I really love the Andertoons - very smart insights simply told.
This week we have a cracker of MUST READS for you from all around the net...
- The three Cs of customer satisfaction by the always insightful team at McKinsey's
- A Facebook story that illustrates karma beautifully - especially if you are entrepreneur...
- The biggest CON of all time - is just what I think. (I write elsewhere when it is off-topic for Ganador.)
- 10 Lessons for Lifetime Success from an Accidental Businessman
- How many publicly traded companies with a market capitalization of at least US$1 billion grew by 5% each year for five years – AND HOW DID THEY DO IT?
PS: Made some changes on the website and added some new stuff. Come for a visit...
Good retailers execute these fundamentals well. There is of course always an exception to each ‘rule’, but they are not as common as you think. It is tempting to dismiss something as theory because one disagrees with it, but for every person who denies the validity of these fundamentals there are hundreds of successful retailers who simply just get on with doing it.
1. Staff are critical to your success:
o Teach them to serve well
o Use them to sell actively
o Reward them effectively
o Control your expenses with good rosters and productive staff, not stingy pay scales
2. Use your own time to add value and manage – not only to serve behind the counter. (Take regular mini-breaks if you can’t take proper leave. Your customers will love you for it.)
3. Focus your core product range so that you:
o Become an expert
}o Develop bargaining power with suppliers
o Become known as the ‘go to place’ for… something
4. Stocktake annually at least (even a rolling stocktake) – no exception
5. Buy your stock to a Budget (OTB)
6. Consolidate price points (avoid price point proliferation) for each sub-category: Best, Value, Average, Good, Premium
7. Never discount unless a product falls below the benchmark stockturn rate
8. There are over 20 different types of price reductions you can negotiate with your suppliers – fight hard for your business
9. Doing the same old will get the same old results – be brave, be different
10. If it works, don’t change because you are tired of it
11. Use your suppliers and work with their calendars and resources for marketing activities
12. Community engagement should be at the core of your activities – and the sales will follow
13. Good displays sell silently: visual merchandising matters
14. Be smart with product/category locations
o Be consistent for customer convenience – but don’t be afraid to experiment
o Convenience products in convenient locations
o Destination products in destination locations
o Promotional and high-margin products for the dance-floor
15. Even the dirtiest, poorest, most ignorant customer does not love a dirty store – they will leave as soon as there is an alternative
16. Your fitout should be SUBSTANTIALLY be refreshed every SEVEN years. And NOTHING should be allowed to be older than TEN years.
17. Allocate product space proportional to their Gross Margin contribution as far as practicable.
18. Reduce non-selling space to <15% of GLA (sub-let if you can or innovate a new use)
19. Target a benchmark floor space productivity (in shopping centres, for example aim for more than $8000/sqm based on annual sales)
20. Systematise everything to minimise errors and risk. From opening and closing hours though to how you cash up.
21. Pay your bills on time then you can demand the same respect.
22. Communicate when you have issues – ask for assistance from anybody and everybody and NEVER stop learning. (There is a big difference between TWENTY years’ experience and ONE years’ experience twenty times over.)
23. Don’t worry about the competition – do your own thing and do it well
24. Make sure your system (POS/Database) is 100% current and that you can make accurate, meaningful decisions about your agency.
25. Measure all the metrics that matter and make decisions accordingly
Of course there are a few more and we look forward to hearing from readers what they may want to add to the list. But in summary, there is a final, over-arching rule that applies.
MOST RETAILERS ALREADY KNOW WHAT NEEDS TO BE DONE.
But for reasons that escape me entirely, too few actually do it.
Dennis can be reached on firstname.lastname@example.org with any questions on any of these topics.
If you cannot see the video, please visit the blog posting on the site and watch it. You may have to save it for the weekend - but is fascinating insight into the old and new of advertising.
It is an HOUR - but well-spent. Stop what you are doing and do this...
Of course we do the face to face thing. But as you know, technology is part of every business if they want to have a future-proof business model.
In our case it is SMARTCLOUD.
We constantly craft the message and the brand and the image, and how to best visually represent it.
The PRODUCT itself can be visually explained as per this image.
What I need your assistance with is our new business cards.
I am thinking of using some GAPINGVOID art for the back of the business cards.
I am tossing up between the following two:
(Hah – see what I did there… a bit of innovation testing. C’mon talk to me…)
PS: Let me know what you think about SmartCloud too...
If you are easily offended, this one is for you...
If you aren't easily offended, this one is for you.
Remember - it is a JOKE :)
There is something for everyone in this little list of internet goodies...
- The things I have learned (some of it anyway)
- As privacy is eroded, tools emerge to circumvent that
- 3 Reasons why you will never be successful
- 8 Things The Most Successful People Do That Make Them Great
- 7 Things really persuasive people do
- When You Fall in Love, This Is What Facebook Sees
ENJOY! (And share the love.)
I am not a huge fan of markets – not any more than the average Joe at least. I don’t pretend to have more knowledge about markets than the next bloke. But I do understand retail and I really understand consumer behaviour. But more importantly, I have enough common sense judge good and bad business practices when I see it.
This post is not a critique on market stall operators because many of them are hobbyists ands should probably not be judged against professional standards. (Although having said that, even an amateur photographer will try to take the best photo they can and not hide behind their amateur status.)
Observation # 1
A customer is looking at the shoes that (for some reason) were laid out flat on the grass. The operator made a sales pitch, but the customer did not engage, but did not walk away either. After a moment the operator says: “I am going step away and I will be at the back if you need me.” He then proceeds to step away – all of 2 meters (it is a stall after all).
Very smart. People like to buy, but don’t like feeling ‘sold to’. By SAYING what they were going to do and THEN doing it, they do more than simply give the customer space. They actually communicate a level of psychological consistency – the sub text being that I am as good as my word.
Observation # 2
Some operators do and some don’t wear your own product.
You are your own best advertisement. A big, fat dude can’t credibly sell diet products. If you sell art then you must look the part. Wear your own product.
Observation # 3
There was an operator that built some jewellery that contained plants – sort of a ‘garden in a necklace’ – like a ship in a bottle, but on a miniature scale.
In a sea of junk, something different and innovative always stands out.
Observation # 4
One clothing stall had a sign that communicated: “Fashion at market prices.”
It may seem redundant because both the fashion and the market aspects were obvious. But telling a customer what to expect when that is exactly what they expect is never redundant.
Observation # 5
The candle retailer had a nifty tactic to help customers smell more candles. She offered them coffee beans to chew – which apparently clears the nose sufficiently to allow customers to keep smelling when the variety of aromas could become overwhelming.
Knowing your product and understanding what the customer is actually buying (not just the look of the candle) is important and finding practical things to make that easier for the customer is hugely valuable.
Observation # 6
One stall had a price point sign that read: “Price’s as marked”
I know you are not a professional, but really? You can’t spell ‘prices’? I googled the phrase "price's as marked" in quotation marks. Can you guess how many results I found? Exactly 4. I did not realise it was possible to search for something that gave so few results. If the billion people on the internet can get it right, sure you can.
Observation # 7
One stall holder was selling (handmade) dog leashes. But no dog in sight anywhere.
In an open air market like that dogs are permitted and there are a few around. Most dogs that are taken into these environments are relatively trained not to attack other dogs on sight, but even so that would be a relatively minor hassle.
The alternative is I walk past your stall and I see a table with colourful ropes on it.
Observation # 8
Some stallholders have EFTPOS tap-and-go while others still rely on theold-fashioned bumbag.
Do you really need to give a customer a reason not to buy?
Observation # 9
No sample jerky at the jerky stand.
Good luck with selling that.
Observation # 10
I observed the quietest stalls were the ones where the owners were sitting down on a char at the back of the gazebo.
Is this the cause or effect? I would hazard a guess that customers are thinking if you are not very interested in your product there is no reason for them to be.
Observation # 11
Customer approaches the table and touches product (a plush toy). The owner announces from the behind the laden table “That one is $15 “
The first thing surely isn’t what it is going to cost but what you are going to get? If the operator said “they smell really good too” the customer would probably have lifted the product towards their face to smell. Picking up the product is already one step closer than simply touching it.
Observation # 12
While selling some organic bathroom/beauty product – owner announces that he is really 167 years old. The customer laughed.
Rule #1 of getting a customer to buy is to get them to relax. Humour is an effective tool in doing so – if you can pull it off.
Observation # 13
The pickle stand showed their certificates form the Sydney show
The credibility that comes from an ‘official endorsement’ should not be underestimated.
Observation # 14
I observed one owner juggling sticks to entertain himself while waiting for customers to his herbs and spices stand.
It wasn’t entertainment aimed at the customers. It had no relevance to his product. He clearly showed his disengagement in a way that is possibly worse than the operator sitting down at the back of the stand because customers would not want to interrupt someone who is ‘doing something’.
Observation # 15
AT the stand selling clocks, not a single one had the correct time, neither have they been set to 10 past 10 as is the custom to display the ‘happy face’.
If not showing your product in a positive light (by wearing it or demonstrating it) is a crime, then showing it to prospective customers in a ’broken’ state is even worse.
The most important point about all of the above is that NONE OF THESE would cost money and can easily be applied by any operator. These little things can often make the difference between a good and great business.
None of the stall holders actively and prominently directed customers and/or passerby to their website and not one tried to collect a name for a subscription list. There were a few websites listed on labels but nothing significant. I would consider that to be a major missed opportunity.
It may seem like a silly question, right?
I guess you know that it is at 212°F or 99.98°C (lets’ call it 100, OK – and we agree this is at sea level?)
It takes a certain amount of time and energy to get water to boil.
How hard is it (what does it take) to get water to or 99°C or 211°F?
Very close to the same amount of effort, energy and time than it does to get it to boiling point.
BUT – if it doesn’t boil it doesn’t boil.
If it does not boil it does change. You have warm water, not boiling water.
It won’t become steam.
It does not transform.
All that effort and energy for nothing.
It is the same for your business. It may only need another 1 degree increase in temperature to be transformed.
(HT to Wayne Mullins for the idea of this post.)
In to 1865, Rudolf Clausius coined the term "entropy" and stated that the entropy of the universe tends to a maximum. This idea is now known as the second law of thermodynamics and a measure of the "disorder" of the physical system.
Consider the behaviour of gas in a closed box. If you start with all the gas molecules in a corner of the box, the gas molecules will fill the box, increasing the entropy (tending to ‘chaos’ or disorder.)
Interestingly it never goes the other way: if the gas molecules fill the box, we will never see them spontaneously collect into one corner. (This one-way behaviour of matter is called the "arrow of time and is related to notion of ‘the arrow of time’ which I wrote about here.)
This is not just a phenomenon and it is not just a theory – this is one of the LAWS of the universe. (If you are interested in that sort of thing, you will know that this Law is not reconcilable with the idea of the spontaneous creation of the universe.)
Since the Second Law of Thermodynamics (systems tend towards chaos) is a universal law, then it also applies to all systems – including the system of your company.
As organisations grow (older and bigger) the natural law is that it will tend to towards disorder (entropy).
General observation of organisations and their natural lifecycles would tend to support that.
Of course your survival and your prosperity therefore depends on how well you can delay (fight) that natural tendency.
The tools to achieve this are:
Passion, energy, motivation et al may be the common prescription by ‘success gurus’, but the reality seems to be more mundane than that. If you searched online for ‘why following your passion is bad advice’, and you will find several arguments for and against.
In fact, MOTIVATION refers to internal (emotive) states whereas PASSION AND ENERGY reflect actions (behaviours). Emotions and feelings wax and wane, whereas action is something that can happen independently from emotions. Any entrepreneur will be able to relate stories of how they rocked up for work despite feeling miserable.
The only way to postpone entropy is to work at it. NO matter how you feel.
The weekly roundup of stuff you shouldn't have missed...
- Top 10 Innovators in Retail. For what it is worth, by the time they get on a ‘list’, it is too late to copy them if you really want to be an innovator.
- A really insightful take on some key paradigm shifts. 3 Foundational Marketing Shifts and How B2B Marketers Can Benefit
- Isaac Asimov Predicts in 1964 What the World Will Look Like Today — in 2014
- As I keep telling my clients… and now HBR revisits that thorny question:The First Strategic Question Every Business Must Ask