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Coral Bonanza

With the space mostly to themselves, high-end saltwater shops can maximize profits and build a strong, loyal customer base on a reef bedrock.


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The coral livestock business is thriving, according to aquatics specialty retailers across the U.S. Profits are stable, and the arrival of new aquarists in shops is balanced by long-time hobbyists seeking high-end corals to add to their collections.

“My average customers are just walk-in customers,” said Matthew Schmidt, manager of Reef Plus in North Aurora, Ill. “They don’t really know anything about saltwater, and that’s kind of why we’re here to educate them. But I do have a lot of customers who have been in it for a long time, and they’re very experienced customers for sure.”

As such, retailers are carrying all types of corals, from easier-to-care-for soft corals and small polyp stony (SPS) corals to large polyp stony (LPS) corals as well as many other rare and exotic varieties.

“Zoanthid corals are doing really well, and bounce mushrooms are doing really good,” Schmidt said. “A lot of the basics are doing well. A lot of different types of the soft corals are coming back again. Certain types of LPS corals are coming back.”

Availability plays into what’s popular, but having a wide selection is what is serving reef retailers best right now. Corals from Australian waters have been easier to find and are increasing in popularity as well.

“Our wholesalers have a pretty good supply of Australian corals right now,” said Jose Garcia, owner of Living Reef Aquariums in Oakland Park, Fla. “The Indo-Pacific corals are the best. They’re more affordable and more available. There was a big demand there for a while, and they couldn’t really bring in enough, but now it seems to be a lot better.”

High-end species also sell, though, as with any high-dollar item, it might take awhile, depending on local demand.

“Something that was available before but that’s appearing more frequently is the rainbow welsoni corals that have absolutely amazing color spectrums,” said Ashley Hoglund, manager of New Wave Aquaria in Minneapolis. “Everything’s actually doing really, really well right now. We have a lot of higher-end clients who really want only designer pieces. So we’re selling those and turn them around quickly, and then we’re able to get them in more frequently.”

Merchandising

Healthy Displays Are Good Business

When customers come in-store, they want to see beautiful corals displayed prominently in healthy systems.

“Having a healthy tank with a big, beautiful reef system full of all these colors and different environments really attracts people,” said Manny Corrales, manager of M&F Reefs in Brodheadsville, Pa., adding that the shop performs water changes weekly and constantly monitors conditions.

Healthy corals help drive sales, but strong husbandry practices also help preserve livestock—and pet specialty retailers’ bottom lines.

“Health is the No. 1 factor with corals,” said Jose Garcia, owner of Living Reef Aquariums in Oakland Park, Fla. “That’s why we don’t like to frag corals, because they look like they’re hurting. They’re not going to open to their full potential. If I chop it up and put 50 little fragments in a tank, it doesn’t sell quite that well.”

Some retailers prefer to link their systems for centralized maintenance, while others set up independent systems to prevent the spread of problems that might arise.

“All our tanks, all of our store, are made up of well-established reef tanks,” Garcia noted. “I don’t have any shelves full of corals. I think every store has that. They display all their corals on shelves or in shallow tanks.”

Other retailers reported merchandising livestock in fully stocked display aquariums as well.

“All of my fish systems are on big, interconnected systems,” said Matthew Schmidt, manager of Reef Plus in North Aurora, Ill. “Otherwise, each and every reef tank is all on its own.”

Mixing frag tanks with egg-crate racks and more elaborate display reef setups is a common tactic retailers reported using.

“We have five lagoon-style tanks with the lookdown [coral viewers],” said Ashley Hoglund, manager of New Wave Aquaria in Minneapolis. “We also have numerous different frag racks. The most important thing is the health of the corals. If you don’t have healthy tanks, your corals are not going to look healthy and you’re not going to sell them. We are extremely strict on weekly water changes. We don’t allow ourselves to skip a week.”

Hoglund focuses on shifting displays around to keep things interesting.

“We really try to mix up the colors,” she said. “We mix and match to make things pop a lot more, and that’s what [we’re] really having success with. We’re constantly rotating our frags around.”

Marketing

Social Media Outreach

When it comes to building consumer excitement for corals, aquatics specialty retailers have turned to social media, and especially Facebook, in a big way. Retailers report using frequent social media posts to successfully bring customers in to purchase new livestock.

“Our main marketing is through Facebook,” said Manny Corrales, manager of M&F Reefs in Brodheadsville, Pa. “Every time we get a new shipment, we put it on Facebook with some nice pictures. Almost every post, we get people asking and calling.”

Keeping new livestock in front of customers can help retailers generate buzz and cater to customers’ collector mentality to help ramp up sales.

“Our Facebook page does wonders for us,” said Ashley Hoglund, manager of New Wave Aquaria in Minneapolis. “A lot of our regulars know to watch the page because it’s first-come, first-served with a lot of the collector pieces and nice pieces.”

Retailers can also use social media marketing to highlight reef-specific services, such as coral fragging and accepting trades. These activities are common in the hobby, but retailers have to balance serving customers with what’s right for the store.

“Typically, we don’t normally like to take requests just because we’re really busy here,” Hoglund said. “We will if we’re slower. We get a lot of donations from people with colonies that have outgrown their tanks. So we’ll frag those down and throw them out on a frag rack.”

Some retailers offer store credit for frag trades. Creating that community feel and engaging with coral hobbyists helps retailers keep customers loyal.

“We do anything to accommodate a customer,” said Jose Garcia, owner of Living Reef Aquariums in Oakland Park, Fla. “If they have a coral that’s too big, or that they’ve just grown tired of, we always take them. They can take a new species and continue to grow stuff and trade.”

Customer Education

Staying in the Know

The reef hobby can be highly technical, as anyone who has kept corals can attest to. So, for retailers, this aspect of the industry means focusing on education to keep customers happy, successful and invested in the hobby.

“People come in and you feel them out, what they know, and you go from there,” said Natalia Washington, assistant manager and coral farming specialist for Barrier Reef Aquariums in Renton, Wash. “You have beginners who have never seen coral ever, and some people don’t want your help. [Still,] lots of people really want to be educated.”

Though a lot of information is available on the internet, customers still go to their local specialty store with questions. Retailers often position themselves as experts to help build trust and rapport with hobbyists.

“We leverage education 100 percent,” said Andy Seagraves, owner of Brentwood Reef Supply in Brentwood, Calif. “Sometimes, it can get pretty hectic in here with people asking questions.”

Getting the corals customers want can also be a challenge, and retailers said they stay vigilant to make sure they know what’s changing in the distribution chain. Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES) restrictions for certain kinds of corals exist, and they play a role in what’s available either seasonally or, in some cases, all year long.

“There are always regulations,” said Jose Garcia, owner of Living Reef Aquariums in Oakland Park, Fla. “That’s why I don’t bring in anything direct, because then you have to [be aware of and] follow all the rules and regulations. I let the wholesalers take care of that. Whatever they bring, that’s basically what we have available.”

Recently, imports of live rock from Fiji were briefly banned, though the restriction has since been lifted.

“We immediately saw a change in live rock prices at the wholesalers,” said Manny Corrales, manager of M&F Reefs in Brodheadsville, Pa. “It started getting more expensive right away. You start regulating where you can and can’t get it from, or reducing the places they’re available, and the prices go up.”

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