Wednesday, September 29, 2010

Sleep is the Great Eraser of the Mind

Note: Most of the stuff in this post I learned from Roy H. Williams. Please forgive me for stealing.

Okay, you've made one point, spoke to the heart, made it relevant, and didn't look or sound like an ad. Yet, the needle isn't moving. No one is remembering your message, let alone acting upon it. Why not?

Sleep.

Three Levels of Memory
Everything that happens throughout your day is put into electrical or Working Memory (think RAM like a computer). At the end of the day all of your Working Memory that wasn’t relevant or impactful is erased by sleep, including stuff only slightly relevant or impactful.

Declarative and Procedural Memory are chemical memories. These are stored in your brain (think hard drive). They come from repetition. Declarative is the memory of things you can recall if asked (your cousin’s phone number). Procedural is memory that comes without thinking (slamming your brake when a deer crosses the road)

Frequency is Key
With repetition, electrical Working Memory is converted to chemical Declarative memory, and as repetition continues, from Declarative to Procedural.

The amateur practices enough to get it right (declarative). The professional practices until he cannot do it wrong (procedural).

Hitting the Nail on the Head
Another way to think about it is the hammer and nail. If you hit a nail one time, it will make an impression in the wood. But then the big claw called sleep rips that nail out, leaving just a hole. If you put that nail in the same hole, however, and hit it again, the hole gets deeper. Keep putting the nail into the same hole and hit it over and over and eventually sleep will not be able to rip that nail out.

Some of you might argue that you can pound a nail in one stroke. Sure you can. How many of you know exactly where you were when you heard about 9/11? That happened only once, but the impact was big enough to push it directly into declarative memory (plus there was the added frequency of it being talked about for months on end).

Your ads will not be as impactful as a terrorist attack or space shuttle explosion.

The Magic Number
In advertising, the magic number is three. It takes the average person hearing/seeing an ad three times in seven days before it gets stored as Declarative Memory. And they must hear it three times every week until they need the product or service. And when I say "hear" I'm talking about actively engaged in the ad, not the subliminal effect of background noise.

To get that kind of frequency you need to put your message out there as often as possible. Whether you use TV, newspaper, radio, Facebook or Twitter, your success will be tied to the consistent and constant use of the medium every single day. Otherwise, you are just spending your advertising time and money foolishly.

-Phil

Tuesday, September 28, 2010

Don't Look Like an Ad

My radio ads were roundly criticized when I first started doing them the way Roy H. Williams taught me. The biggest criticism was, "They don't even sound like an ad!"

Good.

That was my goal.

Filters In Play
We are bombarded with advertising - over 5,000 advertising impressions a day! Our brains can't handle all that info. Our brains don't want all that info. Our brains realize most of it is useless and irrelevant. So our brains filter as much of it out of our lives as they can. If it looks or sounds like an ad, the brain shuts off and says don't look, don't listen.

The more your ads look or sound like everyone else's ads, the less likely you'll get the attention of your target audience. (Not to mention the less you'll stand out in the crowd.)

Here is the script of the most successful radio ad we've ever run...
I couldn’t believe it. They were taking customers into the men’s bathroom. Yes, my staff was taking men and women, young and old into our men’s bathroom. And the customers were coming out laughing and giggling, oh yeah, and buying, too. I guess when you find a product that cool, you just have to show it off however and wherever you can. The men’s bathroom, gotta love it. Toy House in downtown Jackson. We’re here to make you smile.

I ran that ad in August 2008. I still have customers asking about the men's bathroom two years later. It doesn't sound like an ad. There was no music or jingle behind it. Just my voice plain and unvarnished.

It Really Works
It didn't look or sound like anything else on the radio, so people heard it. And people responded. We have now sold over 2200 of the product hinted at in the ad, mostly because of trips to the men's bathroom. That ad had legs because we were willing to be different from all the other advertisements on the air, which got us past the filter and into the minds of our customers.

One of the benefits of such an ad is that we also generated a lot of word-of-mouth from it. Everyone was talking about our ad, the local deejays, the newspaper, the local TV, and oh yeah, a whole bunch of customers.

The Wrong Way
But none of that would have happened if it looked and sounded like an ad. I could have written an ad like this...
It fills up your room with a starry night and puts your mind at ease. The greatest new sleep aids, the Twilight Turtle and Twilight Ladybug, are helping parents get their children happily to sleep. If your kids are struggling with bedtime, make sure you get them a Twilight Turtle or Ladybug for their room and watch the transformation. Bedtime becomes fun time when you have the Twilight Turtle or Ladybug in your child's room. Available at the Toy House.
Sales would be in the dozens, not thousands with an ad like that. And I can guarantee no one would be talking about it.

Your message is good. You just need to deliver it more powerfully. When your ads don't look or sound like ads, more people will pay attention.

-Phil

PS For more examples of radio ads I have used, click here.

Friday, September 24, 2010

Not Relevant Equals Not Seen

Are you a newspaper reader? Quick, tell me all the ads you remember from yesterday's paper. No fair peaking at the recycle pile. And don't just guess the big furniture chain or tire store. They might have been in yesterday's paper, or was it last Monday's?

The Invisible Truth
The truth is, the only ads you see and remember in a newspaper are ads for products in which you currently are in the market. If you need a new couch, all the furniture store ads pop out at you. If you need a new car, every auto dealer suddenly becomes visible. Every other ad is invisible. Heck, newspapers are designed to teach us to ignore the irrelevant. Headlines are written to get your attention. If you don't care, you don't read.

The only ads you see are the ones relevant to you.

Relevant: \ˈre-lə-vənt\
a : having significant and demonstrable bearing on the matter at hand
b : affording evidence tending to prove or disprove the matter at issue or under discussion

If it isn't important to us, if it doesn't have significant and demonstrable bearing on the matter at hand, we aren't looking, we aren't listening, we aren't paying attention.

Three Roads to Relevancy
You can make your ads more relevant three different ways.

Make it about a product. Your store isn't that important. It's the products in your store that attract attention. If you sell widgets and your ad is all about widgets you will immediately attract the attention of all the people in the market for a widget.

Make it about a felt need. We all have felt needs such as the need for more money, security, prestige. When your message addresses that felt need it becomes relevant to all who share that feeling. If you are filling a specific need, speak to that need and your message becomes more relevant.

Make it about the customer. The most important person in your world is you. The most important person in your customer's world, however, is her. She isn't interested in hearing about you, but she loves to hear about herself. When you can tailor your message so that it puts the customer in the starring role, the relevancy of that ad skyrockets.

When you raise the Relevancy of your message, you get more people paying attention.

-Phil

Wednesday, September 22, 2010

Field of Dreams

"If you build it, he will come." -Shoeless Joe Jackson, Field of Dreams

Great movie. Bad advice for business.

Yet too many independents start out that way, thinking all they have to do is build a wonderful little shop and people will climb all over themselves to get in and give them money.

Roy H. Williams said, "If making a profit were easy, everyone would be doing it." But not everyone is making a profit. Those who aren't making a profit are closing their doors. And the first complaint out of their mouth is that they didn't get enough traffic, followed quickly by the blame...
  • The downtown doesn't have enough parking.
  • The Buy Local campaign didn't advertise me enough.
  • The city didn't support me.
  • The newspaper wouldn't write a story about our opening.
  • There just aren't enough people in the area.
  • No one knew about me because of the sign ordinance.
  • Unemployment is too high.
  • People are too cheap.
You know somebody who has made one of these statements. Heck, you probably have thought one or two of them.

Yet there are businesses thriving in hard-hit downtowns, thriving in high unemployment locales, thriving in spite of a lack of support from government, the newspaper, or a Buy Local campaign, thriving without coupons, discounts or cheap products.

You Have To Market Yourself
One of the biggest things they are doing differently is Marketing. Just building a store is not enough. We are over-retailed as it is. The most successful businesses are making a conscious choice to actively and creatively market themselves to the public. They are creating marketing messages, marketing plans, and mapping out new and unique ways to attract customers.

You Can Afford It
And it doesn't cost as much as you think. There are many ways to advertise your business spending primarily time, not money. You can learn seven of them by downloading my FREE eBook Main Street Marketing on a Shoestring Budget.

And if you have the money to spend, before you drop a dime get to know how the different advertising mediums work with two more FREE eBooks - How Ads Work Part 1 and How Ads Work Part 2.

The movie is wonderful. But it is just a movie. In real life the quote is:

If you Market it, they will come.

-Phil

Tuesday, September 21, 2010

Make Only One Point

Our attention spans are short. Our memory is faulty. Heck, I tell my staff that I am not responsible for anything they tell me. Write it down!

So how can we expect a customer to remember more than one point in any of our ads?

We can't. And they won't. So why bother?

Unclutter Your Ads
When you know exactly what your message is, make sure you don't clutter that message with other messages or information that is unnecessary. You don't have to include your exact address and phone in your ads. If you make your point powerful enough, they'll find you. You don't have to give your hours, unless they are the hours for the event you are marketing.

The reality is that the person receiving your message is likely to remember only one point at best. So the more points you try to make, the less likely she will remember any one of them, and the better the odds she'll remember the least important of those points.

Make Only One Point
Here is an example of a print ad that makes only one point. See how uncluttered it is? And if that point resonates with you, you'll remember that ad.

Another example is a bra shop called Bras That Fit. They advertise on the local sports radio program - yeah, advertising bras to guys. Their message?

"Hey guys, are you tired of hearing your wife complain about her bra not fitting? Send them to Bras That Fit to get the right size that makes them feel better."

They don't clutter their ad with their hours, or talk about swimsuits or other services they offer. It's all about getting a bra that fits so your wife won't complain.

You'd be surprised how many guys tell their wives where to go bra shopping.

Concentrate, Concentrate, Concentrate
Think of your marketing as a bottle of perfume. If you mix one perfume with another, you won't notice either (and the result might be toxic). You can add water to your perfume to stretch it out and make it last, but that just dilutes it until the scent is gone. Everyone knows that the more concentrated it is, the more powerful the scent, and the less you need to use.

Your ads are like that bottle of perfume. Keep your marketing concentrated on one message and more people will see it, hear it and remember it.

-Phil

Monday, September 20, 2010

Say Something Interesting

Your message is fine. But how you are delivering it needs some work. No one is getting it for one simple reason - you do not have their attention. Sure, you could yell and scream, but that doesn't really get you anywhere. We are bombarded with so many advertising messages that it is like trying to fill a teacup with a fire hose. But you can get your message safely into the cup as long as you remember to...

Make your message more interesting than whatever occupies your customer's brain at that moment.

You can do that by telling a story.

Stories are Interesting
We all love stories. They hook us in and get us to listen. Facts are boring and dull, but stories are interesting and fun. Whether you are doing traditional ads like radio, newsprint or TV, or just coming up with a way to get your message across in networking or social media, turn your message into a story.

Here is a copyrighted (meaning don't use it verbatim, copy the style, not the ad) example from Roy H. Williams' book Wizard of Ads (pg 28-29)
Announcer: You are standing in the snow five and one-half miles above sea level, gazing at the horizon hundreds of miles away. Life here is very simple. You live, or you die. No compromises, no whining, no second chances. This is a place constantly ravaged by wind and storm, where every ragged breath is an accomplishment. You stand on the uppermost pinnacle of the earth. This is the mountain they call Everest. Yesterday it was considered unbeatable. But that was yesterday.

Client:
As Edmund Hillary surveyed the horizon from the peak of Mount Everest, he monitored the time on a wristwatch that had been specifically designed to withstand the fury of the world's most angry mountain. Rolex believed Sir Edmund would conquer the mountain, and especially for him they created the Rolex Explorer.

Announcer:
In every life, there is a Mount Everest to be conquered. When you have conquered yours, you'll find your Rolex waiting patiently for you to come pick it up at Justice Jewelers, your official Rolex jeweler, on Highway 65 at Battlefield Road.

Client:
I'm Woody Justice, and I've got a Rolex for you.


Make Your Customer the Star
Not only does this ad tell a fabulous story, it stars the world's most important person - "you".

When you can tell a story and make the listener/reader the star of that story, they will listen and hear your message. They will become engaged with your brand. They will picture themselves doing exactly what you want them to do.

Here is another example of a story that speaks to the heart:
He left Detroit 9am Christmas Eve. Some store somewhere had to have the one toy his sweet little six-year old wanted. Six stores…seven hours later, he stood, travel-weary, across the counter from me. “I suppose you don’t have any Simon games either.” As I handed over the last of our Simon games he smiled and said, “God Bless You!” Believe me, He already has. Merry Christmas from the Toy House in Downtown Jackson. We’re here to make you smile.

This true story was from my first Christmas Eve as an official employee back in 1980. I was 14 years old and will never forget the look on that man's face. We banked an entire Christmas ad campaign on this story. Results? Best Christmas ever. Yet we never mentioned our hours, our address, or our services. But everyone got the message... Looking for a toy? Save the hassle and try us first.

Figure out how to tell the story of your message and you'll begin to see that message resonate a whole lot better.

-Phil

Sunday, September 19, 2010

Definition of Insanity?

Insanity is doing the same thing and expecting different results.

Never change your message, it is the key to your long term branding and growth.

Two truths. Yet, two seemingly opposite statements. How do we reconcile them? It would seem that if your advertising isn't working, then doing the same thing won't change that, therefore the message needs to be changed. But there is a flaw in that statement. Do you see it?

It isn't the message that needs to change, it is the way you deliver that message. You can only change two things in your message delivery:
  • The audience to whom you deliver the message
  • The strength with which you deliver the message
The first one is easy. Just switch mediums or stations, or papers, or magazines. I can promise you that there is an advertising salesperson who has "exactly the right people for your business". But you've already tried that and it didn't move the needle. You have bounced around from newspaper to TV to radio with the same lousy results.

A Stronger Delivery
That leaves you one option. Strengthen the delivery of your message. Your message is good, but the delivery is weak. Common mistake we all make. We water down our message in hope of not offending anyone.

But if you calculated your market share, you already know that 95% of the population are currently choosing to not shop with you. Who are you afraid of offending?

Messages are like magnets. The stronger they attract, the stronger they repel. In fact, your message's ability to attract new customers is in direct proportion to how much it repels others. You can't get everyone to shop at your store, so quit worrying about the people you repel and start thinking about who you want to attract.

Then make your message delivery so powerful that those you want to attract can't help but hear what you're saying.

Insanity is thinking you can attract anyone with a weak delivery of your message.

-Phil

Thursday, September 16, 2010

Don't Alienate Your Fans

At the Michigan Downtown Conference two speakers talked about sign ordinances. The first was Sheila Bashiri, City Planner from the city of Birmingham, MI, a well-to-do suburb of Detroit nestled in amongst the other wealthy suburbs.

Because Of or In Spite Of?
Birmingham has the most strict sign ordinance in Michigan, so strict that some of the slides Sheila showed us of attractive signage wouldn't even be allowed in her city. Yet many retailers want to be part of that bustling downtown. And Sheila claimed that her sign ordinance was a main reason for their success.

I guess the dense population of millionaires is only a secondary cause of the businesses thriving there.

The next speaker, Robert Gibbs, mentioned how much he liked the Birmingham sign ordinance and how all communities should adopt it for their business districts. In a private conversation afterwards, he went so far as to tell me that all existing businesses in those districts should be given 5 years to change their signs or move out.

Does he really believe Frankenmuth should tell Bronner's and their two million visitors a year to take down the billboards or get the f*** out? Or that Ann Arbor should give Zingerman's a remove the ugly trailer and all that neon outside the Roadhouse or else ultimatum? Hugely successful, yet eccentric retailers are what give our cities their character.

Businesses do not thrive because of sign ordinances. They thrive in spite of them because the city has the population base to support them and the stores are taking care of that population. Period. End of story. Sure, a well-crafted sign ordinance can give a city a uniform characteristic and look, but that does not draw traffic or grow business. The stores draw the traffic because of who they are and what they do. And signs are what help you find those stores.

It is no wonder that most downtowns are struggling. There is a huge disconnect between the city leaders/planners and the businesses that pay their taxes. Both of these speakers advocated not having businesses in the discussion for things like sign ordinances. Both believed that only city leaders should make decisions on what they want their business district to be.

A Business Lesson
That would be the same as you not listening to your customers. You wouldn't do that would you? Of course not! You will value some customers' opinions more than others. But if you aren't listening to your best customers, they won't be your best customers for long.

Don't make the mistake others are making. Listen to your best customers. Include them in your plans. Not only will you make better plans because of it, you'll empower those same customers to become evangelists for your business. By giving them a say in the matter, they will be your strongest advocates, and give you incredible word-of-mouth exposure.

Not everyone has an unlimited supply of millionaires. Take care of those who are taking care of you. That's a lesson for retailers and for cities.

-Phil

Wednesday, September 15, 2010

How Long is Your Shoestring?

The term "Shoestring Budget" dates back far enough that no one really knows who or how it got started. Some say it's because shoestrings are so low to the ground and your budget is really low. Some say it's because shoestrings are so cheap that they're all you can afford. Some say it's because broken shoelaces were used to tie together all your other belongings, meager that they were. One theory I liked was in reference to shoestring gamblers, gamblers without a lot of money who played low stakes games.

Regardless of it's origin, most independent retailers have a Shoestring Budget when it comes to your marketing. And most of your marketing is a gamble, spending X hoping to get Y in return.

On Monday I did a presentation at the Michigan Downtown Conference called Main Street Marketing on a Shoestring Budget.

The notes for that presentation are now downloadable in the Freebies section of www.PhilsForum.com.

Those of you who want to learn the truth behind Word-of-Mouth Advertising, how to use Social Media properly, or would like a way to turn all those requests for donations into actual business for your store will download this document.

Those of you who want to learn an easy way to turn your customers into fans, a simple way to draw traffic at only $2.50 per new customer (guaranteed), or want to learn how to meet people that can make a difference in your business will download this document.

Those of you who want to learn two techniques that will strengthen all the businesses on your Main Street at once will download this document.

The rest of you can continue to gamble with your shoestrings. But I'm betting that a lot of you are going to download this document and pass it along to your friends (strongly encouraged).

Did I tell you it's FREE?

-Phil

Tuesday, September 14, 2010

New Statistics on Market Share

I just got back from presenting at the Michigan Downtown Conference in Bay City, MI. Robert Gibbs offered some new statistics on the breakdown of Retail Market Share worth passing along.

In 1955 the Central Business Districts of our cities had 90% of the Retail Market Share. Today the CBD's have 2%.

The breakdown looks like this:

Power Retail Centers (think Wal-Mart plazas) 37%
Regional Shopping Centers (malls) 31%
Internet 9%
Living Centers (the new outdoor mall type places) 7%
Downtown CBD's 2%

(I am guessing that the other 14% is in small strip malls and stand-alones that are spread out along the highways, rural areas and non-commercial districts of this fine country.)

That is a major shift in shopping habits. His solution for downtowns to reverse this trend is for downtowns to attract more chain retailers. The chains then become anchors that attract shoppers and raise the tide for all the shops. Unfortunately, that is not a reality for most small cities.

Especially after he told us the 50-50-50 rule for attracting chain stores. You have to have two of these three factors:
  • 50,000 people in the trade area (or more)
  • $50,000 average income (or higher)
  • 50,000 cars driving by daily (or more)
How does your community stack up? I am guessing that 95% of the cities in the US were eliminated immediately.

My solution is far simpler and works whether you're in a bustling metropolis or quaint little town.

To gain back market share you need to be better than you were in marketing, better than you were in over-the-top incredible customer service, and better than you were in turning your customers into evangelists. Do that and the people will come. You don't need a national chain store to draw you a crowd. Start your own crowd - a crowd of people who love you.

-Phil

Friday, September 10, 2010

How Much Market Share Should You Have?

I showed you how to calculate your Market Share. Hopefully you did that. It's a real eye-opener when you see how much (or little) of your market you actually own.

Your first thought was to wish it was higher. But how high is realistic? It depends on a few factors, some of which you have no control.

The Factors
Competition is your biggest factor. How many other stores are in your industry? How well do they do their job? How much crossover of product is there? How well do you do your job? How much marketing do they do? How much marketing do you do?

In my market of roughly 160,000 people we have a Toys R Us (plus the new pop-up TRU Express store), Wal-Mart, Target, 2 K-Marts, and 2 Meijer's. At Christmas time we also have to deal with the toy departments at Sears, Kohl's and JC Penney. That's a lot of competition for a shrinking piece of pie.

Fortunately for us, while they all spend enormous amounts on advertising, almost all of it goes towards the Transactional Customer. And most of our product selection cannot be found in their stores. Customer Service? Ours is much better (or at least it better be:-).

Not a Level Playing Field
But as an independent store most of us have an uphill battle in the market share game.

First, only about 9% of the population (heard this multiple times but still looking for source for this stat) are pre-positioned to shop at an independent retail store.

Second, most independents are far below the big chains in name recognition. Not surprising considering the huge ad dollars these chains can spend.

Third, independent stores are perceived as having higher prices and lower selections. Whether true or not, this perception is the reality in the public's mind.

Therefore, a typical independent store is likely to have only 4-6% share of the market. If you are above that, you're doing things right. If you are above 10% then you are really on the right track because you have convinced people not predetermined to shop local to still shop with you. And if you are over 15%, you rock!

Roy H. Williams likes to point out that 30% is the gold standard for any one business in any one market. If you have 30% of the market, you own that market. Just don't expect to grow much more. Even Wal-Mart only has 10% of the retail market, and is lucky to top 20% in any category. Sure, some Wal-Marts have that mythical 30% in certain markets, but mainly because they are the only game in town.

Where to Go From Here
But as an independent retailer, if you have 15%, it will take some nifty circumstances to grow much higher. And the higher you go, the tougher the battle. Once you have reached a high point in your market in one category, the only way to grow is add a new category.

That is what I am doing right now - researching new categories for my store. Although we will still go after higher market share in the current categories, our market potential is shrinking. So adding new categories gives me the best opportunity to grow our business.

And how will I pick which categories to enter? You guessed it - by calculating the Market Potential and seeing if 5% of that market is worth my time and resources. I am currently evaluating Teacher Supplies, Crafts, Juvenile Furniture and others to see which has the most potential, the fewest competitors, the best opportunity to jump in and take a piece of the pie.

Without knowing how to calculate Market Potential, this exercise is futile. But armed with that knowledge, I know we'll pick the best way to be successful.

Make sense?

-Phil

Wednesday, September 8, 2010

Is it Interesting? Cool? Useful?

You should ask that question about every product you sell.

If it isn't at least one of those, preferably two or three, then why do you have it? I'm pretty sure that unless someone thinks a product is interesting, cool and useful, you aren't going to sell a whole lot of them.

Interesting gets their attention.
Cool makes them pleased they looked.
Useful compels them to buy.

I'm asking you the same questions about this blog. At the bottom of each post you'll see a place where you can check Interesting, Cool, and Useful. Please tell me what you think (check all that apply). Feedback is always appreciated.

Thanks,

-Phil

Tuesday, September 7, 2010

Growing Your Market Share

Toys R Us has opened an Express store in our mall.

They already have a full service store in our other mall (2 miles away). They are hoping to grow their Market Share with this pop-up store (here today, gone December 26th).

Calculating Market Potential
Do you know your Market Share? Here is an easy way to find out.
  1. Find the total dollars spent in the US in your industry for 2009 (toys = $21.5 billion)
  2. Divide that by the population of the US (308.5 million)
  3. Multiply that number ($69.69) times your market's population
The answer is your Market Potential - how much total business is done in your industry in your market. Divide your Gross Sales by the Market Potential and you'll have your Market Share.

Knowing this makes a huge difference in how you go about your business.

How Many Customers Equals Growth?
If you have a relatively small market share (less than 5%), it doesn't take a whole lot of new customers to grow your business. Just convincing 1% of the market to switch to you gives you 20% growth! Wouldn't that knowledge change the way you advertise?

Knowing how to do this calculation also helps you see the trend in your market. Is it growing or shrinking?

In the case of toys, it is shrinking. Back in 2004 the sales per person was $75.17. In 2009 it was only $69.69. Plus, in my case, the population is shrinking, too. My market potential has dropped almost 10% in the past 6 years (not adjusted for inflation which makes it even worse) because we have a shrinking toy industry and a shrinking population base - double whammy.

So just to keep sales equal to last year I need to steal business from my competitors and grow my market share. That's a hard task for any retailer, and part of the reason why Toys R Us is opening a second location in a small market. They are trying anything they can to grow their market share.

Market Share at What Expense?
But before you say, "Hey, what a great idea. I'm going to open a pop-up store!" you need to understand the ramifications of their actions. Yes, they will probably gain some market share. The mall in which they put the pop-up is next to a Wal-Mart, but doesn't have any other toy retailers.

But the costs will be extensive. They will have rent and payroll at the new place on top of the rent and payroll at the main store. And the two stores are so close that a large portion of their sales in the new location will be lost sales at the main spot. In effect, the biggest market share they will steal is from themselves.

Pros and Cons of the Pop-up Model
If you are thinking about a pop-up store you have to weigh the pros and cons.
The pros:
  • Only paying rent for the busiest months of the year when sales are enough to pay those bills.
  • Getting exposure and sales in new geographic areas
  • Having built-in traffic (mall-generated) instead of having to advertise
The cons:
  • Increased rent and payroll (decreased profit?)
  • Increased headache of keeping inventory straight and stocked between two locations
  • Potential of cannibalizing your own market share
  • Could damage brand reputation with smaller selection, less-trained staff
Only you can weigh those options and know if it is the right decision for you. But if your market potential is shrinking, it might be the best way to grow your share of that shrinking pie. My guess is Toys R Us doesn't care as much about expenses and profit as they do market share - a number they know all too well. That's the number that makes headlines for them.

When you know your Market Share you are better prepared to make those decisions.

-Phil

PS In the next post I'll tell you my plans for dealing with our shrinking Market Potential.

Saturday, September 4, 2010

To Labor on Labor Day or Not

Are you open this Monday? We aren't.

Labor Day & Memorial Day are paid holidays for my staff (along with New Year's Day, Easter, 4th of July, Thanksgiving and Christmas).

We're also closed Sundays of Labor & Memorial Day weekends.

Why?

For my staff. They deserve a break. I expect a lot from them and so I need to reward them from time to time. Giving them paid holidays and long weekends is one way I tell them that breaks are important and family time is a priority and that it isn't always about chasing the almighty dollar.

Plus, in our town it just isn't a big shopping day for anyone but the Transactional Customers looking for a Labor Day sale. And I'm not going after them.

You may have your own reasons for being open or closed this weekend. That's fine and good by me. Just thought I'd tell you mine.

Happy Labor Day! (wanted to tell you that now, because Monday I'll be sleeping in:-)

-Phil

Friday, September 3, 2010

Completing the Sale

Rick Segel's last post was on how to raise your average ticket by selling more. His suggestion? Suggestions (read his post here).

Of course, rather than tell you what to do, he invites you to attend his webinar to learn how.

With all due respect to Rick, I don't want you to attend any webinars, so let me tell you how I taught my staff to do suggestive selling. (Hint... it's not a whole lot different than, "Want fries with that?", but then again it is completely different.)

Complete the Sale
Every customer that is making a purchase has an expectation of using that item in one way or another. But most often the item is not a stand-alone item. Most often there are accessories either optional or required that make using the item much more productive and/or enjoyable.

A radio-controlled helicopter needs batteries. A model car needs paint & glue. A coloring book needs crayons. A dress shirt needs a tie. A pair of shoes needs socks. A new car needs fuzzy dice.

Yeah, that's the low hanging fruit. But every product has something that completes it, often many options to complete it.

Teachable Moment
To get my staff to understand this concept we started with our usual show-and-tell. Everyone grabbed one new item from their department to show off to the rest of the staff at one of our meetings.

But then I challenged them. I asked them to go back into the store and find five items that they could suggest to a customer to "complete the sale". Not surprisingly, they were all able to easily find five items. Some came back with ten.

The point made was that with every item there are plenty of suggestions of complimentary products, some of which they need, some of which they might just want. But unless you are conditioned to think that way, unless your staff is already mentally thinking in those terms, just making random suggestions is as effective as selling french fries.

-Phil

Thursday, September 2, 2010

Chapter 2 The Lunch

Another excerpt from the book "Hiring and the Potter's Wheel: Turning Your Staff Into a Work of Art"... Read previous excerpts here and here.

Chapter 2 The Lunch
“Just as our eyes need light in order to see, our minds need ideas in order to conceive.” – Napoleon Hill

Thursday arrived and Mary breezed into work. But even then, the minutes ticked off slowly as Mary anticipated her luncheon meeting. Finally, at 11:30, Mary grabbed her coat and headed out the door. It was only three blocks from her office to the deli. With the sun shining, Mary walked briskly down the street, her enthusiasm putting a bounce in each step. As Mary grabbed the door handle, she noticed Dr. Scott a half block away. Mary waited.

“Thank you so much for meeting me. I am so grateful,” Mary blurted out.

“Oh no, the pleasure is all mine,” Dr. Scott responded with a grin as they entered the deli. “Shall we sit?”

Dr. Scott led her to a table near the back where it would be quiet enough to talk. A waitress took their drink order as Mary stared at her former professor, not sure where to begin. This was a different side of him that Mary had not seen as a student. Dr. Scott motioned to the menus tucked away between the salt & pepper shakers. “Order first, then we’ll talk. If we don’t order now, we’ll get hammered by the rush.”

As Mary scanned the menu, she could see the tables beginning to fill up. They both ordered quickly, and settled in to wait for their meals.

“As I recall,” Dr. Scott started, “you were always one with an open mind. No matter how many times I challenged you to do better, you did. So it was funny you would call the day you did. I was opening my mail when the phone rang and had just received an invitation to the best human resources training program ever. It’s in the evenings, right during my HR308 class. Believe me, this program would be perfect for you. It meets twice a week at the downtown YMCA and runs for five weeks.

“I know, I know, before you protest about not having time, trust me. You’ll be able to start applying the lessons immediately. And anyway, it’s too late to worry about all that. I’ve already signed you up. Here’s the brochure.”

Dr. Scott slid a simple tri-fold brochure, black ink on white paper, over to Mary.

Mary was confused. “The ‘best human resources training program’ came on a simple black and white brochure in a class down at the Y?” Mary thought to herself. Mary took the brochure from Dr. Scott and read the front of the flyer. Now Mary was even more confused.
“Pottery?! Dr. Scott, this must be a mistake. I think you’ve given me the wrong brochure,” Mary said indignantly.

Dr. Scott pulled back the brochure, peered at it though his bifocals. “No, it’s the right one,” he replied as he slid it back across the table. “Trust me, Mary. Use that wonderfully open mind of yours. The class starts this Monday and you’re signed up. But I’ll tell you what. Go to that first class Monday night, and I’ll meet you here Tuesday for lunch. If you haven’t learned anything new, we’ll figure out something else. You have my word on it.”

Before Mary could respond, the waitress brought their food. And Mary could tell by the way Dr. Scott dug into his ham & Swiss that further discussion was out of the question.

As Mary walked back to the office, she grappled with the idea of how taking a pottery class could teach her to find, hire and train twenty great sales reps. No answers came and even the sunshine could not force its way into her furrowed brow. “Pottery?” she continued to question.


Here are more testimonials for the book...

"What a wonderful book! I will certainly be recommending it to a few people. I like the analogy used with the pottery class in the story to develop a step-by-step best practice for finding, interviewing, hiring and training new employees. The story really made for a quick, relaxing read but with a remarkable number of “take-aways” to apply back on the job. It is, frankly, one of the better business books I have read (and I have read quite a number!) because in a short time you walk away with tips to use immediately." - Gina Abudi, MBA - Partner/VP Strategic Solutions

"Phil, Your book was excellent. I really liked the digestible size. That's perfect for managers who don't have the patience to trudge through a lengthy dissertation. They could basically read it during a lunch break. The story was very engaging and fun. It kept my attention throughout. I loved the short chapters and the quotes, they really spoke to me. One of my favorites was "Pleasure in the job puts perfection in the work." That is so true, and I wish more managers understood that. There's so much focus on quality and checklists and process to get things right, but if you gave someone something they'd be excited to do, then they'll do the best they can. Thanks for creating and sharing your own work of art. This will be an excellent resource." -Rex Williams - Grootship


Buy your copy of the book here and transform your staff into the masterpiece you want them to be.

-Phil