Thursday, October 18, 2007
It seems like we make lists for everything these days. Groceries, Errands, Christmas presents. But for our businesses, do we make ENOUGH lists? Especially those that can help us save money? I suggest not.
But it's not too late. With just 75 days before Christmas, and lots of advertising still to be done, I offer you a checklist to make your advertising be the most effective it can be.
Use it to save your store money- this holiday season and beyond.
Here are some guidelines for creating memorable advertising that really sells:
1) Make sure your ads are "on strategy" with your business positioning. A good positioning strategy ensures identification of the correct target audience for your advertising, along with a listing of meaningful features and benefits. It can provide reasons why the product is superior and unique, along with an advertising "personality."
Key to success: Communicate a simple, single message. People have trouble remembering someone's name, let alone a complicated ad message. Use the "KISS" principle for ad messages: "Keep It Simple, Simon." For print ads, the simpler the headline, the better. And every other ad element should support the headline message, whether that message is "price," "selection," "quality," or any other single-minded concept.
2) Stick with a likable style. Ads have personality and style. Find a likable style and personality and stay with it for at least a year or more of ads. Changing ad styles and personality too often will confuse potential buyers. It also fights against memorability.
Key to success: Be credible. If you say your quality or value is the "best" and it is clearly not, advertising will speed your demise, not increase your business. Identifying and denigrating the competition should also be avoided. It is potentially confusing and distracting and may backfire on you by making buyers more loyal to competitive products, not less.
3) Ask for the sale. Invite buyers to come to your store, send for more information, or call for information and orders in the ad. Provide easily visible information in the ad for potential customers to buy: location, telephone number, store hours, charge cards accepted, etc.
Key to success: Make sure the ad is competitive. Do your homework. Examine competitive ads in the media that you are planning to advertise in. Make sure your ad stands out from competitive ads. Compare ads for uniqueness, memorability, credibility, and incentive to purchase.
4) Make sure the ad looks professional. If you have the time and talent, computer graphics and desktop publishing software can provide professional-looking templates to create good-looking print ads. Consider obtaining writing, artistic, and graphics help from local agencies or art studios who have experienced professionals on staff, with expensive and creative computer software in-house. They may save you time and money in the long run, with better results.
Key to success: Looks matter. The professional image you portray in your advertising will go a long way in getting your customers to the door.
5) Be truthful. Whatever advertising medium you select, make sure your message is ethical and truthful. There are stringent laws regarding deceptive practices and false advertising.
Key to success: If you don't believe in what you are saying, neither will your potential customers.
Shift Your Sales Focus for Increased Sales
Want to increase sales dramatically? Then shift your sales focus from attracting new customers to enticing your proven customers to buy again. The best sales prospect is a prospect that’s already converted – in other words, one of your current customers.
Think of it this way; if your business is located in a small town with a population of 1000 people and you sell a sprocket to everyone in that town, man, woman, and child, you’ve sold 1000 sprockets – and saturated your market. Your sprocket selling days are over. Is it time to pack up and move on?
No! If you start focusing your sales efforts on your proven customers, you’ll be able to increase your sprocket sales dramatically. And these sure ways to increase sales will help build customer loyalty, too. Try some or all of these ideas to increase your sales:
1. Set up a sales incentive program.
Give your sales staff a reason to get out there and sell, sell, sell. Why do so many businesses that rely on their sales staff to drive sales have incentive programs in place? Because offering their sales staff the trips and/or TVs for x amount of sales works.
2. Encourage your sales staff to upsell.
Essentially, upselling involves adding related products and/or services to your line and making it convenient and necessary for customer to buy them. Just placing more products near your usual products isn’t going to increase your sales much. To upsell successfully, the customer has to be persuaded of the benefit. For instance, when I last had my carpets cleaned, the cleaner noticed a pet stain. Instead of just cleaning it up, he drew my attention to it, and showed me how easily and effectively the spot cleaning solution removed all trace of the stain. Did I buy the spot cleaning solution? You bet. He persuaded me that buying it was beneficial to me and made it convenient to purchase it. Result: increased sales for the carpet cleaning company.
3. Give your customers the inside scoop.
Recently I was shopping at a retail housewares store. I had picked out an item and was mulling over whether to buy it or not when a salesperson came up to me and said, “I see you’re interested in that blender. We’re having a sale next week and all our blenders will be 20 percent off. You might want to come back then.” Guess what? I did – and bought two other items as well. Lesson: if you have a promotion or sale coming up, tell your customers about it. They’ll come back – and probably bring some friends with them too. (And don't forget - you can give your customers the inside scoop by emailing or calling them, too.)
4. Tier your customers.
There should be a clear and obvious difference between regular customers and other customers – a difference that your regular customers perceive as showing that you value them. How can you expect customer loyalty if all customers are treated as “someone off the street”? There are all kinds of ways that you can show your regular customers that you value them, from small things such as greeting them by name through larger benefits such as giving regulars extended credit or discounts.
5. Set up a customer rewards program.
We’re all familiar with the customer rewards programs that so many large businesses have in place. But there’s no reason that a small business can’t have a customer rewards program, too. It can be as simple as a discount on a customer’s birthday or as complex as a points system that earns various rewards such as discounts on merchandise. Done right, rewards programs can really help build customer loyalty and increase sales.
6. Distribute free samples to customers.
Why do so many businesses include free samples of other products when you buy something from them? Because it can increase sales in so many ways. As the customer who bought the original product, I might try and like the sample of the new product and buy some of it, too. Or I might pass on the sample to someone else, who might try the product, like it, and buy that and other products from the company. At the very least, the original customer will be thinking warm thoughts about your company, and hopefully telling other people about your products.
Attracting new customers is a good thing. But attracting new customers is not the only way to increase your sales, and is, in fact, the hard way of going about it. Shifting your sales focus to enticing your current customers can make increasing your sales easier – and best of all, build the customer loyalty that results in repeat sales.
Wednesday, October 17, 2007
In reality, our focus should be on the top 20 percent of our clients who are currently our best customers. Once we have satisfied their need, we can focus on two other important customer groups to help grow our business. Read on to find out which types can mean the most to our bottom line.
Let's start by breaking down shoppers into five main types:
Loyal Customers: They represent no more than 20 percent of our customer base, but make up more than 50 percent of our sales.
Discount Customers: They shop our stores frequently, but make their decisions based on the size of our markdowns.
Impulse Customers: They do not have buying a particular item at the top of their “To Do” list, but come into the store on a whim. They will purchase what seems good at the time.
Need-Based Customers: They have a specific intention to buy a particular type of item.
Wandering Customers: They have no specific need or desire in mind when they come into the store. Rather, they want a sense of experience and/or community.
Now that we know who our customers are, let's focus on what we can do as merchants to drive sales in each category.
Communication is KEY. Contact these customers on a regular basis by telephone, mail, email, etc. These people are the ones who can and should influence our buying and merchandising decisions. Nothing will make a Loyal Customer feel better than soliciting their input and showing them how much you value it. For this group, one mantra delivers above all others: You can never do enough for them! Many times, the more you do for them, the more they will recommend you to others.
This category helps ensure your inventory is turning over and, as a result, it is a key contributor to cash flow. This same group, however, can often wind up costing you money because they are more inclined to return product. Contact them when necessary, and look to convert them into regular loyal shoppers, but don't give the house away in trying to do so.
This is the segment of our clientele that we all like to serve. There is nothing more exciting than assisting an Impulse shopper and having them respond favorably to our recommendations. Focus on merchandising the store to meet their needs. Easy to navigate displays, informational signs, informative sales people will all help to convert this impulsive shopper into a returning loyal cusotmer. Bonus: Continually probe this group about their needs and wants. It can be a great place to get new insights into consumer trends and changes in your market demographics.
People in this category are driven by a specific need. When they enter the store, they will look to see if they can have that need filled quickly. If not, they will leave right away. They buy for a variety of reasons such as a specific occasion, a specific need, or an absolute price point. As difficult as it can be to satisfy these people, they can also become Loyal Customers if they are well taken care of. Salespeople may not find them to be a lot of fun to serve, but, in the end, they can often represent your greatest source of long-term growth.
It is important to remember that Need-Based Customers can easily be lost to Internet sales or a different retailer. Positive personal interaction is required to stop this from happening. Send in your top salespeople when you see these shoppers lurking! If they are treated to a level of service not available from the Web or another retail location, there is a very strong chance of making them Loyal Customers. Need-Based Customers offer the greatest long-term potential, surpassing even the Impulse segment.
For many stores, this is the largest segment in terms of traffic, while, at the same time, they make up the smallest percentage of sales. There is not a whole lot you can do about this group because the number of Wanderers you have is driven more by your store location than anything else. Attractive window displays, creative street side marketing tools and advertising ideas can help drive more wanderers to your store.
Keep in mind, however, that although they may not represent a large percentage of your immediate sales, they are a real voice for you in the community. Wanderers genererally shop for the interaction and experience. Shopping is no different to them than it is for another person to go to the gym on a regular basis. Since they are merely looking for interaction, they are also very likely to communicate to others the experience they had in the store. One tip: Manage your time with the wanderer-they can be a time killer!
Retail is an art, backed up by science. The science is the information we have from financials to research data (the "backroom stuff"). The art is in how we operate on the floor: our merchandising, our people, and, ultimately, our customers. For all of us, the competitive pressure has never been greater and it is only going to become more difficult. To be successful, it will require patience and understanding in knowing our customers and the behavior patterns that drive their decision-making process.
Using this understanding to help turn Discount, Impulse, Need-Based, and even Wandering Customers into Loyal ones will help grow our business. At the same time, ensuring that our Loyal Customers have a positive experience each time they enter our store will only serve to increase our bottom-line profits.
Reprinted courtesy of Mark Hunter