RentDirect Nationwide Vendor Show Begins; Bud Gates' Presentation Seen Live By Viewers on Every Continent

RentDirect Nationwide conducted a two hour Member 2 Member meeting before the opening of its semi-annual vendor show that featured a keynote address by Bud Gates, former President of Rent-a-Center and current Master Franchisor for Canada's easyhome rental concept in the U.S.

Gates' address was carried live on the RTO Online website via live streaming video, a first for the rental-purchase industry. More than 100 dealers attended the meeting in person and listened as Gates discussed how historical trends in the rental purchase industry can help predict what the future of the sector will look like. See the replay of Bud Gates' live video presentation here.

"The industry is healthy. It's growing, and consolidation has played a part in that. New products continue to provide a lot of opportunity, and we are facing dramatic changes ahead," said Gates.

One major change Gates' sees affecting the industry is the shifting demographic make up of the country. With Hispanics representing 15% of the current U.S. population, dealers "have got to accept that a disproportionate share of growth will come from this segment. Half of all population growth in the U.S. is coming from Hispanics."

Gates says the number of Hispanics in the country has doubled since 1990, and stresses that Hispanic customers traditionally benefit from the rental-purchase transaction.

"Hispanics are younger. They have a median age of 27 compared to 36 for the population at large. They also have a lower average income – $36,000 compared to $46,000 for overall U.S. households."

Gates underscored the importance of reaching Hispanics by quoting a government statistic that predicts by the year 2050, 25% of the entire United States population will be of Hispanic descent.

When it comes to the products that will drive rental revenue in the future, Gates took his cue from a household product penetration chart dating back to 1945 that showed the length of time it took for popular home electronics to become ubiquitous in every household. Gates says computers represent a huge growth opportunity since today they have a household penetration between 70% and 75%, roughly the same penetration enjoyed by television sets in 1957 and color TV's in 1975.

There were less obvious products Gates felt would have an impact on rental dealers, as well. "Personal security devices. The technology is there to have multiple inputs linked into your cell phone that are also linked into the police. There are a lot of things that will happen on the personal security side that will make it an RTO product down the road."

He also envisions small cars with even smaller price tags, such as those manufactured by Tata Motors of India that retail for approximately $2500, as possible rental items.

On the marketing front, Gates stressed the importance of staying "contemporary" with store design, and also with your company's message.

"The big news for us is the internet. Online marketing is the fastest growing part of marketing and it's ready right now to be a significant part of the rental marketing mix. If you're not using it or soon to use it, you're going to miss the boat."

Gates predicts much of his company's growth in the U.S. market will come from customers who fit the rental demographic, but have never chosen to rent because of preconceived notions of what the experience would be like.

"What I see, at least with easyhome, is that we are beginning to get in RTO people who have never been in a store before. With the easyhome store we're hearing people say 'This is like a regular (retail shopping) experience.'"

From the show floor
RentDirect opened more than 180,000 square feet of vendor exhibition space yesterday which was quickly flooded with 3,500-plus people conducting business. Hundreds of rental industry professionals from more than 120 different rental companies were on hand.

"The biggest advantage is you can come here and truly shop all the big boys side-by-side," said Tim Hector of National Rent-to-Own, who was checking out the RentDirect deals along with Dan Cole and Steve Braning. "This is the place where you can truly compare programs, including whether you want to bring in a line for just 1 or 2 stores versus buying a whole truckload of merchandise to feed your DC's."

One of the new products that most impressed Hector and the rest of the National Rent-to-Own team was the real-time customer application verification process developed by DATATrue.

RTO Online recorded a podcast interview with Dan Jobrack, Executive Vice President of DATATrue as he demonstrated his company's revolutionary real-time information verification system. The DATATrue system allows rental dealers to verify customer information such as social security number, address, phone number, employer and even banking information – all in less than one minute and less than $1 per inquiry.

Another booth that was bustling with activity was easyhome. RTO Online was able to lure Master Franchisor Bud Gates away from the crowd where he revealed how easyhome's Canadian management team attracted him back to the rental-purchase industry. Gates has a strong feeling that the easyhome concept, which enjoys a 65% market share in Canada, is positioned to make great strides throughout the United States, as well.

RTO Online is the official channel for Rent-to-Own Industry News and the only independent source of news for the rent-to-own, rental-purchase, lease-purchase trade. RTO Online (Rent to Own Online) represents the choice of the entire RTO Industry for trusted information, as it happens.

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