Spring 2011 The Sweet Cell of Success

Cellairis recognizes that image is everything. Its broad range of cell phone accessories makes customers’ cell phones an extension of their personalities. With ringing endorsements from franchisees and customers everywhere, find out why this young, vibrant company is poised to dominate the thriving cell phone accessories market.

Offering over 100,000 SKUs, Cellairis Franchise Inc., the franchisor based in Alpharetta, GA (just outside Atlanta), stands out from the crowd; a shining beacon in the common area—with accessories in every color and pattern imaginable. Hundreds of locations nationwide deliver these crowd-pleasing styles making it no surprise Cellairis’ sales are growing faster than a teenager can text: “Wow!”

Plans are on board to open their 1000th store by the end of the year. This exponential growth did not happen overnight. Growth was steady and calculated, as the founders of the company learned from experience and translated those lessons into better ways of doing things—from improved training programs to state-of-the-art kiosks.

It was in 2000, when three friends, Taki Skouras, Jaime Brown and Joseph Brown (twins) united by an entrepreneurial spirit decided to jump into the cell phone accessory business and formed a company that evolved into Cellairis. Shortly after graduating college, they moved from Melbourne, FL to Atlanta, GA and set up shop at the Perimeter Mall.

A month after that, a new location at the Cumberland Mall followed. For the next three years, the business continued to blossom and by 2003, the 100th location was opened.

It was also in 2003 that the three friends entered the world of manufacturing, having small quantities of products made overseas. “Now we manufacture about 70% of what we sell,” says Taki Skouras, CEO. Today, Cellairis and its affiliate, design the majority of their products in-house and manufacture them in approximately 25 different factories in China. Manufacturing enables Cellairis to offer their franchisees new and unique items that can’t be found anywhere else, says Skouras.

Meteoric growth

By 2005, Cellairis was growing at a rate that demanded change. To scale to a national level quickly they decided to franchise the business. The company made its first national deal with General Growth Properties for franchises at approximately 100 locations. Cellairis’ franchisees now dot many other real estate companies, as well, such as Simon Property Group, Westfield, Taubman, CBL Properties, Ivanhoe Cambridge, Macerich, Glimcher and PREIT. “At that point, it was more efficient and effective to go to a national rep because we had so many people wanting to open a Cellairis franchise,” says Skouras.

Today, the company still has some corporate-affiliated locations, which are used as training bases and launch pads for new trial products and systems. “We try to work out the kinks before implementing these new programs within the franchise system,” says Michael Duarte, Vice President. He adds that these corporate-affiliated locations are not all owned by the company but by company partners.

In 2009, Cellairis was ranked number nine in Franchise Times’ “Fast 55” (a list of the top 55 fastest growing, young franchise companies), with a 911% growth rate over a 2-3 year period, says Skouras. Cellairis was also recognized by American Express, chosen for their Business Plum Card national television campaign last October. “We are proud of this because we know the standards American Express holds,” says Joe Ciardullo, Chief Marketing Officer.

The cell phone accessory business continues to thrive and shows no signs of slowing down. “We’re seeing some very impressive numbers. The last couple of years we’ve had big ups, even with the economy being the way it is,” says Skouras. “There are more cell phone users now than there have ever been—and the number keeps growing,” he says.

With a demographic base starting at 12- 13 year-olds (usually with media players) and going well past 50, it’s easy to see why mobile accessories are so popular. “Our data shows people spend about $60 on accessories for the life span of their device,” says Ciardullo.

Express yourself

Cellairis sells high-quality, fashionably fun accessories for mobile devices. Yes, there are the core product categories such as car chargers, leather pouches that attach to belts, and headsets, but it’s the shields or cell phone covers, that allow the customer to express his or her personality.

Colors are vibrant, designs are snappy. From refined leather to sports logos, Cellairis offers a gamut of fun and exciting patterns. Cell phone users can shout out their love with hot pink rhinestones or keep it low-key and environmentally conscious with sustainable materials such as cork. Fashion trends are followed every day to keep abreast of the latest colors and patterns.

“The more popular protective shield designs are animal prints, such as zebra, giraffe and leopard,” says Joseph Brown, President. Popular sports products include licensed football pouches featuring the Green Bay Packers and the University of Florida Gators. And fashion isn’t the only piece in the puzzle. “Phones are getting more high-end and consumers want to protect them,” Brown says.

While there may be other cell phone accessory players in the market, “We have the largest selection by far and our quality is unsurpassed as well,” says Brown. For example, Cellairis uses the finest leather materials available, as well as, “high-end paint in true Pantone colors with UV coating so it doesn’t scratch or fade,” he says.

Brown adds, “Our screen protectors use a triple layer film, so the LCD doesn’t scratch. They are also anti-glare and anti-fingerprint.” For those watching movies on their iPad or iPhone, there are HD crystal clear screen protectors that promise no distortion for the viewer. And for those sending discreet emails or texts, there are privacy screen protectors to block out angled viewing, he adds.

For the ultimate in glamor, Swarovski crystals can decorate cases as well. The popularity of this line is steadily increasing, Brown reports.

Product selection at every Cellairis kiosk varies based on retailer location, and the networks and phones offered for their territory. With new phones coming out every day, and new shields being manufactured to cover them, products constantly evolve. “We make sure we have accessories for every phone on the market,” says Brown.

In addition to cell phones, Cellairis offers shields that personalize and protect consumers’ gaming consoles, media players, eReaders, netbooks and laptops.

But the true golden ticket in the specialty retail world is this: Cellairis offers a year-round product at a magic price point—a fashion-fix, impulse price point, says Skouras, averaging $20.

Franchise options

Interested retailers begin their journey with an application process. This is followed by securing a location and choosing a merchandising unit. There are a number of merchandising options: a state-of-the-art Cellairis kiosk, Cellairis RMU or custom-built displays for the interiors of existing shopping center RMUs. Kiosk and RMU designs vary depending upon the shopping center and the franchisees’ goals. “Each mall requires specific design requirements, which Cellairis identifies and implements,” says Jaime Brown, COO.

Cellairis assists retailers in choosing the right merchandising mix for their unit. “Because we have a substantial footprint, we know what phones sell in what markets. We can tailor to that,” says Duarte.

After legal agreements are put to bed, and a location is finalized, it’s time for training. “We have a Cellairis University where new owners can train before going into the actual retail environment,” says Duarte. He adds that Cellairis has local and national locations with corporate personnel and franchise owners who assist in training in an actual retail environment. “We like to see at least two weeks worth of hours logged in at a retail location before beginning a new store set up, but new owners are welcome to train as long as they would like,” Duarte says.

Cellairis representatives also help franchisees merchandise their locations.

Support is never more than a phone call or visit away. “Each franchisee is assigned a specific customer service representative who assists in opening the unit,” says Duarte. In a recently launched program called “Feet on the Street,” Cellairis representatives physically visit locations to check merchandising standards. “Our ‘Feet on the Street’ program ensures all locations have corporate support on location at least once a month at this time. We are working to get this to a weekly event,” says Duarte.

Franchisees will also find support through Cellairis’ extensive network of distribution centers. In an effort to have products at Cellairis franchise locations as quickly as possible, there are eleven distribution centers strategically placed across the country for fast, efficient product distribution.

The franchise fee is a one-time fee charged for the location, and includes training, set up and any other new store items put in place for the opening, says Duarte. A royalty is a monthly fee charged for supporting, growing and improving the business. Fees were not disclosed based on corporate policy.

And lastly, stores within shopping centers offer support as well. Cellairis has established good working relations with permanent stores such as Apple and AT&T who refer customers to their kiosks in the mall.

Cellairis has developed a franchise system that reflects its experience and dedication to provide cutting edge products, powerful marketing, and sophisticated support.  “Our desire to see our franchisees succeed coupled with our unique understanding of the customers we serve makes us an industry leader in wireless device accessories,” says Skouras.

Branding a niche

Until recently, growth has taken place more or less on a grassroots level. But that is about to change. “We are creating a brand,” says Ciardullo. Creating, building and driving it, until Cellairis becomes a destination, and “customers come to the mall specifically for Cellairis, and have the same experience they would have at a store like Gap or JCrew,” he says.

When it comes to branding, Cellairis is big on social media. “We view social media as an extraordinary means to reach our customers. Our goal is to show our personality, make it fun,” says Ciardullo. And this is evident on Cellairis’ Facebook page, in which visitors are immediately hit with color; a shield walkway in vibrant oranges, blues, plaids and animal prints, to name a few. By clicking on the “buzz” link, visitors receive the latest scoop from US Magazine, TMZ and Radar Online. Or maybe fans get a message on their wall asking who they think will win the Super Bowl or Academy Awards. “We want to engage with our customers, not always sell to them. We want customers to come back because they like the conversations we have,” says Ciardullo.

Contests have been part of the fun, such as during the fourth quarter of 2010, when Cellairis gave away $500 each week to a lucky winner that visited their Facebook page and registered for the contest. This generated a great deal of social media traffic. As of January this year, the number of friends on the Cellairis Facebook page numbered 3,370. Other social media avenues Cellairis uses include Twitter, YouTube, and LivingSocial.

Community presence

Cellairis is one of three major sponsors for “The Great Hang Up,” an event started by the local NBC affiliate in Atlanta, last October. The promotion encourages people to sign a pledge saying they won’t text and drive. “We certainly want people to be safe. Being tied to this movement made sense,” says Ciardullo. For those who signed the pledge, Cellairis offered a product discount.

Another example of community-wide marketing is when a particular mall was participating in Breast Cancer Awareness month, Cellairis changed the kiosk lights to pink and offered a discount on pink cases. Also, in January, Ciardullo handed a company check in support of the National Center for Missing & Exploited Children. “We’re trying to be socially aware and responsible to the communities that support us,” he says.

And the same can be said in reverse. Because they pay back, because they reinvest, because they recognize every player on the playing field, they are successful, and will continue to be so. Cellairis constantly evolves, constantly asks what can be done better. Company officers never assume they have all the answers in their own hands.

“Expect more” is part of their mission statement. And something they expect every day of themselves.