Author: Phil Wrzesinski

Phil Wrzesinski is the National Sales Manager of HABA USA toy company, a Former Top-Level, Award-Winning Retailer, a Thought-Provoking Speaker, a Prolific Author, a 10-Handicap Golfer, an Entertaining Singer/Songwriter, and a Klutz Kid who enjoys anything to do with the water (including drinking it fermented with hops and barley), anything to do with helping local independent businesses thrive, and anything that puts a smile on peoples' faces.

May 10, 2018

Cutting Expenses The Wrong Way

I was in Walmart yesterday. I had to pick up a few things. At the checkout, the cashier kept doubling bagging all of my items. I asked her why.

“These bags tear so easily that almost everyone has a ripped bag at the end. They used to be better but these new bags are too thin.”

I hope for Walmart’s sake that the new bags are less than half the cost of the old bags. Otherwise their cost-cutting move is costing them more than it saves.

I get why they did it. I’ll bet their bags are a huge expense for them. I’ll bet someone pitched them the idea of a cheaper bag, or knowing Walmart, they probably went to their vendor and demanded a cheaper bag. The only way to make it cheaper was make it thinner. And now their employees are double bagging everything so that you can get your groceries home in one piece.

How’s that cheaper bag working out for you?

Bags, like so many other non-merchandise items, seem like a hassle expense. You know you need them but you hate paying for them. I know I did. But that didn’t stop me from buying better, thicker bags than I probably needed. Mostly because I also looked at bags as being a reflection of my brand. Cheap, flimsy bags send the signal that I care about my money more than I care about you. Sturdy, reusable handle bags say I care about you more than I care about money. (Remember that Values post I just wrote?)

The problem is that we too often look at our expenses as single, individual entities instead of how they fit into the whole. We make decisions on those expenses purely on a financial basis instead of thinking about how we want to present ourselves and how we want our customers to feel about us. You have to consider everything, otherwise your cuts may end up costing you more.

In the 68 years we ran Toy House, one of our most profitable years was 2009, smack dab in the middle of the great recession. I had to cut expenses that year to get that profit. Here is a post I wrote January 11, 2010 about how I cut those expenses … “Cutting Expenses the Smart Way”

Sometimes you need to cut expenses. How you cut them is often more important than how much you cut them.

-Phil Wrzesinski
www.PhilsForum.com

PS This trip down memory lane looking at old blogs has been fun for me. Maybe it will be fun for you. Here is a link to one page with all 897 blog posts to date.

May 9, 2018

Asking Questions, Playing Games, Laughing, and Learning

Occasionally I go back to my old blog posts to see how things have changed in retail. Sometimes I see how things have stayed the same. Here is something I wrote almost ten years ago on December 3, 2008 …

The best stores have a staff that listens, that repeats back what a customer says and asks questions to clarify everything so that there is no misunderstanding. We may not be the best listeners all the time, but we’re working on it. Would you be surprised to know that the last ten staff trainings were on communication?

Nine years and five months later I wrote …

Once again, a properly trained staff makes a huge difference. This team knew that by asking questions they could get to know the customer better. Getting to know the customer better allowed them to pull better pieces that more closely matched the customers’ needs.

I read that last line from the 2008 passage and immediately opened my 2008 file with the notes of all our staff meetings. (Yes, I have kept those notes all these years. You never know when you’ll need that info again.) Did I really do ten straight staff trainings on communication? Yes, indeed.

It started on January 14, 2008 with my favorite staff training activity of all time where we “raised the bar” and everyone had to go over it. On March 10th of that year we worked on how to communicate with customers “when something goes wrong”. On April 7th we focused on communication among team members so that we could pass customers to other sales people, make sure all areas of the store were covered, and have better communication between our buyers and our sellers.

When I got to October 20th, the memories hit me like a tsunami. I remember when I got the idea for this meeting. My Goal for the meeting was to help my team learn how to listen better, ask better questions, and decipher what customers were trying to say. As with all my staff meetings, it started with … This will be a successful meeting if my staff learned the importance of asking questions and understanding that even when the customer doesn’t know the name of the product, with a little work we can figure out exactly what they need.

I was awake one night flipping channels when the television show Whose Line is it Anyway? with Drew Carey came on. I knew instantly the Task that would lead us to our Goal.

The staff was split into two teams to play a series of four games.

The first game was called Questions. One person from each team squared off. They were each assigned a character and then they were given a product. The two then had to try to sell the product to the other person with two rules. First, they could only use questions. Second, they had to stay in character. The game went until one of the rules was broken.

The second game was Worst Ad Ever. Each person drew a product name out of a hat. They had to go find the product and then do the worst infomercial ever for that product. You might think this would be easy, silly, and pointless. The staff, however, found it to be a little more challenging. First, they had to know the product. You can’t act dumb about something until you are smart about it. Second, they learned more about each product that was featured. Mostly, though, they learned more about what not to say so that they would catch themselves and each other whenever they went into some Ron Popeil inspired pitch.

The third game was my favorite. I called it Santa’s Sack. Four people got up at once and drew product names out of a hat. Each person now had to pretend he or she was that product sitting in Santa’s Sack getting excited about the child who was about to receive them as a gift. They had to hold a conversation with each other about that excitement and their recipient without saying what product they were. The rest of the team had to guess the products.

Not only were they learning to talk about products based on what they did rather than what they were, they were tapping into the excitement that each item they sold was going to be a gift for someone special. They were learning to transfer that excitement onto the customer.

The last game was Toy Taboo. In the game Taboo you are given a word you need others to guess. You are also given a list of words you cannot say, words that are taboo. I created several cards with different products and related words they couldn’t say. For instance, LEGO was one word. The taboo words were Construction, Brick, Building, and Plastic. The lesson was simple, learn to describe toys in unique ways and you’ll be better at deciphering the descriptions our customers gave for toys they didn’t know the name.

We laughed a lot at that meeting. We laughed a lot at most of our meetings. We learned a lot, too.

-Phil Wrzesinski
www.PhilsForum.com

PS I’m not sure if this is a post about communication or a post about staff trainings. I’ll let you decide.

PPS If you look at this post as a Staff Training post, one added benefit of the games we played was that it got everyone up and acting. When you have to act and perform and be goofy in front of your peers, you lose your fears of interacting with strangers.

PPPS If you look at this post as being about Communication, listening, asking questions, and clarifying are three amazing tools that will help you close more sales.

May 8, 2018

“Everything Cheaper Somewhere Else”

I used to hate anonymous commenting on news articles and blog posts. It is so easy to hide behind a pseudonym and take unsubstantiated potshots at people and businesses, spread rumors, and even spread downright lies.

As a retailer, I took every negative comment and review of my business personally. Some of them hurt, especially when they weren’t true. The misunderstandings were one thing but the outright lies were the worst. They cut to the bone.

I remember one day in the infancy of online news when a fellow downtown business owner alerted me to comments posted on an online news story that attacked both my store and me personally. He warned me not to read them. I didn’t heed his warnings.

One person had taken it upon him or herself to just rip the business up one side and down the other, calling us, among other things, price-gougers who were just out to destroy the little people in town. This person claimed that he or she could find everything we sold in our store cheaper online.

I took offense to the first part. The person posting the comment had no idea what I paid myself or my staff or our profit margin or what we gave to charity or what causes we supported. I am a forgiving person, though. I will forgive them their ignorance.

The second part, however, was pretty much true. Not only could that person show you the items cheaper, I probably could, too. After all, I had Internet access. I could also show you sites and stores where just about everything we sold was more expensive than our prices. That exists, too.

In fact, if prices weren’t fluid across different channels, Retail would look a whole lot different and be a lot less fun. Everyone would pretty much do the same thing and charge the same for it. Yawn.

Retail is a game, and the game can be boiled down to this … Find the Value you can give the customer that will make it worthwhile for them to pay the price you wish to charge.

At the ballpark they charge you more for a single beer than you would pay for a twelve-pack at the store. You buy it because you want to drink a beer during the game. There is enough Value in enjoying that beer while watching the game that makes you pay the price. (Don’t want to pay their outrageous prices? You can eat before you go to the ballpark. Most people can handle 3-4 hours between eating. You can also drink water for free. They have to provide it to you.)

People call them price-gougers all the time. It doesn’t stop them from raising their prices and making money. They offer you the Value of being at the game and watching the action in person.

The real question you need to ask yourself as a retailer is … What Value are you adding to the equation and will that Value be enough to get people to pay your prices?

You can add Value in several ways. You can:

Offer services other stores don’t have (i.e. layaway, free gift-wrapping, assembly, delivery)
Curate the selection to help customers get only the best solutions
Align your business with a social cause
Offer follow-up services (such as the free 30-day riding tuneup that we used to offer with every bike we sold)
Build relationships to the point that the customer feels as much ownership in your store as you do.

Any one of those is a way to “play” the Retail Game. Play more than a few of them and you’ll never worry about how someone can find “everything cheaper somewhere else.”

Were we the lowest priced game in town? Nope. Never tried to win that race to the bottom. But in a 2007 survey of Jackson County residents about stores that sell toys in Jackson, we were rated as having the highest “Value” ahead of Walmart, Target, Toys R Us, Kmart, and Meijer (all whom love to advertise their “lowest prices”.)

What Value are you adding to the equation?

-Phil Wrzesinski
www.PhilsForum.com

PS I have a good friend also named Phil who also ran a toy and baby store in the other Jackson (MS) who never liked MAP (Minimum Advertised Pricing) because it made everyone price their goods at the same price. He said true merchants have no problem with the undercutting of prices on the Internet because they know how to offer Value and make sales at higher margins. As much as you hate to admit it, he’s right. MAP only protects you at the margin the vendor thinks you should make, not the margin you deserve for all the value you offer.

PPS As for anonymous negative comments online, if they are an attack on your character or the character of your business, ignore them completely. Your actions speak louder than your words. Use your actions to prove that person wrong. If the comments are simply something misunderstood, you can respond for clarification, but only if you can substantiate your claims without putting down the person who made the comment. More often than not, however, it is best to ignore anonymous comments, period. I’ll talk about how to respond to Reviews in a future post.

PPPS A few of those ways to play involve the skills and training you give to your front line staff. As I pointed out before, that is probably the easiest way to add the kind of Value your competitors are not adding to their equations.

May 3, 2018

Here is What Winning Looks Like – Sweetlees Boutique

Sometimes it is easy to talk about the mistakes retailers make and simply caution you to not make those same mistakes. I’d like to share with you a story of an experience that went right. A long-time Toy House customer, my boys’ piano teacher, and dear friend Jen sent this to me. In her words …

“Well, the basic story was this…. you know where it’s going right?

I went to a small locally owned (in Mason, MI) women’s boutique, Sweetlees Boutique. (Because I will tell everyone about how amazing it was, and where to find them—160 E. Ash St, Mason, MI 48854.) The workers were so attentive offering to find you sizing, suggesting things they thought would look good on your body. They were fitting both my mom and I who couldn’t be more different in that department, and they did a fabulous job, asking questions, and pulling pieces for us to look at or try. Amazing experience. Both my mom and I purchased something. It was our first time there and we will definitely go back again.”

Let’s unpack that to see what they did so right.

“The workers were so attentive …”

How many times have you been in a retail establishment where you couldn’t even find an employee, let alone one who seemed remotely interested in helping you? The Wall Street Journal just wrote Monday about the dearth of employees in retail stores. Macy’s has cut 52,000 workers since 2008. Think about that number when you’re looking for someone the next time you visit a department store.

Think even harder about that number when you’re making out the next schedule for your store. Are you making a schedule to minimize payroll or maximize sales? If you think of your staff as your greatest expense, you’ll do the former. If you think of your staff as your greatest asset, you’ll do the latter.

“… suggesting things they thought would look good on your body.”

At one time this was the norm in a women’s clothing store. It was the expectation. Anything less and you would be writing a different review. Today it seems new and different and special.

That’s the one good thing you need to understand. The overall bar for customer service has been lowered so far that just doing the things you’re supposed to do will make you stand out in the crowd.

A properly trained and properly motivated staff can do wonders for the way your store is viewed compared to the competition. While everyone is all worried about high-tech this and omnichannel that, going old-school will win the day more often than not.

“… they did a fabulous job, asking questions, and pulling pieces for us to look at or try.”

Every customer that walks through your door is there to solve a problem. The problem might be as simple as killing time. It might be as complex as buying the perfect series of gifts for the hardest person on your list. You don’t know the problem until you ask. (And you won’t get the answer you need if you haven’t first made a connection.) This doesn’t come naturally to everyone. You need to train your staff by showing them how, role-playing it, and practicing it. The stores that do that best are the stores that are winning.

“Both my mom and I purchased something.”

You have a lot of hurdles to overcome to get a sale from a first-time visitor. You have to make her feel comfortable. You have to figure out the problem she is solving. You have to present her with a valid solution. You have to overcome her hesitations and objections. You have to make her want the solution more than she wants her money. All of those are actual steps in a process. One misstep and it’s a no sale.

We call it browsing because many times customers want to go into a new store just to get a feel for the place. No pressure to buy, just a scouting trip to see if they like it. Sometimes you get lucky and they fall in love with a product by accident. That isn’t selling. That’s clerking. Anyone can do that.

If your sales team is waiting for the customer to come up to you, many of them won’t and you’ll have lost out. If your sales team hasn’t made a connection, unless she falls in love with a product by accident, she won’t be back, either. That’s on you.

“… we will definitely go back again.”

That, my friends, is what winning looks like. Bravo to Sweetlees Boutique. Bravo! Thank you, Jen, for sharing that story with us all.

-Phil Wrzesinski
www.PhilsForum.com

PS In the same message, Jen told me about another retail experience that didn’t end so well. I’d rather leave on a high note and save that tale for later. If you have story of someone doing it the right way, please share. Send me an email or find me on LinkedIn.

May 1, 2018

Policies for the Minority Hurt the Majority

The date for your annual family picnic has been set. You’re bringing your famous corn casserole. Your mom knows you’re bringing your famous corn casserole. She looks through the coupons from the local and Detroit Sunday papers and finds they both have the same coupon for your number one ingredient. She clips them for you. You also clip both coupons from your copies of the Sunday papers and head out to the store.

You get to the checkout line with your four identical coupons from the newspaper only to be told you can’t use them. The store has a new policy limiting you to only two identical coupons per transaction. You feel like they’re looking at you out of the corner of your eye because you’re trying to cheat them out of an extra fifty cents on a can of corn.

Heck, the time it took you to cut those two fifty-cent coupons probably wasn’t worth it, but now you’re walking out feeling judged, and just a little ticked off that the store has such a ridiculously strict policy for something that seems so innocuous. The cashier, feeling your pain, tried to use the third coupon, but it shut down the register completely and needed a manager’s override which only added to your feelings of shame as you could feel the eyes of everyone else in line behind you judging you as the criminal you appear to be.

Does that sound far-fetched?

That is what has happened at a large, Midwest grocery store chain. Apparently to cut down on extreme-couponers and people printing multiple coupons off the Internet, this large chain has reprogrammed their registers to only allow two of any identical coupon per transaction. Use a third one and the register shuts down. Your only choices in the above scenario is to either cause the people behind you to wait even longer while you make the cashier ring up two cans of corn separately or forego the extra dollar in legitimate savings.

Either way, you feel like crap and are probably thinking you’ll avoid that store the next time you have coupons.

Plus, the store really didn’t change anything. The extreme-couponers are still going where the best deals can be made. If that means they stand in the self-checkout line and ring up thirty seven transactions, then they’ll stand in that line. The money they believe they are saving is worth their extra time (and they don’t care about the people behind them in line.)

The store doesn’t save any money or make their business any better, either. In fact, they slow down the checkout as people with three or more coupons have the cashier do multiple transactions. And unless the coupon is provided by the store itself, the store isn’t saving any money. Jolly Green Giant reimburses them for every coupon plus a little extra for handling.

Most importantly, the store sends a loud and strong message to its customers. We don’t trust you!

Here is where the retailer went wrong …

The retailer saw a tiny percentage of customers taking advantage of a loophole or doing something they just didn’t like. The retailer then enacted a restrictive, me-first policy that negatively affected all of their customers, including the ones who never had any intention of “taking advantage” of the retailer. Those customers were just doing what most would call common sense, using the system in place to save a little money.

As retailers we do that often. We create rules to stop the minority by inconveniencing the majority.

We do it with restrictive return policies. I saw one store that had a 30-day return policy. Period. No exceptions. Remind me not to go Christmas Shopping there before Thanksgiving.

We do it with limits for credit card transactions. (See my recent post on that here.)

We do it with rules. I used to have a rule of certain items we wouldn’t giftwrap for free. When we realized the rule was me-first, we changed it to only restrict items around which the wrapping paper wouldn’t stay (like an assembled tricycle).

The funny thing is that these restrictive rules never really stop the behavior we intend them to stop.

People who exploit loopholes will exploit loopholes. If you close one, they’ll look for another. Fortunately these people are the exception, not the rule. So treat them like an exception, not the rule.

Set your policies up to be customer-first.

Make your return policy as liberal as possible. If you have one person taking advantage of the situation, deal with that one person. I had a customer bring back fourteen puzzles one year, all because they were missing a piece. As it turns out, I only had fourteen puzzles returned that year. Those fourteen pieces were the only ones out of a million pieces we sold that were “missing.” I pulled the customer aside, explained this fact to her politely and respectfully, and told her she was no longer allowed to return any puzzles.

You may be surprised to know, she continued buying jigsaw puzzles from us.

Make all your rules less restrictive than your competitors. First, very few people will take advantage of you. Second, most of them are still making you money because they are shopping in your store. Third, no one walks out feeling shamed in any way.

Part of the goal of every transaction is to win the right for another transaction. Piss off your good customers and all you’ll have left are those trying to find another loophole to exploit.

-Phil Wrzesinski
www.PhilsForum.com

PS Yes, LL Bean just changed their incredibly liberal no-questions-asked-we’ll-take-it-back return policy because of people trying to exploit it. But if you look at it, the new policy is still far more liberal than any of their competitors, still fits their quality-first guarantee, and doesn’t hurt any honest customers in the process.

PPS I’m still trying to understand why this grocer created this new coupon policy. If the coupons were from the brands, the grocer would get reimbursed, so no harm there. If it was because of online coupons being printed multiple times, there are many ways to avoid that issue with today’s technology, or even by going old-school with a really strong legal disclaimer. Either of those would be preferable to being stuck in line behind someone trying to buy seven cans of corn and not understanding why the coupons his sister gave him won’t work.

April 26, 2018

Product Selection – Curation or Saturation?

I went to visit a fellow toy store owner in Cleveland. At that time Michael had three stores in the area. The store I visited was on the opposite spectrum of mine in terms of size. He had about 1,100 square feet of selling space. I had 16,000 square feet of selling space. Yet we were both successful toy store owners in our markets. I love seeing stores like his and discovering the creative ways they show off all the wonderful and unique products they carry. I often saw many of the same brands we carried.

We got to talking about the different challenges of running small versus large stores and one of those challenges was buying product to fill the shelves, especially something as simple and common as jigsaw puzzles. Michael had about 4 feet of space dedicated to jigsaw puzzles. I had about 44 feet of space.

Michael said, “It must be hard for you to buy puzzles to fill up all that space.”

“Are you kidding? It’s easy, I just go through the catalog and buy them all and let the customers decide which ones I should reorder. I think it would be way tougher trying to narrow it down to only four feet.”

That was the big selection difference between our stores—Curation versus Saturation.

Both methods have their pros. Both have their cons. Both can be used as your calling card to advertise to potential customers the advantages of your “Selection.” (As I said in a previous post, the customers you can most easily steal from your competitors are customers who shop the category killer in your industry for the Experience and the Selection.)

This was just the young kids puzzles. Opposite that was another 44 feet of jigsaw puzzles!

SATURATION

Saturation is when you give your customer all the possible (or likely) options for any given product category. I found it was much easier, when buying jigsaw puzzles, to pick the ones I didn’t want than to pick the ones I did want. I often heard myself telling the rep, “I’ll take everything from that collection except this one.”

In a store of my size, Saturation wasn’t only easy, it was necessary. We needed a lot of product to fill our shelves and make our store look full. We used that method of stocking for many different departments and categories. We also played up the strengths of Saturation by pointing out that we carried more toys from more vendors than any other toy store in America—even Toys R Us! We bragged how we were the largest toy store in America because of it. (He who has the most toys wins!)

The downside to Saturation was twofold.

First, we had a lot of products that didn’t sell well. We had more than our fair share of slow movers. I solved that problem by having an annual clearance sale every July to get rid of the merchandise that didn’t move. Our inventory turns, however, were lower than the average for indie toy stores.

Second, sometimes we overwhelmed our customer with too many option. Analysis Paralysis. To overcome that I needed to have a staff that knew our products inside and out. We spent a lot of time training the staff to curate the selection after the customer explained what she needed.

Your Category Killers built their entire business models around Saturation. Saturation appeals to the customer who wants to browse and sort through the options. Saturation appeals to the customer who doesn’t know what she wants. Saturation makes you look like the expert. Bigger, better, bestest.

When these stores first opened up they were amazing. Nowadays, however, that saturation (especially without a knowledgeable sales staff) seems overwhelming or simply a waste of time and space. Many of these same stores are now building smaller footprints because they realized they don’t have the payroll to staff such a huge store properly.

CURATION

The other side of the coin is Curation—when you pick only the best items or options to offer your customers so that they don’t have to make any tough decisions.

Curation is great because it streamlines the process for the customer. It is attractive to that same customer who didn’t know what she wanted because it takes some of the guesswork out of the equation for her.

A carefully curated product selection can also send your customers the message that you are the experts in your category … As long as you have first earned their trust.

Curation without Trust is just a “poor selection”.

Here is how you win their Trust with your Curation:

Make sure you have the best solution available, no matter what it costs. If one of your competitors offers a better solution, you didn’t curate well. Be ready to defend why it is the best option. (PS You don’t have to sell a lot of that option, but you do need to have it.)
Make sure your selection is neat, clean, organized, and well-merchandised. If it looks like you don’t care about your products, no one will trust your Curation.
Make sure your sales team knows every product inside and out including how each item is used and the difference between the Best, Better, and Good options.
When you show a customer your options, ALWAYS lead with the Best.
If you don’t carry the “most popular” item in that category have a simple and understandable explanation why. (“We can’t get it,” or “It sucks.” are not good answers. Try “It is an exclusive to … but we prefer …” or “It doesn’t work as well as this option because …”)
Make sure you are never out of stock of the best selling option.

If you have a carefully Curated collection of merchandise, you can win the Selection crowd just as easily as if you have a Saturation of products. You do it by advertising that you’ve taken all the guesswork out of the equation.

Both methods can help you steal customers away from your competitors, but only when you do them right and with purpose.

-Phil Wrzesinski
www.PhilsForum.com

PS One big discussion taking place in the indie toy world right now is whether indie stores should pick up more of the mass market lines Toys R Us used to sell to try to win over those customers. The answer to that is Yes and No. Yes, if the product is both one of the best options to have in your Curated selection and also one that you can be profitable selling. No if it doesn’t meet those two criteria. More often than not the Category Killer had the “most popular” item. More often than not, that item was not one of the best options. As long as you can answer why you don’t carry the most popular item in a solid way, you’ll win over customers.

PPS Of the two methods for product selection, Saturation takes more money, Curation takes more time. If you have the resources (space and money), go for Saturation and combine it with a killer trained staff. You’ll be well on your way to becoming a Category Killer.

PPPS There is a Third Option. Curation with special order. The newer, smaller Category Killer store formats are using their distribution centers to order in the products they don’t keep in stock in the stores. They don’t want a customer walking out the door empty-handed. While this is the ultimate situation where you can get anything a customer wants in a day or two, it is built for the customer who knows exactly what she wants. Until your vendors can support you in that manner, make sure you have the right solutions and a staff that knows what you sell.

April 25, 2018

KB-Toys Making a Comeback(?)

KB-Toys is coming back from the dead. The toy retailer that went bankrupt in 2009 is going to stage a comeback to try to pick up some of the business dropped by the closing of Toys R Us (TRU). According to one article, they will likely have a bunch of pop-ups this fall and more permanent locations by next year.

(picture from edplay magazine)

My expectation is that they won’t pick up as much of the toy industry as they think.

When TRU closed they were still doing billions of dollars in sales. They still had over 100 million customers. They actually showed a profit last year. Unfortunately it wasn’t enough to pay the massive debt they had acquired.

While a lot of uneducated pundits and many comments on several articles about Toys R Us closing want to blame Walmart and Amazon for their demise, those two companies had already taken their sizable bites out of TRU’s hide. People who wanted to shop purely on price or convenience were already going to Walmart and buying toys with their groceries. People who knew exactly what they wanted and didn’t want to leave the house to get it were already shopping on Amazon.

The customers still shopping at Toys R Us (over 100 million times, mind you) were going there for one of two things …

The Experience
The Selection

As an independent toy store owner who offered events, demos, and a fun, friendly environment for shopping, I can rightfully roll my eyes when someone mentions the “experience” of going to a Toys R Us. In fact, most of your independent toy stores will be able to offer a consistently better “experience” than going to TRU. But the customers going there weren’t comparing it to an indie toy store. They were comparing it to Walmart or Target.

You never heard a young kid pleading, “Please, take me to Walmart, puhleeeeezzzze!”

The Selection crowd was going to Toys R Us to browse the aisles. Amazon, as incredible as it is, isn’t built for browsing. Oh sure, you can search stuff on Amazon. As of last September Amazon was closing in on Google as the primary place people go to search for products. But Amazon searching is not the same as browsing. You still need a starting point.

If you want to walk aisles, touch and feel products, and get inspired, you have to go to a brick & mortar store to do that. Outside of a handful of my friends in the independent, specialty toy industry, no one had a larger selection of toys to browse than TRU. Customers went there because it was a better selection and an easier browse than the cramped, too narrow, too tall, too messy aisles of a typical Walmart or Target store.

When KB-Toys opens their pop-ups this fall they won’t have either The Experience or The Selection to truly catch the ball dropped by TRU. Sure, they will make sales. The pop-up model has been proven to be effective to an extent. Whether it will be enough to jump back into the toy market full fledged, however, time will tell. My guess is it won’t be enough and KB will become a perennial pop-up along the lines of Halloween USA. (At least that is what I would advise them to do if they were to ask me.)

The lesson here for specialty retailers like you is to recognize the different types of customers and why they shop at the different competitors you face.

Walmart is all about price and convenience. The cheaper the better. Amazon is for when you know (roughly) what you want, and you don’t want to go out to get it. Your category killers (JoAnn’s, Michael’s Toys R Us, Cabela’s, Barnes & Noble, PetSmart, et al) are more about Experience and Selection. Of the three, the one who most closely shares your customers is the category killer. Your growth is dependent on how many of those customers you can peel away. You already know you can beat them on Experience. Tomorrow we’ll talk about how you can beat them on Selection, too.

-Phil Wrzesinski
www.PhilsForum.com

PS The toy industry, with the closing of Toys R Us, offers a lot of opportunity for different stores to pick up the slack. There will be a lot of disenfranchised customers. Most everyone in the channel from the big box stores to Amazon to the indie stores stand to gain from their disappearance. The biggest winners will be those who have the most compelling message to the former TRU customers. Knowing why they were still choosing TRU over Walmart and Amazon gives you the heads up on what to say to get them to notice you.

April 24, 2018

Hire Me to Be Your Coach

I played the role of Father in The Nutcracker Suite on stage at the Michigan Theatre. I was in eighth grade. It was part of our LEAP class (Learning Experience for Academic Progress). It was a play more than a ballet, although we did have a dance troupe come in and do some dance numbers. I don’t remember much of anything about the play itself. I couldn’t tell you anything about the story, the other characters, or even my performance. About all I remember was I played the role of Father and I loved being on that stage.

Phil Wrzesinski speaking to a packed house in Grand Rapids, MI

I’ve never really been afraid of standing on a stage in front of people. Oh sure, I had a kaleidoscope of butterflies fluttering in my stomach moments before I took the pulpit to do a guest sermon at church. But those butterflies settled down the moment I began to speak.

Whether it is a crowd of 500 at a trade show conference, a group of screaming kids in the dining hall at camp, or a room full of revelers at a brewpub, I love to perform.

That’s why when I began building Phil’s Forum I focused on speaking and presenting, doing workshops and seminars and webinars. That’s what brings me the most joy (and people said I was pretty good at it.)

But my real goal, my true focus of Phil’s Forum is about YOU. Your success. That’s all that matters.

That is the reason behind all the Free Resources for you to download. That is the reason behind writing over a thousand blog posts for you to consume. That is the reason behind offering all those classes, presentations, workshops, and webinars for you to attend.

That is the reason why you’ll find a new page on my website.

Many of you have contacted me about private, one-on-one consulting and coaching. While I often said yes, I didn’t have a plan in place for how to handle and structure those requests. Nor did I have a firm concept for how I felt I could best work with you.

Until now.

Coach /kōCH/ (noun) An instructor or trainer. A tutor who gives private or specialized teaching.

A Consultant is someone you consult for advice and opinions. A Coach is someone who teaches you how to do what you need to do to be successful.

I am chock full of advice. I give it away freely. You can shoot me an email with a question and it is highly likely I will answer it (for free). If you read this blog regularly then you can probably guess my opinion on a topic before you even ask. Lots of people get paid for their opinions. It always seems a little disingenuous to me. If you make your living that way, you always want to keep your client in a position of needing your opinion. There is almost a built-in need for keeping a client partially in the dark so that they don’t form opinions on their own.

A Coach, however, knows that his role is to teach you something so that you can do it yourself. A coach puts you in the best position to succeed.

I know this is mostly semantics. There are amazing consultants out there who really are more like coaches. They teach. They instruct. They help you grow. They never hold back.

Words, however, are important. Choose the right words and your advertising messages will sparkle. Know which words make up your Core Values and your business will attract the right people. I needed to know which word I wanted to use and why before I could be of best service to you.

I chose the word Coach.

If you want one-on-one, private, specialized instruction to learn how to:

Hire Better
Train Better
Serve Your Customers Better
Market Yourself Better
Manage Your Inventory Better
Manage Your Staff Better
Manage Your Cash Flow Better

Let’s get together for an exploratory meeting.

The first meeting is FREE. In that meeting we’ll discuss where you are, what problems you’re facing, what tools you might need to solve those problems, and how best I can help you. After that I’ll send you a few different proposals explaining what I will do, what it will cost, and how we’ll measure success. From there the choice is yours as to how much coaching you want.

While my love is still the stage and I hope to spend as much time there reaching as many people as possible, coaching is the next best way I can help you find your path to success.

-Phil Wrzesinski
www.PhilsForum.com

PS Yes, I do coaching remotely. We’ll use phone and email to get the job done. (Or if you want to fly me out to meet face-to-face, I’ll let you do that, too. The best way to get me to town is to convince your local Chamber or DDA to hire me for a presentation and have them pay my way.)

PPS One thing I will ask of any client who wants my coaching services is for you to know your Core Values. You can download the new, updated worksheets here.

PPPS Yes, you can hire me to do stuff for you, too. I’ll run a Team Building event. I’ll write your Hiring ads. I’ll write your advertising messages. I’ll teach your staff how to sell. I’d rather teach you how to do those things yourself, though. That’s what serves you best in the long run.

April 23, 2018

You’re Looking at Credit Cards Wrong

I was having a recent discussion with a friend about credit card usage. She uses her credit and debit cards almost exclusively. I still prefer cash. Many people think exclusive credit card usage is a young person, Millennial thing. My friend was born on the cusp between Baby Boomers and Gen X.

She isn’t the only person I know who prefers cards over cash. In fact, many smart shoppers prefer to use their cards. They have rewards cards that earn them miles or cash back. Some of my fellow business owners use their cards almost exclusively for their business and go on vacations virtually free.

Credit card usage is the way of the world. It is the way most customers wish to pay you. And with the expansion of Apple Pay and other mobile wallets, that usage is going to continue to increase and become the preferred method of payment not just for Millennials but for all generations. (My son wants me to change banks just because my bank doesn’t yet support Apple Pay.)

Yet many small retailers (and some larger ones) are still stuck in the dark ages when it comes to accepting credit cards.

Yes, you need to accept chip cards. Yes, you need to accept mobile wallet payments. Those are necessary changes in today’s retail climate.

More importantly, you need to check your attitude about accepting credit cards.

I still see retailers who have “minimum charges” for credit cards. If you have that, you’re penny-wise and pound-foolish. You’re telling your customers those few extra cents on that transaction are more important to you than taking care of the customer and serving her the way she wants to be served. You’re telling the customer your needs are greater than hers.

When my friend sees those signs it pisses her off, makes her want to spend less, and makes her not want to come back. Would you rather she comes in once a week to spend $5 or spends zero money and tells people what a horrible store you are?

Heck, even if you allow credit cards for any amount yet you cringe when a customer pulls out her card for a $2 purchase, you need to check your attitude at the door. Swipe fees and percentages are part of the cost of doing business. Period. Unless the majority of your transactions are under $5, those fees are actually quite minimal in the grand scheme of your business. (And if your business does have a lot of $5 and under transactions, you should be making enough margin on your sales to cover those fees quite easily.)

If you want to cringe at a $2 credit card transaction, don’t cringe at the extra pennies you might pay to Visa. Cringe, instead, at the inability of your sales staff to make a larger sale. Cringe, instead, at your lack of connection with the customer that might compel them to buy more. Cringe, instead, at your failure to price things enough to cover your expenses.

Better yet, don’t cringe at all. Celebrate that customer and her purchase. Make her feel as special as the customer who spent $200. Be happy she came in. Be happier that she spent money. Be happiest that you have the chance to build a long-term relationship with her. That is the winning attitude.

You are going to have credit card fees. That is an expected expense in today’s business climate. Your job as a merchant is to make enough money to cover your expenses. Whether you do it through better profit margins or cutting other expenses, your attitude towards those expenses shapes the attitude you have toward your customers.

When you limit how your customers can pay you or simply take an attitude when they pay you in a way that is least convenient for you, you’re taking a business-centric approach. When you have no limits and no worries, you’re taking a customer-centric approach. One leads to smaller average transactions and fewer transactions. One doesn’t. You know the difference.

-Phil Wrzesinski
www.PhilsForum.com

PS The same can be said about whether or not to accept American Express. Yes, you need to accept it … with a smile on your face. You need to be happy when a customer pulls out her Amex instead of her debit card. You need to celebrate the customer, not worry about the fees. You do that by adjusting your margins and expenses to cover it. (As for Bitcoin and other cybercurrencies, because of their volatile nature, you can draw the line there without angering customers. Those of you who do accept cybercurrencies, however, are going to find that you attract a whole new level of clientele that could possibly be quite good for your business.)

PPS Here is the best thing you will read about how to increase your margins enough to cover those credit card expenses.

April 20, 2018

Your Advertising Media Reference Guide

Here are links to the recent posts on how to best use the different advertising media. Like I said before, all advertising works and all advertising doesn’t work. It depends on two factors, how you use the media and what you say (work on that last one first, then pick the media best suited to say it.) You’re going to want to bookmark this page and share it with your fellow business owners. Before you spend a penny on advertising, spend a few minutes reading these posts.

Television – The Super Bowl of Ads: Television is a powerful branding tool and a powerful direct marketing tool. The downside is it is expensive and people spend as much time and energy trying to avoid TV commercials as they do trying to see TV content.

Radio – The Marathoner: Radio works best for long-term branding campaigns. You can reach a lot of people at a reasonable rate. You just need a great copywriter to craft the kind of ads that can get people’s attention. Boring ads that sound like everyone else are where most radio dollars are wasted.

Billboards – The Drive-By Advertising: In terms of eyeballs per dollar, billboards are one of the best values out there … As long as you can tell a heartfelt story in one picture and six words.

Does Newsprint Even Exist Anymore? Even though it has fallen out of favor with most advertisers, newsprint (whether in print or on a screen) advertising can work if you remember to create the ad the same way a journalist creates a story. You need an engaging picture and a killer headline to grab someone’s attention with this passive media.

Magazines – Speaking to the Tribe: Magazines are newsprint without the daily frequency or the large readership. That’s the downside. The upside is that the niche readership of the magazine means their readers are already qualified members of your tribe. Speak their language and win their hearts.

Why Email Works (And When it Doesn’t): One of the more affordable ways to reach your current customer base to get them back into your store. This post includes tips for getting better open rates and more traffic in the store.

Shares, Comments and Likes (How to Get Facebook to Work for You): Social media is exactly that—social! When you learn how to have two-way conversations and how to reach customers in a way that makes them interact, you’ll find the time you spend on social media is finally worthwhile.

Websites – The Silent Salesman: In today’s retail landscape where everyone has the Internet in their pocket, you need a website. Here are some tips for how to build a website worthy of your brand.

Direct Mail – Do the Math: Direct Mail is for Direct Marketing. You need a relevant offer at a relevant time to a relevant audience to make it work. You also need to know the math to see if the ROI is worth it. This post shows you the math.

Yes You Can Buy Word-of-Mouth Advertising: The most effective form of advertising is Word-of-Mouth. It has always been that way. This post shows you where to put your “advertising” money if you want to get people to talk about you.

Google AdWords – Wasted Money or Well Worth It? When you have a great solution and can convince people of that on a single web page, you can get a lot of customers through Google AdWords. If you don’t have a great solution or cannot communicate that solution well, you can blow through a lot of money quickly with little to no effect.

Mobile Marketing – Winning the Transactional Customer Today: Mobile marketing works well for making a Direct Marketing offer, but be careful how you use it. If you have a “deal-of-the-day” or are a restaurant with daily “chef’s specials” it can be highly effective, but as a branding tool, it won’t get the job done.

Movie Ads, Placemats, Yellow Pages, and More: Here are some of those other more obscure and/or obsolete media someone may try to pitch you. Be wary.

If there are other media you are considering that aren’t covered here, let me know. I’d be happy to explore the ideas with you. As always, if you ever have a question about your marketing and advertising, whether it is about your message, your media choice, or anything else, send me an email.

-Phil Wrzesinski
www.PhilsForum.com

PS If none of these forms of advertising are in your budget, go to the Free Resources page and download one of my Marketing on a Shoestring Budget pdf’s. You’ll find a few more tools to throw into your marketing and advertising toolbox.