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Other Uses for Market Share Knowledge

The first time I was truly introduced to the idea of calculating my market share was from Roy H. William’s second book Secret Formulas of the Wizard of Ads. It was 2003 and I was trying to learn all I could about marketing and advertising. My math was rudimentary. I didn’t adjust for local economy or youth population. Simply raw numbers. I came up with our market share at about 12%.

At first I was a little disappointed. Roy teaches that the gold standard for any business is 30% market share. That’s a big number. Despite its dominance, even Walmart only has 25% of the grocery market. The optimist in me, however, said 12% was a good starting point and now I had a goal to shoot for. I had just read an article (which 14 years later I cannot find—go figure) that said only 9% of the general public was inclined to shop at local indie stores in the first place. I was already 3 points above that number.

I never did reach 30%, but I did have some other revelations about my Market Share number.

Image result for upward trend free clipartFirst, after going back and adjusting my market size for economy and youth population, our 12% was really closer to 16%. It stayed in that neighborhood until a Walmart Supercenter opened in 2005. We dropped into the 14-15% neighborhood and stayed there until Amazon became a serious player in the toy industry around 2010-2011. We stayed around 12.5% for the next several years until we closed. Even though you can beat a big guy head-to-head, the more big guys in town, the more businesses taking a piece out of the same pie.

Second, that original 12% number got me thinking. A full eighty-eight percent of the market were NOT currently shopping with me. That’s almost 9 out of 10 people. When you look at it that way, it changes your perspective on a lot of things.

In terms of marketing and advertising I realized I didn’t need to reach the entire market to grow my business. If I could just convince 1 more person out of 20 people to shop with me I would have growth beyond my wildest dreams. I really only needed to convince about 2 more people out of 100 to shop with me to have double digit growth. If you only are trying to sway two people out of a hundred you might say something totally different than if you’re trying to sway fifty out of a hundred. With two you can say something direct and personal to a small audience that gets right to the heart of the matter. Trying to reach fifty, you say something generic and non-offensive hoping other forces will come into play to swing them to your side.

In terms of product selection I realized I didn’t have to be all things to all people. I could pick and choose the products I wanted based on my beliefs in the products and how they benefited my customers. Not only does that help with the buying decisions, it helped us stay true to our core values in terms of what we sold and why.

Speaking of Core Values, we didn’t have to be someone we were not.

Meg Cabot said it best when she said, “You’re not a hundred dollar bill. Not everyone is going to like you.” We didn’t have to be liked by everyone. Sixteen percent is a pretty low approval rating. Yet it was higher than any other single store in our market.

Knowledge is power (France is bacon). Knowing your market share might be the piece of knowledge that finally liberates the way you think about your place in the market and the risks you can now safely take with your business.

-Phil Wrzesinski
www.PhilsForum.com

PS Let me first admit that 16% is actually pretty high for an indie retailer. Many of you might do the math and find yourself in the 3-5% range, especially if you have other indie retailers fighting for the 9% that skews shop local. But before I pat myself on the back, you should know that in the early 1980’s we were at that mythical 30% gold standard and then some. Of course that was before Jackson got Walmart, Target, Toys R Us, Sam’s Club, a second Meijer, a new KMart, and a whole slew of other big chains in town (without a population growth to match), and well before Al Gore invented the Internet. We were the large store that was here first. That’s what gave us much of our edge. But even if you do find yourself in the 3-5% range, if the market is big enough, you can do a lot of business with only 3-5% of your market. Plus, when you only have to convince 1 more person out of 100 to get 33% growth, advertising becomes a whole lot more fun.

PPS It used to upset me that about half my friends were not regular shoppers at my store. My parents saw about that same percentage from their friends. Then it dawned on me … Fifty percent of my friends versus twelve percent of the general population. I was ahead of the game. I slept much better that night.

Spotlight on Marketing & Advertising Class Tuesday, June 20, 2017

Here is your chance to learn the equivalent of a degree in advertising in just one night. As one MBA professor told me after sampling the material, “No one is teaching this stuff even at our level, and it needs to be learned!”

If you are a small business owner, you should take this class.
If you are an entrepreneur, you should take this class.
If you are a student studying business at any level, you should take this class.

SPOTLIGHT ON MARKETING & ADVERTISING 

Next Class: Tuesday, June 20, 2017 – 6pm to 10pm

Tuition: $250 (Half-price for any businesses that are JRSA™ Alumni)

Famed retailer John Wanamaker said it best, “Half of the money I spend on advertising is wasted. The problem is, I don’t know which half.” Hundreds of billions of dollars are spent on advertising every year. Most of it poorly.

This Spotlight covers everything from how different types of advertising work to the best ways to use social media to marketing on a shoestring budget to learning the secrets to getting the press to talk about you. You will learn best practices for marketing your business whether your ad budget is $500 or $50,000. You will learn how to create memorable messages that move customers toward your business and you toward your goals. You will learn how to get far more out of your advertising dollars than any of your competitors.

When you take this class you will get…

  • Better, Smarter, More Effective Advertising – You’ll learn secrets that only a handful of businesses know that get greater results per dollar than any of your competitors.
  • One full year of Advertising Support including help finding your message, creating a campaign and buying ad packages
  • A Network of current and previous JRSA™ graduates for support and encouragement
  • Half-Price Tuition for any future JRSA™ programs

Click here to sign up for the class.

-Phil Wrzesinski
www.PhilsForum.com

PS Yes, this will include the material from my new book MOST ADS SUCK. That will only make up about 25% of the material covered. If you have a business to market, this will be the best money you’ve spent on “advertising” ever.

Not Just for Retailers

I was having a conversation this morning when the light bulb went on. I was asked by someone considering enrolling in the SPOTLIGHT ON MANAGERIAL SUCCESS workshop this Wednesday (it is not too late to sign up) whether he would learn anything useful since he “wasn’t a retail store manager.”

The answer is a resounding YES!

In fact, most of what I teach has implications far beyond just the retail landscape. I have followers from all over the world in all types of industries.

If you are in any position where you have to hire people, you need to read my book Hiring and the Potter’s Wheel: Turning Your Staff Into a Work of Art.

If you are in any position where you write copy to persuade people to buy or use your products or services, you can learn from my articles on marketing (and my new book coming out later this spring). 

If you are in any position to teach and lead your staff you would benefit not only from the Spotlight class, but also from the Free Resources on Team Building and Staff Meetings Everyone Wants to Attend.

I know where the confusion began.

The SPOTLIGHT ON MANAGERIAL SUCCESS workshop is being offered through the Jackson Retail Success Academy™. While JRSA™ is mostly geared for retailers, we have had many graduates from other industries. Other than the inventory management segment, most of what I teach there applies to all types of businesses. I run all local classes through JRSA™ because of my partnership with Spring Arbor University and their Hosmer Center for Entrepreneurship & Innovation. They provide a fantastic venue for hosting events like these and have been a wonderful partner.

You don’t have to be a retailer to take any of the classes or workshops I offer. You only have to be open-minded and ready to learn.

-Phil Wrzesinski
www.PhilsForum.com

PS I am already working on a date for the next SPOTLIGHT workshop. This will be an advanced degree in Advertising and Marketing in four fast-paced hours for anyone who has a business to promote. Stay tuned for details.

Sign Up for the Spotlight on Managerial Success Workshop

If you’re still sitting on the fence about signing up for next Wednesday’s SPOTLIGHT ON MANAGERIAL SUCCESS workshop, here are a few questions to ask yourself.

  1. Do you manage a team of three or more people?
  2. Do you feel that your team is not working up to their best potential?
  3. Do you believe you could improve your communication skills?
  4. Do you hate confrontational situations?
  5. Do you believe that team building can be fostered and led rather than just happening organically over time?
  6. Do you believe your new hires need a better, more consistent training program?
  7. Do you believe your current team would benefit from further training?

If you’re answering No then you can stop reading. You’re good to go.

If you’re answering Yes, then ask yourself these two questions…

  1. What will help your business more in the long run – you being there at your business all day Wednesday or you taking a day to learn new skills, techniques and tools to make everyone on your team more productive?
  2. Where else could you get hands-on training to teach you how to lead team building, teach you how to communicate better, and help you build training plans for your employees for only $50 and eight hours of your time?

If you’re still not convinced, let’s make this really simple… If you don’t find value in the program, I will refund your money. Period. (If you read my blog regularly, you know I’m serious about that. Customer first. Always.)

Sign up today!

-Phil Wrzesinski
www.PhilsForum.com

PS Here’s a benefit I have yet to mention. Attend this Jackson Retail Success Academy™ event and you will become an alumni, eligible to attend future JRSA™ events at discounted prices!

 

Talent, Practice, and Luck

One day I would love to go to The Masters in Augusta, GA. I have watched it on TV so many times that I know every green instantly before the announcers even tell me the hole. I love golf. Love to play it, love to watch it. Especially this tournament.

These guys are amazing!

Image result for the masters

I have played golf all my life. I know it takes three things to be successful at golf – Talent, Practice, and Luck. Then again, you can say that about pretty much everything.

Talent in business is the skills you hire.

Practice is the training and preparation you offer.

As the Roman philosopher Seneca the Younger said, “Luck is what happens when preparation meets opportunity.”

Unfortunately many businesses, especially retailers, think the only preparation they need to offer is training for new hires. That would be the equivalent of trying to play The Masters after six weeks of golf lessons. Not enough preparation for the opportunity.

That’s why part of the focus of the SPOTLIGHT ON MANAGERIAL SUCCESS workshop I’m offering on April 26th includes creating an ongoing training program to help your staff be better prepared for the opportunities that arise. Talent alone won’t win the day. Experience alone won’t make you lucky.

If you manage three or more people, this workshop will bring you the kind of luck that wins major championships. Sign up today!

-Phil Wrzesinski
www.PhilsForum.com

PS Yes, I would take tickets to a future Masters golf tournament as barter for my services. I already know where I would stay and what I would do on the course.

The Team, The Team, The Team

If you know me well, you know I’m a Wolverine. Been one since the day my grandfather took me to The Big House at seven years old. It was the only university I applied to attend. If you know the University of Michigan and follow their football team, you’ve heard the immortal words of the late, great football coach Bo Schembechler, “The Team, The Team, The Team,”

Heck, if you’re a sports fan of any team, whether it is women’s gymnastics or men’s lacrosse or anywhere in between, you understand the power of teamwork and cooperation and working together as one unit. Ask any coach in America and they’ll take amazing teamwork over individual stardom every day.

Image result for bo schembechler the team

Why is teamwork that is so important on the playing field so neglected in the workplace?

I used to work on a team for the Los Angeles Unified School District. There were five of us on the team and each week we worked with inner-city LA teenagers at the Clear Creek Outdoor Education Facility in the Angeles National Forest north of the city. We did team building exercises with these kids. We taught them about nature and an outdoors they rarely experienced back home. We had bears foraging our dumpster, snakes slithering under our cabins, and coyotes howling at the moon.

And we had a Team.

At our staff meeting before each group arrived, we discussed who would lead each activity. That was the only person assigned any task. It was naturally assumed that the other four people would do everything else to support the activity and make sure the entire event was successful.

Now, on some teams, this might be a recipe for disaster. If something doesn’t get done, there would be plenty of people to step up and say, “Not my job.” The NMJ’s are killers to productivity and morale.

On our team, because we were hyper-focused on the experience we offered these adolescents, that was never the case. If one of us saw a job undone, we did it. Period. Everything was our job. There was never any resentment because we all had each other’s back and we all had the overall success of our guests as our goal. It was the most amazing work experience of my life, one I still think about to this day.

What made the difference?

When we weren’t leading team building exercises with the kids we were doing team building exercises with each other. We were all experienced at leading these exercises so we spent the summer creating new exercises to try with the kids. We tried them out with each other first. Our leader, Dana (he was a top-level college wrestler in the ’80’s, would love to find him again but I can’t remember his last name), worked with us all the time on communication, cooperation, problem-solving and trust – the core elements of any team building.

It made a difference for us. More importantly, it made a difference for our students (customers, clients, guests…).

This is why I am leading the all-day workshop SPOTLIGHT ON MANAGERIAL SUCCESS here in Jackson on April 26th. I want to teach you Team Building skills so that you can build your team to this level.

If you manage three or more people, you have a team. That team needs a foundation in teamwork that you can bring to the table through what you train and how you train. This workshop will show you how to do it the right way.

Space is limited. Sign up today!

-Phil Wrzesinski
www.PhilsForum.com

PS Our team disbanded when the LA Unified school teachers went on strike in October 1992. When we headed down the mountain after our last group, we didn’t know it would be the last time we saw each other. I headed back to Michigan and joined a new team that was as dysfunctional as my previous team had been functional. The difference? Leadership. Be your team’s Leader by learning how to build your Team.

Hinkley Donuts, Or How to Go Above and Beyond

I had a Hinkley Donut this morning. My favorite is chocolate frosted cinnamon, but I could eat any of about a dozen of their different donuts with equal pleasure. Those of you in Jackson know what I mean. In a statewide competition Hinkley’s Bakery won Best Donuts in Michigan (if they hadn’t there might have been an uproar – or at least a road trip to see if it was true that there existed something better).

When I eat Hinkley Donuts I often think about Ernie.

Hinkley’s Donuts – Best in Michigan!

Ernie sells chairs. Not just any chairs, but fully customizable, fits everyone, incredibly comfortable, office chairs. I put Ernie in the hot seat and asked him about his sales process. He led me through the cold calls, the visits, the dog-and-pony shows, the follow-ups, the closing of the sale and the delivery.

At each point of contact I asked Ernie what his staff was instructed to do. Then I stopped him, and everyone else in the class, and asked, “What does the customer expect out of you at this point?”

This was an eye-opener for everyone in the class. We know what we do, but we rarely stop to think about what our customers actually expect and want. Yet, that is the secret to great customer service – meet your customer’s expectations. In fact, that is critical in today’s connected world where if you fail to meet their expectation, all 962 of their friends on Facebook will know by tonight, and visitors to Yelp and Google will read about it for years.

If you aren’t doing this exercise, you might be missing a critical problem in what you thought was your awesome customer service that has been holding you back.

Once we established the customer’s expectations I asked Ernie a second question. “What would it look like to exceed your customer’s expectations?” If you want to take your customer service to the level where it generates Word-of-Mouth, you have to exceed your customer’s expectations. 

Ernie’s sales team did early morning or early afternoon visits to show off his chairs. We wondered what would happen if the sales people showed up with Hinkley Donuts (well, okay, the equivalent in that town) for morning meetings or Klavon’s Pizza for afternoon meetings. All it would take is a simple call to the local Chamber of Commerce to find out which local bakery or pizza joint is best known in town. A good salesman could probably find a way to get that info in a conversation. I told Ernie, don’t announce you’re bringing the yummies. Make it a surprise. As Roy H. Williams says, “Surprise is the foundation of delight.” It was a simple change, an inexpensive change, but one that would pay high dividends.

By the time Ernie was out of the hot seat he had several ideas of how to meet and exceed what his customers expected. I’m pretty sure he’s been doing that ever since.

When you go above and beyond what your customer expects, you will delight her and win her as a customer. No matter what competition you face, no matter what technology disrupts your future, that will always be true.

That’s what I think about when I eat a Hinkley Donut.

-Phil Wrzesinski
www.PhilsForum.com

PS Yes, I can be bought with food. But it isn’t so much the food itself as it is the gesture. You went above and beyond because you found the local source and made the effort to ply me with something unique, not generic or mass-produced. That’s a powerful statement that earns a lot of trust.

Hiring People Who Believe

I stepped out of my comfort zone tonight. You read this blog because you’re an independent retailer. At least that’s who I normally write and speak to. Tonight I spoke to dentists. I spoke the Jackson District Dental Society about hiring and training.

Image result for jackson district dental society
Jackson District Dental Society

Their issues are interesting. They hire hygienists and assistants who need specialized skills and training and degrees. They hire front office staff who need to know deep terminology exclusive to their trade and the idiosyncrasies of dental insurance. They need a well-balanced staff to maximize their profits. If they aren’t seeing patients, they aren’t making money. Not exactly the same as hiring for retail.

Or is it?

As I learned years ago, there are certain skills I can teach and certain traits you have to bring with you. When you hire the right traits, your team is better right from the start.

Simon Sinek said it best… “The goal is not just to hire people who need a job; it’s to hire people who believe what you believe. I always say that, you know, if you hire people just because they can do a job, they’ll work for your money, but if they believe what you believe, they’ll work for you with blood and sweat and tears…”

Hire people who believe what you believe.

In a dentist’s office or a toy store, it makes a huge difference. If you like to joke around and have fun and you hire someone who doesn’t, you’ll both be miserable. If you like everything to go exactly like the book and you hire a maverick, you’ll both be miserable.

As we went through all the steps outlined in my book Hiring and the Potter’s Wheel, it was obvious that hiring and training is the same no matter what industry. If you follow the steps the potter follows, you’ll end up with a team that is a work of art.

And when you’re a dentist, the better your hiring and training, the longer and stronger your staff becomes, the more time you can devote to taking care of your patients.

Okay, so I wasn’t that far out of my comfort zone. I believe in having fun helping others. Tonight I spoke to a group who believes the same.

-Phil Wrzesinski
www.PhilsForum.com

PS The only thing about giving talks in my hometown is that the questions usually get around to the radio ads I would run and how they were different than everything else you heard on the air. I told them that presentation happens as soon as this one ends.

In Retail it is All About Location

Let’s get the elephant out of the room right away.

How can I write a blog about being a successful retailer when I closed my retail store? I can sum that up in three words…

Location. Location. Location.

Yes, we were having a tough time with cash flow. That’s the usual culprit behind any store closing. Much of that was due to our location.

Location Issue #1

The population of Jackson has been stagnant at best the last several years. The youth population, however, has shrunk considerably over the last several years as birth rates declined for all groups but teens, and school enrollment is down huge since 2007. On top of that, average household income in the city fell from around $35K per household to $27K per household (well below the national average of around $56K).

I have constantly talked about paying attention to your Market Share. To know your Market Share you first have to know your Market. Ours has shrunk over 40% since 2007. Fortunately, our share of that market only dipped a little. We still had our piece of the pie, but our pie had turned into a tart.

Location Issue #2

We own and occupy a large building on the north edge of downtown. We have been a large toy store for decades, carrying toys, hobbies, baby products, sporting goods, scouts, and more. When the market could bear it, we had a ton of inventory, but scaling back inventory to match the needs of the community meant less efficient use of space and less of the “impact” of being that large store that had everything.

We discussed converting to a smaller store, more in alignment with the population and income, but that would have led to many long-time customers lamenting that we just weren’t the store we used to be or the store they remembered. Better to close while the memories were still positive.

Location Issue #3

I am a big believer in downtowns. Call me naive but I still believe downtown shopping districts can be successful. It takes dedication from the shop keepers, the landlords, and the city leaders to make it work. It takes smart policies, united fronts, and strong relationships to make it work. We have some of that in Jackson, especially among the retail owners. We also have a city council dedicated to improving the streets and sidewalks and green spaces in our downtown. Unfortunately, that also means a ton of disruptive construction. Two years of it! (and counting.)

Our city leaders are not retailers and don’t understand how construction affects retail. They saw an opportunity to get roads fixed and attract new development (all good things), but didn’t see the consequences to the existing retailers and restaurants. When you are trying to dig out of a cash flow hole, having the busiest street in town – the one that goes right by your building – be restricted from three lanes to one with backups that stretch for blocks for an entire spring and summer is not a good recipe for success. At one point we had so much construction downtown that one detour actually led you to another street closure dead-end, and only if you had local knowledge would you know which alley would get you back to open road.

In a couple years, our downtown is going to be new and fresh and repaved and ready for business. But the last two years were pretty tough on the businesses already here, especially for us as our market declined.

Yeah, Amazon is a deal-changer for many retail categories. Yeah, our own vendors are making decisions that hurt the indie retail channel. Yeah, customers are as fickle as ever and have power like never before. None of those are insurmountable. You can still compete. Even as we closed, we were holding our own for our market. We just didn’t like the direction our market was heading.

If your market is your problem, you can do one of four things, Move, Close, Change or Wait. We chose to close.

Now you know.

-Phil Wrzesinski
www.PhilsForum.com

PS I’ll discuss the other three options and what would make them attractive in future posts. Right now I have to go let the big elephant in the room out to roam the savanna.

Friends With Benefits

Align yourself with charity. Pick one or two local organizations (or more if you’re up to it) that you feel strongly about. Do something special for them. Help them out. Be their friend and ally.

You’ll both benefit from the friendship.

Santa Paws 2015 #1

This is a picture of the Cascades Humane Society doing their annual Santa Paws event – pictures of your pet with Santa Claus. They called me a few weeks ago looking for a space to take the pictures. I have a stage. I love dogs – especially rescued dogs. I said yes.

They coordinate getting Santa here. They hire the photographer. They set up the backdrop. They sign up and schedule the photo shoots. They work the tables. They get the profits.

We get the traffic. We get the goodwill. We get the customers telling us how nice it is that we are doing this for them. We get the social media exposure. We get exposed to everyone on their mailing list. We get our name mentioned in their press releases (and non-profit press releases get picked up far more often than for-profit press releases).

Our friendship with them brings benefits to both of us.

When you partner with a charity, you expand your reach. You get exposure to a crowd of generous people who love to give to charitable causes (can you think of a better demographic for the independent retailer?). You get touchy feely goodwill because you are helping out. You don’t just look like a greedy merchant. You strengthen your community (the better the non-profits do, the better everyone does).

Make friends with a charity or two. You’ll reap the benefits.

-Phil Wrzesinski
www.PhilsForum.com

PS Your charity doesn’t have to be aligned with what you sell. We don’t sell pet toys or pet food. Pick charities based on a few different factors such as…

  • Do they have an active base of followers?
  • Do they want to “partner” with you (or simply have you do all the work)?
  • Do they align with your own personal core values?
  • Are they well-respected in the community?

Those are all good reasons for making friends.