Friday, June 29, 2007

Save Your Customer's Time

"According to a Wall Street Journal article, the average shopper at a Wal-Mart Supercenter spends 21 minutes in the store and, in the process of speeding through the shop, fails to find 30 percent of the items they came in to buy." (Source Retail Wire)

That's the advantage a small, boutique store has over their big-box competitor. The challenge is helping your customers recognize that you can save them time. In today's time-strapped society, you can gain a signifigant advantage by demonstrating this to your customers. You can't compete on price so why not focus on the time element?

Case in point...I much prefer to shop at a smaller hardware store and grocery store than the big competitors because I know I can get in and out of the store FAST.

Why not loudly and proudly state this in your advertising? This certainly goes against many retailer's philosphy of advertising specials and low prices. But, if positioned properly, you could attract many consumers away from your big-box competitor. The change would not happen overnight (there's no such thing as a quick fix) but it could be significant.

Got comments on this posting? I'd love to hear them.


The Art of Skillful Qualifying

I am constantly under whelmed when sales associates approach me in a store. I find they typically use one of a few approaches:

1. They stand and wait for me to ask questions.
2. They launch into a pitch about the product.
3. They attempt to make small talk to try to make me open up.

Each of these approaches is very ineffective and does nothing to help the customer move toward making a buying decision. If you really want to make a difference and demonstrate to your customer why they should buy from you need to take a different approach.

First of all, recognize that if you truly want to separate yourself from your competition you must fully understand their needs before you begin talking about a product. Unfortunately, this seldom happens in the retail sales situation. However, that can make it very easy for you to begin differentiating yourself from other retailers. Here’s how you do it:

Ask questions.

§ What brings you into our store?
§ What reasons do you have for buying a…?
§ What were you looking for in a…?
§ Who else is involved in this purchase?
§ What is most important to you with this purchase?
§ Where else have you been?
§ What was your experience at…?

Each of these questions gives you the chance to uncover the customer’s buying motives. Every time you learn more about your customer the closer you get to actually closing a sale providing you utilize that information properly.

You’ll notice that the above questions are all open ended which means they require the customer to respond with more than just a ‘yes’ or ‘no’ answer. Open-ended questions serve two purposes;

1. They require the customer to think before responding. This means that you will receive quality information that will help you determine their specific needs and wants.

2. They actively engage the customer. This means that they will begin to feel more comfortable with you because they are actually participating in the buying/selling process.

The critical thing to remember is that virtually everyone in the world loves talking about themselves and the more you encourage the customer to talk about themselves or their situation the more they will begin to trust and open up to you.

The majority of retail sales staff do not appreciate the power of this approach. In my training workshops I frequently hear objections such as:

“This process takes too long. I don’t have time.”
“People get defensive when I ask them questions.”
“Customers only care about getting the best price.”

I definitely understand these objections. Effective qualifying does take time. Some people do get defensive. And some customers do care only about getting the best price. However, this approach will garner you different results.

First of all, the time you invest qualifying will be saved in presenting your product and trying to overcome objections. If you fully understand what your customer needs and want you will be able to show them a product/service that meets those needs. This means that they will have fewer objections. I have discovered that the more thoroughly you qualify a customer the less likely they will express objections.

Second, if you create a comfortable environment people will answer any question you ask. But you must give them a reason to do so. They must see that the question(s) you are asking are leading somewhere and are being asked for a specific reason.

Third, you need to determine if the price conscious customer is someone you really want as a client.Skillful qualifying takes effort, energy and practice. I suggest that you develop a list of open-ended questions that are relevant to your industry and practice utilizing them. The more comfortable you become asking valuable questions the more effective you will be become at uncovering your customer’s needs and wants. In turn, you will demonstrate to them why they should buy from you, today, at your price.


Wednesday, June 20, 2007

Merchandising Matters

I was recently looking to replace my cell phone and ventured into my local wireless provider's store to view the current phones. It had been over two years since I purchased my phone so I expected to see some great updates and a wider selection to choose from.

As I wandered around the store and checked out their available wares, I noticed that the only information about the phones that was visible was the price.

One phone caught my eye but it was gross pink--a colour I wouldn't even dream of carrying around. My wife asked the salesperson if that phone came in different colours--a question I didn't think of asking. Fortunately, that particular model was also available in a steel grey, and after seeing it, I bought it.

However, had my wife NOT asked that question, I would have left the store without making a purchase.

The manner in in which your store is merchandised will influence a person's decision to make a purchase. In fact, I remember no longer shopping at particular grocery store because they continually changed where products were located. Bundle like-products together. Position complementary items in the same area. If your products come in different colours, make sure your customers can see them. Merchandising makes a tremendous difference.


Monday, June 18, 2007

Creatures of Habit

It's hard to teach an old consumer new tricks, and a new Canadian study explains why.

People like to buy the same products at the same familiar stores simply because it's easier, the paper shows, despite the best efforts of marketers to sell them on better options. From economists to Bill Gates, everyone predicted the Internet would lead to consumers buying wherever they found the best products and prices, says Kyle Murray, an assistant marketing professor at the University of Western Ontario's Richard Ivey School of Business. Instead, they continue to flock to the same Web sites, stores and products they always have. His paper, in the June issue of the Journal of Consumer Research, determined why.

"People learn to use something like an Amazon, and they become more comfortable with it, they become better at using it, they're more efficient with it," Murray says. "They develop some shopping habits that mean they don't shop around, even though it would [take] maybe 15 seconds to find a lower price somewhere else." He and co-author Gerald Haubl at the University of Alberta conducted experiments that approximated online shopping, but the findings apply to stores, electronics or any product people become skilled with over time, Murray says.

Customers often shop on auto-pilot, getting familiar products from familiar stores or Web sites, though a bit more effort and exploration could mean more savings.

One experiment revealed that even if two retailers or products are the same in every way, when consumers are given the chance to use one repeatedly, the familiar option becomes vastly more attractive.

A second experiment demonstrated that consumers are not being duped into thinking their usual choice is better -- it's simply easier for them to get what they want quickly when they've had practice (a phenomenon familiar to anyone who beelines straight for the right aisle to find a specific product in their grocery store).

"The vast majority of what we do day-to-day is habitual or automatic, and it's only the occasional decision that we put a lot of thought into the way marketers think we think about all products," Murray says.

This is known as "cognitive lock-in" and it amounts to a very strong form of product loyalty, he says. "Lock-in" is normally an economic term that refers to the financial cost of switching from one product to another -- the penalty fees cellphone companies charge for breaking a contract are one example -- Murray says. But his study showed there is a "thinking penalty" that may keep people using the same MP3 player, online bookstore or grocery store simply because of the learning curve involved in switching to a new one.

For Loblaw Companies Ltd., the popular President's Choice brand is both a signature that sets them apart from other chains and a constant in their 1,100 Canadian stores, which include No Frills, Real Canadian Superstore, Dominion and Independent.

"It's that balance of making sure that people come back and those things they look for every week are there, and at the same time offering them a few surprises," says Elizabeth Margles, vice-president of communications.

Murray conducted a third experiment that offers some hope for businesses hoping to woo customers away from the competition. Habitual consumer behaviour is "goal-specific," the study showed, meaning people cling to their old standbys for familiar tasks but are more willing to try something else if there's a new task at hand. A customer habitually visiting the same grocery store to buy orange juice and eggs, for instance, might try the one down the street if they're suddenly in search of a birthday cake, Murray says.

Products that undergo redesign and retailers that overhaul their Web sites or stores risk "break[ing] the habits" of their usual customers, he says, because what they used to do on auto-pilot is now unfamiliar -- and that makes switching to the competition an easier proposition.
Gap Inc. is currently engaged in that balancing act, with radical redesigns transforming their stores into sleeker, more intimate spaces. Renovations are underway in Toronto, Edmonton, Ottawa, Winnipeg, Victoria and Red Deer, with the rest of the chain's 157 Canadian locations to follow.

Tara Wickwire, senior manager public relations, says the aim is "innovating and changing to the point where it's new and interesting for customers, yet there's a strain of familiarity."

Ultimately, consumers are creatures of habit. How can you use this to get people back to your store and prevent them from going to your competitor?

Source: Shannon Proudfoot, CanWest News Service

Friday, June 08, 2007

Quit Complaining

While standing in line to pay for a purchase at a local store today, I overheard the sales associate complain about the temperature in the store to a customer. She was lamenting the fact that the air conditioning did not seem to be working although a few days earlier it had been.

In a newspaper article this past week, a retail employee complained about the type of customers he had to deal with and suggested that people be more understanding of a retailer's problems such as inventory issues and being short-staffed.

Several months ago I listened to two employees complain about their schedule directly in front of me.

Give it a rest already!!

As a consumer, I don't care about your problems or issues; I have enough of my own to deal with. And quite frankly, this type of behaviour only fuels my desire to shop at one of your competitors.

I suggest that you--the retail owner or employee--recognize the negative impact conversations like this have on your business. Unfortunately, in my career as a retail consultant and trainer, I have discovered that many owners and managers are the root cause of this type of employee behaviour. are a few ideas to consider...

1. Teach your team to maintain a positive demeanor at all times. This is easier said than done but it can have a tremendous impact. Have them visit other stores in your local trading area and observe the staff in those stores. Get them to share their observations and brainstorm ideas how they can avoid leaving a negative impression with your customers.

2. Hire the right staff. Let's face it...hiring great retail staff is challenging at the best of times. However, too many retail managers and owners hire a warm body simply to fill a time slot on a schedule. Unfortunately, this means that they often end up with the wrong person. Hire for attitude and personality rather than job experience and many of your problems will disappear.

3. Lead by example. This is, by far, the most essential ingredient. If you fail to maintain a positive behaviour, your staff certainly won't either. I can venture into almost any type of retail store and tell you--within 5 minutes--what the management team is like simply by watching how the staff behave. Remember, your actions speak louder than words.

I know that running a retail operation is no easy task. I also know that a multitude of problems can crop up at any given moment. However, complaining in front or, or to, your customers, serves no purpose.


Friday, June 01, 2007

Stand Out With Service

A recent article I read (I don't recall where I saw it) stated that many customers now expect less-than-great service when they shop. The first thought that jumped into my mind was the incredible opportunity this gives the smart retailer.

If your competition provides average service, you have the opportunity to increase your marketshare simply by improving your service. But what does this entail? Or, how do you define good or great service?

Certainly service is a personal issue and what is important to one customer barely matters to someone else. However, I believe there are two key ingredients that almost everyone looks for.

1. Friendly & helpful staff. This means employees who smile at customers. Sales associates who have a positive demeanor. Employees who possess a genuine interest in other people. Teach your employees to be proactive in helping customers rather than waiting for your customers to take the initiative.

2. Quick resolutions to problems. The majority of retail sales associates seem bound and determined to make excuses for problems instead of correcting them quickly. Customers don't care about your policies, problems, or internal issues. They want their concern or problem fixed--fast and without hassle.

I know this sounds like common sense. However, if you visit your competition I will bet that many of them simply fail to execute. Which means you can stand out from them by making sure that you do.