headquarters: Newark, NJ
Locations: More than two dozen
Countries: In US, Canada, Puerto Rico
Growth strategy: Turnkey startup packages supported by corporate
Marketing strategy: Comprehensive branding program including TV spots
In less than a year, Oscar Cano and Joe Montalvo have transformed their idea for a better mousetrap-or in this case, a better iPod wrap-from a topic of conversation into a full line of gadget-protecting products sold from more than two dozen carts in three countries. Thanks to a lightning-fast manufacturing process that gets new designs on the streets in a week, i-wrapz can capitalize on social and retail trends as they’re happening, snapping up sales ahead of the competition. With a turnkey startup package for specialty retailers, Cano and Montalvo say i-wrapz is ready to be a multinational player in the specialty retail arena.
Headquartered in Newark, NJ, i-wrapz designs and manufactures covers for today’s must-have gadgets, from iPods, Blackberries and handheld electronics of all kinds to their larger laptop cousins. I-wrapz not only protect our most-cherished gadgets from harm but transform them into personal fashion statements in a few seconds. Available in more than 200 designs-from tricked-out racecars and sports images that have big guy-appeal to swirls of butterflies, flowers and hearts that strike a chord with gals-i-wrapz has a design for every taste, every demographic. But just a few years back, i-wrapz was just an idea being tossed around by two entrepreneurs.
From idea to i-wrapz
I-wrapz got started in 2003, unofficially that is, when Joe Montalvo was looking for a specialized printer for his company, Adcaps, a business that turns worthless hubcap space into valuable advertising space with special, non-rotating wheel covers (ensuring the ad stays right-side-up while the vehicle’s in motion or stopped).
Oscar Cano’s business, Color Screen Pros, designs and manufactures signs and banners including vehicle wraps for advertising and promotions. When Montalvo walked into Color Screen Pros that fateful day, he found his printer and a fellow entrepreneur with similar interests, significant advertising acumen and a lot of drive.
Naturally, as their business association and then friendship grew, their conversations sometimes turned to entrepreneurial business ideas. In mid-2003, Cano recalls, “We were talking about vehicle wraps and how you can remove them and not damage the paint.” That led to another thought: How could they create a similar product that would protect and enhance small electronics like iPods?
“We did our research and saw what companies were out there,” he says. “Then we thought about what we could do to create a better product. I remember thinking about a label process we used a while
back and we gave it a shot.” It worked. The first i-wrapz prototype, a mere four-to-six millimeters thick, was in their hands by September.
A prototype is a necessary first step, but the second step loomed: What was the best sales channel to pursue? Cano and Montalvo analyzed their options. Their top three choices were to debut their product online only, open a brick-and-mortar freestanding store, or launch in a mall that offered them a built-in stream of foot traffic. Checking into all three, they discovered the benefits of carts-from the low cost of startup compared to a traditional store, to the exceptional brand visibility that comes from being in the middle of shopper foot traffic. A cart, they decided, was the best way to reach throngs of cell phone- toting shoppers.
In November 2007, the first i-wrapz cart launched in Woodbridge Center in Woodbridge, NJ where the average household income is $93,579. The center has more than 200 specialty shops, services and restaurants plus six department-store anchors.
“There were times when the cart was completely overwhelmed with customers,” Montalvo says. Holiday sales neared $70,000.
Not only did shoppers respond well to i-wrapz, but the product also “got a huge response” from interested retailers who wanted to sell it on their own. Even some entrepreneurial customers wanted in on the action. The second i-wrapz location, which opened in March, 2008 in the 1.3-million-square-foot Jersey Gardens Outlets in Elizabeth, NJ, was the company’s first cart launched by an independent distributor. By October, i-wrapz had 22 cart locations, all owned and operated by independents. More opened in California, Canada and Puerto Rico in early 2009.
On the manufacturing end, i-wrapz continued to grow as well. Starting with roughly 80 designs for seven electronic devices, today the company carries 200 designs for more than 20 devices. Designs are created to appeal to different demographics, from cartoon-type designs for youngsters to more mature themes for everyone from teens to senior citizens. Patriotic or nationality-themed designs include the Statue of Liberty and the flags of more than 30 countries. A range of sophisticated looks appeal to audiophiles, professionals who need a business look, chocoholics, sports fans, wildlife lovers and more-much more. Plus, custom orders are an option. Customers provide the artwork and their one-of-a-kind i-wrapz arrives on their doorstep with 10 days. All signage and packaging is manufactured in Newark, too.
Of course, new designs are continually added to the mix. In the fourth quarter of 2008, the company released two collections, with 35 designs in each. And 2009 holds more exciting news: New i-wrapz for handheld games such as Nintendo DS and Sony PSP are scheduled for release on April 1st. Some designs are the brainchild of Cano and Montalvo, while others are inspired by customer feedback.
“We are in constant communication with all of our cart owners, who are getting ideas and feedback from their customers every day,” says Cano. “We periodically take a census of all cart owners to see what they are getting requests for.”
As the presidential election heated up last fall, shoppers began expressing an interest in a Barack Obama i-wrapz. Within days, the factory was shipping to retailers. “We had hundreds of requests for Obama, not including countless emails,” he says.
More than just good looks
Although the main attraction of i-wrapz are the attention-grabbing graphics and the ability to make iPods and iPhones personalized fashion statements in an instant, i-wrapz also perform another important function: protecting the electronics we rely on the most. Made from a 3M vinyl with a polyurethane resin coating, i-wrapz not only keep gadgets looking shiny and new but allow them to slide easily into a pants pocket, unlike other bulky protectors. At the same time, the surface enables smaller units to stick to smooth surfaces, such as glass and metal, so gadgets won’t slip and slide.
Another key to the product’s success lies in promotional pricing designed to encourage multiple buys. I-wrapz sell for $19.99 (laptop models are $49.99), but a customer’s second purchase is 50 percent off (at the discretion of the cart owner and not including laptop covers). Thus, it’s no surprise that multiple sales are the norm.
“It’s rare that we sell one item. There are so many ways to up sell,” says Cano. And plenty of room for markup for the retailer-close to 500 percent even including the 50-percent-off promotional pricing.
Joining the i-wrapz family
For retail entrepreneurs who want to jump on the i-wrapz bandwagon, Cano and Montalvo have made the process as easy as putting on an i-wrapz, with their comprehensive turnkey startup package ($9,999).
A typical cart stocks approximately 120 designs, although some have the space to display as many as 180 designs. I-wrapz asks retailers to stock a minimum of 100 designs to gauge customer tastes and interest in various styles.
“Within the first month, every cart owner realizes who his potential customer is and how to cater to them,” says Montalvo. For example, flag designs of various countries are very popular at the i-wrapz cart in New York’s South Street Seaport, which is visited by millions of tourists every year. To further tailor the mix to the particular retailer’s demographic for the best sales possible, “We allow retailers after the first 30 days to trade in 10 percent of their initial inventory.”
The partners also assist with location selection, thanks to their established relationships with a variety of real estate management companies. Once the retailer’s location and starting date are established, “We send a team out to do a full installation,” Montalvo says. “All the retailer needs are locks, a credit card machine and a fax machine. We put the inventory up. They open and start making sales.” Depending on location and traffic volume, retailers have the opportunity to pull in approximately $10,000 to $20,000 in sales on an average non-holiday month, he says, with an average of $100,000 during the winter holidays. Support also continues long after retailers are up and running.
“We send out emails and have a section on our website dedicated to cart owners. We are very proactive,” explains Cano. “One of the things our customers appreciate is that they can always pick up the phone and reach us. I built my [printing] business on customer service, building relationships and delivering a quality product. Joe did the same with his business. We brought that to the table when we started i-wrapz.”
Building a multinational brand
A strong focus for Cano and Montalvo is building brand recognition, and they leave no stone unturned in doing so, including their choice in top-notch product packaging.
I-wrapz come in transparent cases resembling compact disc covers for an upscale look that allows customers to see every detail of the design. Included with every product is the i-wrapz logo label, also made from 3M vinyl. Customers can place the label on their dashboard or virtually any surface, place their i-wrapz-wrapped i-Pod on top, and their iPod stays put, Montalvo explains.
The visual merchandising of the carts is equally important, with a goal of having nearly identical units no matter where they’re located. Salespeople wear i-wrapz black-and-white logo-imprinted shirts. Two demonstration monitors play i-wrapz videos that highlight the product’s functions and benefits. The overall look is “streamlined” and “very New York,” says Montalvo, as well as “modern and upscale,” adds Cano.
With a stylish and functional product, well-designed carts and a number of locations in close proximity to their headquarters, brand recognition has come easily on a local level, they say. This past January, when they were having lunch at a local restaurant, the waitress spotted their i-wrapz cell phones resting on the table and exclaimed, “Wow! You guys have i-wrapz on your phones, too!”
The goal now is to take it the company national, with a planned 150 or more locations from coast to coast by the end of 2009. More locations outside the US are in the works, too.
To help spread the word, i-wrapz plans to run television commercials on channels such as MTV and Comedy Central early in 2009.
Cano and Montalvo feel they’re in a great position to grow in the years ahead. The final piece, they say, is the independent retailers who want to grow with them.
“The cell phone industry is one of the largest industries there is,” says Montalvo. “We’re piggybacking on their sales. This is not something that will fade out.”
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