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Waiting For Customers Will Cost You Money

Do you sell one of the products customers can “wait” on?

Like a new mattress?

How about a new crown?

Maybe a new refrigerator?

Or a hair cut?

Just about any product or service business can say, “Oh, I’m different, my customers can put off purchasing a new ___ or fixing the ___; they can wait.”

But that’s the problem isn’t it? They CAN’T wait.

It’s not like that Star Wars DVD you place on the shelf and it will still be there, exactly as you left it.

What happens if you put off that new mattress? The mattress you are currently using continues to deteriorate. Your back gets sore.  Your legs get more restless. You toss and turn.  Your deep sleep declines. You wake up more grumpy. Less rested. Less happy. Continue reading Waiting For Customers Will Cost You Money »

Small Business: The World Needs What You Have To Sell

I recently read a blog post that the world doesn’t need what you have to sell; that the world can get by without it. And if they do, they’ll get it with or without you.

Well yes, I guess that is true to some extent.  But I think the world needs what you have to sell.

I was selling when I was 3

Take coffee for example; everyone knows it.  If they were to blind taste-test it, I’m sure 90 out of 90 people could tell you, “that’s coffee.”  But is it good coffee? Is it bad? Is it old? Is it to their liking?  All of that comes about by educating customers as you sell them.

For example, as a coffee drinker, do you know why the coffee you make at home doesn’t taste as good as the coffee you like at the big chains like Starbucks or Peets?  Here are a few facts:

Since coffee is 98% water, they use a reverse osmosis system which removes microorganisms, organic chemicals, and inorganic chemicals, producing very pure water.  Most people use tap water full of impurities and chemicals.

Since coffee loses 25% of its’ flavor within two weeks of roasting, they only use coffee roasted within days and keep it whole bean until just ready to brew.  They store it in airtight containers.  Many home users store their coffee either whole bean or ground in the refrigerator freezer where it can absorb flavors and the delicate oils can degrade.

Since the true flavor of coffee is produced by the oils which rise to the surface of the bean during roasting, the beans are ground which allows more surface for the oils to mix with the water.  Most home grinders slice and dice the beans which also builds up heat degrading the oils.

Coffee oils are what make it delicious

Since you only have one shot at getting the oils from the beans, they use water just off boil to flood the grounds and drain quickly which releases the oils but leaves the “graininess” of the beans behind.  Home brewers often recirculate the coffee back over the grounds which brings out the grainy flavor.

Since the beans are to be brewed for drip coffee, they grind the beans specifically for that brew method. Many consumers use a generic grind which can be too large letting the water go through too quickly for the oils to release or too small letting the coffee’s more bitter flavor come through.

Since the oils are what makes the coffee, they use a lot of coffee, about two tablespoons per 6 oz of coffee, that’s about a ¼ cup for a 12 oz mug.  Most people use half as much which results in a weak brew.

Most people use a cheap coffee maker which never gets the water hot enough and then keeps applying squirts of coffee over and over to the beans which gives a weak brew, more like dunking a tea bag than brewing the coffee.

Since coffee begins to break down after brewing,  chains throw out unused coffee on a regular schedule (usually within two hours) and they never put on a burner or reheat.  [Except in Canada where consultant Doron Levy posted about Tim Horton’s] Some people actually reheat coffee in the microwave.

Do you need all that information? Do you want all that information?

An Analytical personality probably will want all the nuanced details which make the coffee better.  A Driver personality could probably have a taste test with a cheap Krups $39 machine and a Capresso $219 machine with the salesperson demonstrating how the coffee tastes and let the customer decide.

The problem is 63% of the world, the Expressive personalities and the Amiable personalities, will be overwhelmed by much of that information and even the price tag.  They often settle because no one ever took the time to show and sell them the differences of what it takes to get as close to their favorite coffee house taste as possible.  So they settle for the $39 machine because Macy’s has a coupon, robbing themselves of the experience of a great cup of coffee in their home; especially if they are trying to save money by making it at home in the first place.

I used coffee in this example but it could just as easily be window coverings, flooring, cashmere sweaters, you name it.  Price doesn’t make something a good value – people do – sales people do.  Until you and your crew can understand and model that, you’ll be stuck with a race to the bottom cutting profits and crying the blues.

You want to succeed in 2010? Remember, the world needs what you have to sell!

To learn more about the various personalities and how they play out in your crew and customers, pre-order my new book, The Retail Doctor’s Guide to Growing Your Business (Wiley & Sons) shipping mid-April.

We Mean Business High On Tears – Not Results

There was a show on A & E last year that is still on the web, We Mean Business.  I should’ve realized the key word was mean.  Since I received contact from a guy who just saw it, I thought I’d share my thoughts about the show.

The gist is that Bill Rancic, winner of The Apprentice and a “tech guru” and “designer” have 48 hours to transform the attitude and the operations of a small independent business.  And they are all about the attitude – their own.

A & E's new show

A & E's Newest

From the moment they sweep into the shop everything is terrible and they have come from the mount to save the poor wayward fools at, in this case Berry Elegance.  The designer has to be the most annoying person ever seen on a business program.

Don’t take my word for it, look at their promos; which were worse!

I’ve done business makeovers for nearly twenty years, including for the Los Angeles Times.  They are never fun or easy but one thing I learned early on was that you don’t belittle people – especially in front of their employees.  Not here, that must be part of the “fun” of having a reality show purporting to show people how to manage their business.

What interests me about this show as well as Bravo’s, Tabatha’s Salon Takeover is that the “experts” come in, denigrate the shop, fill it with new fixtures and (since We Mean Business is sponsored by Dell – lots of new computers) they go on their way because they said that was what was truly needed.

Now don’t get me wrong, I am a big believer in sprucing up a shop. For Berry Elegance, it looks like they copied Godiva’s and it sure did look great!  Many of the ideas had merit including the use of color – if you could get past the condescension.

I think what will further distance viewers is to realize they don’t have the kind of money to pour into their business for new fixtures, signage, plasma screens, registers and computers.  And really, who needs to scan a barcode for a one-off shop that has very limited skus?  We’re talking a shop for chocolate dipped strawberries here.

They could have counseled her that a 5% online discount is worthless on a premium product. Instead of showing who’s eating them – how about trying to sell them with descriptive text?

And if you are going to have a blog Berry Elegance - especially if you are going to be on national television – update it for gosh sakes!  A & E visited them in June, the last post was March 13 – didn’t the “technology guru” think to look at their website at least once?

These reality show makeovers would lead small business owners to conclude the magic bullet is in the physical attributes of the store.  Nothing could be farther from the truth.

If you watch the follow-up clip on A & E’s site, you see how Amy, the co-owner of Berry Elegance is in just as much trouble as before but in a much nicer space.  In fact the employees and her co-owner Todd Jones have left Ms. Stipa to run the shop on her own.

Those great embroidered white chef’s aprons given as a parting gift from Bill and the gang? (Spot on Bill by the way!) Nowhere in sight.  She did hire a PR person to get in front of celebrities which got a large order – but at what expense?

The clip shows her ringing up a $6.50 sale.  Selling is a big problem for this owner which was ridiculed but largely unaddressed. My Five Parts To a Successful Sale retail sales training DVDs could help http://retaildoc.com/products/rxwhatyouget.htm .

Change takes time; meaningful follow-ups are what are needed whenever a business makeover is completed.

There are pitfalls to any business whether it is new, old, successful or struggling.  What you have to remember about reality shows is they are designed to make it look easy and to hype the tears.

To help you get real results right now, you can find a few of my ideas how to market your business at http://retaildoc.com/articles/market-yourself-article.htm.

And if you are looking for a host of a reality show based on results and not hype, give me a call; the Retail Doctor makes house calls.

Sales Techniques: Are You Unable To Close Expensive Items Because You're A Fraud?

Are you a fraud? Are you asking customers to purchase something you yourself wouldn’t because it is “too expensive?” I was.

While I was finishing college,  I applied for a job at a western wear store. It was actually a growing trend back when Dallas and Dynasty were just beginning their meteoric rise.

I aced the job interview but when they asked if I wore western wear I confided I never had. They had a program where you could buy a pair of defective Tony Lama or Justin boots for $50. It was seen as a good way to get employees into wearing the better merchandise the store sold without breaking the bank. I got a pair of plain brown Justins. They felt good but something was off in the heel so after awhile, my feet actually hurt; working my 9-9 days were murder.

I’d do my best to tell people all the features and benefits of Justin, how they were a hand-pegged 3/4 welt which meant it was stitched 3/4 around but 1/4 had an extra amount of leather removed under the arch, around the shank of the boot with lemon-wood pegs to hold the boot together. Those pegs allowed a better fit and lemon wood swelled and shrank with the moisture in the leather soles so they didn’t fall out.

3/4 hand-pegged welt

I tried my best to get people to buy them for $189 but inside I knew I hadn’t believed in them enough to buy a good pair myself; I settled.  This led to me not pushing through to justify the product but fold my tent and suggest something cheaper or for them to wait until they went on sale.

Could that be you? Are you a window coverings store only able to sell the honeycomb shade because that’s all you’ve put in your own house – at manufacturers cost.  Do you sell Tag Heur watches only to wear a Swatch yourself?  Do you sell Cadillacs and drive a Ford? Do you silently believe your own product is too much? Maybe you feel like a fraud.

One day I realized the market for exotic boots was hot; the more I sold the quicker I’d make my store sales goal so I purchased a pair of Tony Lama pieced ostrich boots. They were not a full skin but for $399, they were still a huge step up.  Since my personal sales went up, I purchased a pair of custom Tony Lama El Rey full quill ostrich with inlays.  When a customer said they “couldn’t afford it,” I could easily sell how much enjoyment I got out of paying more and getting more.

El Rey Tony Lama Ostrich Boots

When a customer can’t decide on whether to take their big old pile of cash in the bank or credit on their card and make the premium or luxury choice, you need to know what it took for them to purchase.  That comes from owning the product yourself.

Then you can empathize with your customer that it seemed like a lot of money to pay but you found x, y, and z once you owned it.  Without that first hand experience, you’re like a priest telling a newlywed couple what the wedding night would be like.

Buy one of your premium products this week, experience the reservations that a customer would, know the joy of breaking through those reservations and enjoying the product – do that and you’ll find you’ll be able to speak from the truth rather than trying to give a snowjob when selling your premium merch.

If you’re ready to sell your merch better, take a look at the opening five minutes of Sales RX at http://www.youtube.com/bobphibbs#p/a/u/0/tEAaExPRlKQ

Pepper Your Sales Presentation to Remove Salt of Insecurity

Ever been at a great dinner and use the salt instead of the pepper? The whole entree is ruined.  This rather lengthy blog is about peppering your sales approach to avoid the salt of insecurity.  A colleague of mine, Carol Spiekerman posted this on her blog recently. I’ll share my comments after but here’s Carol’s story:

images-7

“Last Saturday, my just-divorced friend and I spent two hours browsing Best Buy (breaking my previous record by about one-and-a-half).  After a long and icky battle, she and her ex-husband finally made it official, and she was excited about trading her “perfectly good” (according to her dear ex) Flintstonian, room hog of a television; receiver and speaker set-up for a streamlined home theater system.  She’d asked me to accompany her because she was “clueless” about technology yet ready to splurge big time; she wanted me to have her back.  BTW, both my friend and Mr. Ex had enjoyed soaring salaries even during the recession, so funds weren’t the issue.

Every minute of this visit reeked of “customer centricity.”  The sales associates could not have been more professional:  the first one deftly guided us through computer speakers— though they were not even on my list, I started poking around.  Plugging his iPhone into the demo unit and flashing a conspiratorial grin, he took me up on my dare to crank up the volume on the $150+ Klipsch set . . . and when it came time to head to Home Theater, his seamless hand-off to a senior associate was a real thing of beauty.

Once there, we were treated to an effortless non-pitch that had Senior Blue Shirt translating the latest in TVs, receivers and speaker sets from high-tech to low res without so much as a whiff of condescension.  The more time we spent with him, the more confident my friend became in her decision to make an investment that would surpass any she’d personally made in the last ten years.

The power session wrapped up with Senior Blue Shirt offering to write up everything he had recommended, and that’s when the sale started going off the rails—and here’s why:

The five minutes that he was gone was just long enough for my friend to lapse into doubt mode, even though I was fully supporting the vision for the new home theater.  Nothing that couldn’t be overcome at that point.

When he got back and began walking us through the quote, the situation became unnerving for a few reasons:

Installation – What had previously been described as a fairly straightforward process suddenly got more complicated.  First quoted as a general estimate of “about $300,” the installation fee then morphed into a “range” of “$100 to as high as $800.”  Of course there are reasons for the range but that provides no comfort for the wide variation.

Delivery – Another unexpected complication, as visions of Geek Squadders magically appearing with everything—plugging it all in and turning it all on—regressed into to a two-phased commitment that would include greeting a trucking company for the television and Geek Squad for the remainder.  AND, it was revealed that the non-TV components would need to be brought home by my friend while the centerpiece of the system, the television, would be brought by the trucking company in “a couple of days.”  Not exactly seamless nor efficient and some of that stuff looked pretty heavy. That shut off the instant gratification switch.

Timelines – There was no discussion of specific timelines; only ranges.  Senior Blue Shirt’s low-pressure accommodations gave my now-skeptical and fearful friend “permission” to leave the store gracefully, and that’s just what we did.  My computer speakers were a distant memory by then and no one sought to remind me on my way out.

Back at her house, my friend turned on her perfectly good TV and twenty-year-old stereo and said “You know, I really don’t watch television that much . . .”

What I heard in this story was one of disappointment. The customer felt they had made a friend, one willing to help them out, one who could make it simple and one who “got them.”  Their disappointment came when the customer found an overwhelming array of “yeah, buts” that greeted them at the end.

How to get past this? Pepper possible disappointments during your presentation to soften any blow about timelines, special orders, variation in color, etc. at the end. For example, “We can set the whole system up for you after you get it to your house. If you can’t take the whole system with you today, we’ve got a company that can get the heavy pieces there while you can take the lighter ones with you – just to be sure they don’t miss anything.  Make sense?” Then go back to what you were talking about.

Peppering your presentation with information that could make the customer uncertain or insecure in their choice keeps you as their friend instead of a sudden enemy. Want to read more? Here’s an excerpt from my book, You Can Compete: Double Sales Without Discounting that also ilustrates this point:

At Howard & Phil’s western wear I inherited a store where employees didn’t see how they were making customers insecure.  I could see it when a customer pulled on the boot and said, “Hey these slip in the heel.”
The untrained salesperson replied, “Oh yeah, they’re supposed to do that.”
The customer would walk around then say, “But the front feels tight.”
The salesperson would react and say, “Oh yeah, new boots do that.”
The customer took off the boot and said she’d look around. Next thing you know, she was gone.

To make customers secure, I would train that  while the salesperson was waiting for a customer to remove their shoes, they’d ask, “Have you worn boots before?” 9 out of 10 times they would answer, “No.”

“When boots are new they will slip in the heel and the foot will feel a bit snug. The sole will relax as you break them in which takes about a week of wearing them.”

Invariably the customer would try on the boot and say, “Hey these are loose in the heel.”
The salesman could then reply with a smile“Remember, I told you that?” careful not to smirk.
“Let me walk around in them.”
Salesman, “How do they feel?”
Customer, “They are a bit snug up front.”
“That’ll go away in about a week.”

Because the customer could feel they were safe, we increased that store’s closing ratio by 30%.

In the first scenario, the salesperson was on the defensive, reacting to the customer and losing credibilit;, it let the customer think the salesperson was just a bit dishonest in trying to make the sale.

The second scenario put the salesman in the place of knowledge and power. Because the negative qualities were peppered beforehand, the customer knew what to expect and felt safe, that the salesperson could be relied on for further information.

If you make the customer insecure during the moment they are deciding or paying for your merch or service, you will then be trying to placate a nervous customer. By then though, the trust and relationship are gone and you’re left coming up with excuses to your boss.