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Archive for October, 2008

Retail Marketing: Sarah Palin Only Took Care Of The Regulars

OK, I plan to do a few posts using the politcs of the season as broader lessons for retailers in general.  (It is not meant to pick on any on candidate or party.)

Sarah Palin’s pick was McCain’s stated attempt to attract those women who voted for Hillary Clinton.  

Sarah Palin

Sarah Palin

While the Palin selection did energize the Republican faithful for about a week,  in a poll published in today’s New York Times,  nearly 60% of likely voters felt she hurt the ticket.  In short, her selection didn’t bring new voters to McCain, it reinforced those who already were likely to support her. They could look past the botched interviews and experience questions.  The very people McCain needed most however took a more critical view. 

For retailers, this is a classic case of only attending to the regulars.

Many times when I do a retail business makeover, I ask if they have a mystery shop program.  “That’s not necessary, our customers love us.”  Many times they’ll even point out a letter someone wrote to them raving about their service. 

But when I perform a series of mystery shops, we usually find that new customers are not welcomed and in fact, because they are not a regular, they often receive below average service.  The anonymous shoppers then rate the crucial question of whether they will return with “maybe” or “no.”  It’s my job to raise those shops to a remarkable level.

Look, your regulars will love you no matter what.  It’s the new people who first discover you that need to be courted, monitored and encouraged to return.

If you’d like to know more about the mystery shopping service I provide, shoot me an email. In the meantime, concentrate twice as much on the new customers than the returning customers and you’ll be on the road to a winning strategy to grow sales.

Retail Doom and Gloom – Don’t Believe It [Video]

This is an archive post from when the recession was getting into high gear in 2008.  Still applicable, business is as much about fear and mindset as possibilities…

I was at the Retail Merchants Association Economic Summit in Richmond, Virginia as the recession was gaining traction.

Bob Phibbs at Retail Merchants Alliance with Alan Gayle

Bob Phibbs at Retail Merchants Alliance with Alan Gayle

You can watch the ten-minute video here on YouTube and see my thoughts.

The setup: two well-respected economists give their facts and figures and talk about the upcoming holiday season.  After twenty minutes of doom and gloom, it was my turn.  (On the video clip, we’ve reduced them to about a minute.)

Yes, there is a fire in the economy that is going to burn poor businesses but it doesn’t have to be you.  Watch the clip to find out why and how.  BTW –  if you click on the “Watch in high quality,” on the bottom of the player you’ll get the best picture.

There will always be anthrax, Y2K, sars, terrorists and fear.

We can only do what we can do in our corner of the world, our business, our thoughts, our actions, our family. It’s either, “Holy crap, what now?” or “What can I do now to move myself, my business and community forward?”

That’s your choice. There is no middle ground.

Retail Service Draper’s Can’t Be Bothered

A week ago, my brother answered the phone to hear a computer voice saying “Happy Birthday”.  The call was from Drapers & Damon’s in Pasadena, and was a phone invitation for my Mom to come over and do some shopping.

Well, while it wasn’t quite her birthday, she did have to go over to Pasadena that afternoon for a follow up appointment with one of her doctors.

When that was taken care of, my Mom told my brother she wanted to just “go by” Drapers & Damon’s to see if she could find a few more suitable tops or blouses.

My brother let her off at their rear entrance, and tried to find a parking space. Mom was soon making her way back across the alley empty-handed.

She got into the car, and the first thing she said was “Not a soul in there even bothered to acknowledge me.”

She’d gone in, found a rack with some possible blouses, taken them into a fitting room and tried them on.  But, nothing fit, and after ten minutes, she didn’t care to keep searching.  So, she returned the tops to the rack, and walked back the length of the store (150′ or more) without anyone saying a thing to her. [check out Marge Laney's free whitepaper on Fitting Rooms here.]

She thought it all seemed rather rude, especially since they’d made the specific effort to call her on that very day and invite her to do some shopping!

This scenario is being played out equally across the country from department stores to premium boutiques.

The number one reason people don’t return to stores is when they are ignored, the other three are being lied to, under-appreciated and pressured.

My message to all retailers is simple: don’t invite people to a party that’s no good.

Marketing got my mom in, but the lack of sales people drove her out.

It’s not the economy that’s failing, it’s store management. Lack of retail sales training will drive customers out of business and no amount of marketing – computer or human- will save you.

We Mean Business – Missed Opportunities Still Abound

OK, so I had about a month of shows to watch on my DVR of the A & E “business makeover” show We Mean Business. I won’t go into too much detail but felt I should weigh in a few critical issues for the business owners who regularly read this blog. ( If you missed my detailed posts on two earlier episodes they appear below.)

Brownstone Pizzeria- Owners Bertha and Gunther Donoso really missed it. During this episode the team did the usual store makeover with reveal. All went well until the team, (Bill Ransic, Katie Linenendoll, Peter Gurski,) came back just one week later to see how it was going. 

Practically everything they’d put in place was gone – the new counter, the new digital camera that took regulars’ pictures and displayed them on a flat screen, the new menu, the tablecloths, the remote printers and the uniforms.  Gunther proudly told the camera he took it out within three days.  It was “too different” for him and “took away too much dining space.”  This makes for great TV but lousy business advice.

In the follow-up that you can view online we find out business is the same as before.  Yet this guy Gunther says he was thinking of opening a second store or expanding. Are you kidding?!

The crucial lesson We Mean Business needs to point out is the hard stuff – changing a business mindset.  All the Dell computers in the world won’t make a business profitable and if you can’t make the owner understand that then it is your fault Mr. Apprentice Bill Rensic .  Tactics that make an owner feel stupid or incompetent can only get you so far and often backfire.  Missed opportunity: reality check.

Wagville – Owner Julie Shine loved playing with the dogs more than working on the business. In the follow-up we hear her say she’s now more focused on trying to run the business than making sure the dogs in her doggie day spa have a good time. The team did get the crew excited to begin selling the merchandise in the store but that appears to have disappeared.  All the big bins of dog food were moved back up front because, “it was too difficult to go in the back and get them.”

One of the opportunities the team mentioned was the long check-in time.  Katie created a one-stop checkin but it was not functional during the follow up.  We also saw Julie, the owner, ordering one or two products from a catalogue in blase fashion. She seems like an average employee, not an owner fighting to save her business.

The owner must see exactly what working on their business is – aggressively promoting services to every customer who walks in, finding partner businesses to cross-promote with, having employees brainstorm new ideas.  Missed opportunity: change. 

Both of these episodes pointed back to people saying how “difficult” something was.  It’s only difficult if that’s the way you approach it.  A buddy of mine used to work pouring concrete.  One day a load of forms arrived and he said, “Damn that’s a lot of work ahead of us.” His brother replied, “Look, we’re just going to be doing forms all day. What’s the big deal? Change your attitude about it – it is a job.” Exactly, what’s the big deal? Did you want to grow your business or have the opportunity to proudly not change?

The Sensitive Baker – Sandee Hier got it. Business has gone up so she must have taken some of the advice to heart. She got the branding, she got the need to market to more than just the gluten-free crowd and she’s now got her husband monitoring her on a regular basis and has lowered her ongoing losses.  She’s not out of the woods, but I think she just might make it.

In sum? We Mean Business is still essentially an HGTV store design program with heavy Dell product placement. Concentrating on how the facility looks is a good beginning.

In my book, You Can Compete: Double Sales Without Discounting, I always start a business makeover with the facility. Those four walls both inside and out are the first things your customers see.  The second stage I work on is the people in the store; the crew and the owner.  If they can’t sell the items inside, no amount of paint and mirrors will help.  Finally after all of that work is done I tackle the marketing. You don’t invite people to a show that’s no good.

It’s a formula that has helped thousands of stores compete from some of the biggest to the smallest – whether economic news was good or bad.  It might help you too. 

After all, I truly mean business.

 

Bad Customer Skills – You Can’t Get Away With It Anymore

I was presenting at the Retail Merchants Economic Summit in Richmond, Virginia this past Friday morning. Unsurprisingly, two economists gave fairly bleak assessments. One of them was Scott Krugman, a vice president at the National Retail Federation, while acknowledging they expected a 2.2% increase in sales, he became the lead quote on NBC channel 12’s news that it could be the “worst holiday since 2002”. He also talked at the summit that it would only be discounting that would bring customers in . That was not news - it is exactly the same thing he said last fall as well.

When I got up to speak, I asked everyone to take a deep breath and repeat after me, “Life sucks!” They did that and said, “That’s what the economists want you to believe.” I challenged the audience, “What are you going to do with that information?”

Many independent businesses still don’t think they need an online presence with their own website or to sell the customer the merchandise in their store. If not now, when?  In many ways, you are the master of your own destiny.

Afterwards, an editor of the local business paper told me he enjoyed my speech but I should, “Lay off the media. We didn’t make this.” My voice jumped to attention. “Give me a break! The media has been looking to put a bright red R on the economy since 2006.” I know, I tried to sell a house for two years. I saw all the adjectives, “worst,” “disaster,” “plummeting,” etc. all over the newspapers, online sites and news reports. You don’t build an economy on fear; you have to have balance it with some hope.

And now the bailout is done, but what do the talking heads have to say about it? “Band-aid.” “Won’t fix the problem.” Etc. Life sucks – to be continued as long as they need the ratings.

My point to you is this is non-information for retailers. Nothing has changed in the past 24 months except we have been beaten back into a cave with fear; everything from the price of oil and credit to corn, wheat and milk is “rocketing” to new “all-time” levels. We seem to feed on the rotten idea that something even worse is right around the corner. That’s not what made America great and its not what we need to turn the tide on a struggling national economy.  Just because economists see the impact of recent events on the broad economy does not mean all businesses will be effected equally.

It is time for you to fight for what you do.  But you’re going to have to change.

If you still feel you can answer the phone in 20 rings, if you still feel you can answer email weekly from your website (if at all,) if you still feel you can compete having slacker employees, I’ve got news for you. You can’t. If you think you can just stock the same stuff as anyone else or throw a 15% off sale every weekend – it won’t work.

The market won’t reward you any longer because the pool of easy money has drained. There are more people chasing fewer customers.

Only if your eyes are on your customers, are you going to be able to survive and thrive.

At the end of my talk in Richmond, the manager of Jason’s Deli came up to me and told me that their catering business – you know one of the most disposable of incomes- was up 19.4% in September! His motto, “We only sell service – the food is a by-product of what we do – we SELL!”

Great example and I know scores of others who are increasing sales in this “punishing economy.” If you’re not, look in the mirror – it’s probably you.

Going to change? If not now, when?

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