Do you feel beat up over price? Does the business news turn your stomach into knots as you read about department stores like Younker’s going out of business and Sears and Macy’s doing another round of closures? Does it make you cringe every time you hear that Dollar General has opened a new store? Do you want to curl up in the fetal position every time Amazon has a Prime Day?
The retail economists look at all that news and keep coming to the same conclusion …
Price drives all retail.
They are missing the true picture. Price is not the driver.
In the absence of everything else, Price is the Default.
At 3:01am EDST Apple opened up pre-orders of their new lineup of iPhones they introduced two days earlier. These phones cost more than the computer I use to write this blog. Yet the early adopters were up and ordering their new phones at full retail prices.
Apple gets what so many retailer do not. There are tons of customers out there willing to shop for some reason other than price. The reason they don’t is that too many stores have given up on giving them something else.
I just read a report that department stores, long mired in a slump, are spending more on television ads this coming fall. It also talked about their other strategies to turn their ships around that included supply chain and inventory management improvements.
Nowhere in the article did it say anything about investing in employees and employee training. Nowhere were the words (albeit overused) Customer Service, Customer Experience, or Sales Training. Nowhere was there a discussion of spending more to surprise and delight customers. The article went on to say that modest growth based on the already growing consumer spending in the US was about the best they could hope for.
Do you know why the traditional department stores are struggling? They have cut their staff and their training back so far that they are just over-priced versions of their competitors. Target, TJ Maxx, Marshall’s, and other stores like them now have pretty much all the same stuff with the exact same levels of non-existent service as the traditional department stores, but at lower prices.
According to the same article about their TV spending, the only department store mentioned that has a chance of truly thriving is Nordstrom’s. Yeah, the only store still focused on customer service.
There was a survey done by National Retailer Federation during the Great Recession. When asked what would drive people’s decisions where to shop, 41% said “deals and discounts” and another 12% said “everyday low pricing.” That only adds up to 53% of the population. Another 47%—almost half—said something other than price would drive them during a time where money was tight.
Today’s economy isn’t that tight. Although price has become default for more and more customers—mainly because of the lack of service out there—there are still well over 40% of the population that would choose a store for reasons other than price … if they were given that option.
That’s why I am pushing The Ultimate Selling Workshop so hard this fall. You could spend the $2,000 on advertising and maybe drive in a few more shoppers this season, especially if your prices are sharp enough. Or you could up the game of your sales staff, increase average tickets, increase loyalty (without just giving bounceback coupons or discounts), increase word-of-mouth advertising, increase repeat business, and increase referral business not only this season, but going forward into 2019.
Your holiday ads end with the holidays but Sales Training is the gift that keeps on giving.
Millennials are more open to shopping local than any generation before them. They also shop completely differently than any generation before them. Reaching them through advertising and marketing is only half the problem. You also have to know how to sell to them. You’ll learn how in The Ultimate Selling Workshop.
Don’t be a Default retailer. Change your settings to Surprise and Delight. There are a lot of customers who would choose you if given the chance. Call or email me today.
PS Last year over 100 million people went to Toys R Us even though Walmart had consistently lower prices and Amazon had a much larger selection. Those 100 million customers went for some other reason. If they can draw that kind of business by offering a better “experience,” you have the opportunity to draw some amazing crowds, considering I am sure you can offer an even better experience than any chain store out there. (By the way, just for clarification, Toys R Us went under because of heavy debt load caused by their greedy venture capitalist owners borrowing money for themselves against the company. They were profitable, but not profitable enough to pay the massive interest on their debt.)
PPS If you aren’t convinced yet of the Value of The Ultimate Selling Workshop, next week we’ll do the math.