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Discounting Question…

I had an interesting debate with the president of a baby product company here at the ABC Spring Conference in Louisville.

His company has a minimum ad price to help protect the integrity of his brand (and keep the low-overhead Internet dealers from discounting so much that the brick & mortar stores drop the product). But lately he has relaxed that policy, because as he puts it, “In this economy we felt we needed to give some relief to the consumers and not have such a high gap between our prices and our competitors’ products.”

So my question to him was, “If you’re so concerned about your prices and giving the customers some relief, why does it have to come out of MY pocket and not yours?”

Still waiting on the answer…

But, at least I’ll give him credit for this. He stood up in front of a room of 300+ brick & mortar retailers of his product and said that the decision was completely his and he wasn’t going to change it until the economy improved. That took some serious guts.

Is there a lesson in this? Stick to your guns and hold your resolve in the face of adversity? Be prepared to answer your critics? It’s not a good gesture unless you share in the pain?

I’ll let you decide.

-Phil

PS We didn’t do the discounting. It’s a premium brand that doesn’t need discounts to sell, just good, smart sales people who know the value of the product. Oh yeah, our sales are up 28% with them ytd.

Doing December Differently

(Note: I know it’s already December 6th. For some of you it might seem like too little too late. But the advice is good and I didn’t want to wait 11 months before sharing it.)

Today’s sermon from Pastor Dr. James Hegedus at the First Presbyterian Church of Jackson was about “Doing December Differently.” Would it surprise you to learn that pastors take the same approach to December as retailers?

As Pastor Jim put it, “I turned the page on the calendar and sucked all the oxygen out of the room.”

Yes, big, deep sighs as we brace ourselves for the onslaught of the busy season.

Pastor Jim went on to talk about how he is preparing his way for the Lord differently this year. As retailers we need to think about how we prepare, too. Here are three things I encourage you to do differently this December.

  1. Schedule some white space
  2. Empower your staff
  3. Focus on one customer at a time

The hardest thing we face in December is the way everything seems to grow and speed up exponentially. The fires to put out, the to-do lists, and the pace of business whirl around faster and faster until we are sucked into the stress and craziness of the season. Soon we aren’t eating or sleeping well, we’re losing our patience faster and we become a different person than we were the other 11 months of the year. I know. Been there, done that.

But it doesn’t have to be that way. You don’t have to take a deep sigh as though holding your breath while you plunge into the icy waters of December. You just have to do things a little differently.

Do these three things and it will make a huge difference in how well you feel (and how well you do) at the end of December.

Schedule some white space. Just as the white space in a newsprint ad makes the message stand out more powerfully, white space in your life makes you more powerful. Schedule at least 30 minutes per day for quiet time. Use it to read, write or reflect, but don’t use it for anything relating to your business. It will recharge your batteries and give you a fresh outlook on your life and your business.

Empower your people. Teach your employees how to do what you do and let them do it. Reward and praise them when they do it right. If they do it wrong, first support them, then show them how to do it right. Soon they will be doing more so that you can do less. Will they do it as well as you? Probably not at first. But if you’re rewarding their behavior, they’ll do it well enough to make a difference. And you’ll immediately have more time on your plate.

Focus on one customer at a time. As the boss it is hard not to look and listen to everything happening around you. But the more you can learn to focus on one customer at a time, the more the world slows down for you and the bigger impact you can have on that one customer. Give her your full attention and win her over as a fan. She deserves nothing but your best. And don’t worry about those waiting customers. When they see you giving your all to one customer, they’ll want some of that kind of service, too.

Do things a little differently this December. Give yourself a break. Empower your staff. And take it one customer at a time. You’ll see the results before the champagne pops New Year’s Eve.

Merry Christmas!

-Phil

The Three People to Solve the Problem

If you’re in retail, at some point you will have a customer with a problem. And your success will depend on how well you solve that problem in the customer’s eye.

The key is knowing the three people who can solve the problem. Those people are (in no particular order):

  • The person Most Capable of solving the problem
  • The person Closest to the problem
  • The person Least Busy at the time of the problem

The problem for most businesses is the order in which we prioritize that list. From a business owner’s standpoint the ideal priority would be:

  1. Most Capable
  2. Least Busy
  3. Closest

From a customer’s point of view, however, the order would be:

  1. Closest
  2. Least Busy

Notice that I left off “Most Capable”. The customer expects that everyone will be Most Capable. And that’s where the smart retailers succeed. They equip their front line staff with the tools to solve problems so that customers get satisfaction right from the start.

There is nothing more frustrating to a customer who already walked through the door loaded for bear than having to wait around while incompetent fools run off in search of an already over-worked manager to approve a return or refund or some other simple issue.

Conversely, there is nothing so satisfying as a customer than having the first person who greets you being able to fully take care of your problem.

The best thing you can do for your staff is walk them through the basic problems that arise in your business. Show them your thought process and the criteria you use to make decisions. Then empower them to make those same decisions for the customers.

Sure, they might make a mistake or two. Sit down with them when they do and talk through their decision-making to see their process. Use that time to show them (again) how you would handle it. The good ones on your staff will get it quickly. Plus, they’ll feel more ownership for the satisfaction of the customers in the first place.

There will still be a time when the person closest to the situation can’t solve the problem. But the more often they can, the better your customers will feel about you and your business.

And isn’t that the whole point?

-Phil

A Coach and a Leader

My son’s little league team lost in the playoffs last night. It was amazing they even made it that far. This was a team of castoffs from the start.

Four weeks after practice began and two games into the season, a few kids had been mistakenly left off teams. Rather than add them to existing teams, the league found a coach and created a new team by drafting kids from other clubs. No one would admit it, but since each existing team had coaches’ sons and hand-picked friends, the kids drafted (including my son) were the 7th best kid or worse from their respective teams.

With little practice time and no printed schedule for the first three weeks, Coach Johnson did the best he could to figure out what he had and build some sort of team. In their first week of games, little Noah, one of the smallest kids in the league was hit by a pitch two or three times. It took every ounce of courage and every word of encouragement from his coach for him to even step back in the batter’s box. In their third game, they lost 14-3 in 4 innings to one of the premier teams in the league – victims of the mercy rule that only allowed 5 runs per inning.

There were issues with the rules. Coach Johnson was given one set of rules. Apparently other coaches had decided to use different rules, and the umps seemed to have a rulebook of their own.

Still, through encouraging words, never allowing his kids to feel like castoffs, Coach Johnson crafted them into a team that could win. Even without a true pitcher, they won enough to make the playoffs and face one of the three teams that had mercied them earlier in the season.

And they won!

But last Thursday they went up against the #1 ranked team that had beaten them 14-3 earlier, a team loaded with all-star 10-yr olds instead of a mix of 8 to 10 yr olds that other teams had.

For two innings neither team could score. In the 3rd my son’s team took a 2 run lead that they held until the bottom of the 5th. The game entered the 6th and final inning all tied at 2. With two outs in the top of the 6th, our last chance was little Noah. The dugout was cheering him on, knowing that a walk was probably the best they could hope. Noah had barely stayed in the batter’s box, let alone actually swung at a pitch. This time, with teeth gritted, Noah did stand in there and swung with all his might. The bat met the ball with a force that shook little Noah to his toes. But he held strong and watched the ball head sharply toward right field.

The players in the dugout jumped to their feet urging Noah to run. The crowd was cheeringly loudly. The noise was deafening, louder than at any other point in the game. Little Noah’s legs churned as fast as they could.

The first baseman, unaffected by the cacophony of crowd noises, calmy scooped up the grounder, took two steps towards first base and made the out, with Noah still 15 feet away.

But there was no groan from the crowd nor the dugout. No moans at the lost chance, no ‘aw shucks’ or ‘too bad’. The cheering continued. And continued. Noah was given a hero’s welcome as he returned. Every player slapped him a congrats on his helmet as they headed out to the field for the fateful bottom of the 6th. Coach Johnson had taught these boys that there were things more important than hits and outs.

Even the cheers from the crowd of parents who had witnessed Noah’s trials from the beginning never abated. His parents were given high fives and pats on the back as he jogged out to right field.

One batter later, however, the game was over. A missed call by the ump, some intimidation by the opposing coach, and a couple of bad throws ended the game 3-2. But there were no losers in this game. Coach Johnson wouldn’t let it happen. After the game and the obligatory handshake, he called his team together.

At the end of the season each player gets a free coupon for a Pizza Hut pizza. But Coach Johnson went one step further. He didn’t call it a gift or freebie, he called it an Award. Before he handed each kid his coupon, he called them up and explained why they were getting this award. He talked about each kid and his contribution to the team. He talked about the energy and can-do attitudes they brought to the season. He talked about their desire to never quit. He talked about determination and always holding your head high. By the time he talked about Noah, there wasn’t a dry eye in the crowd, parents and kids alike.

Coach Johnson coaches whatever sport needs to be coached. He already had a travel basketball team when they called him to coach little league. And now he’s running practices for a summer football team. He asked my son, who is big for his age, if he would like to play football this summer. My son, who does not like physical contact at all, actually gave it some consideration. Why? Two words… Coach Johnson.

I had my doubts on this season. My son was on one of the best teams to start the year, great coaches, great players and great parents. I sat through two nights of tears when he found out he was drafted to the new team. I had my reservations watching the first practice and seeing the lack of talent. And when Parker’s old team mercied them early in the season, I sat through another night of tears.

But after last night, I can honestly say I’m glad it worked out the way it did. And my son would agree. He still wants to go the final game to cheer on his old team, but he has no regrets for how his season turned out, except maybe that strikeout in the 5th inning.

There are coaches and there are leaders. This summer, a group of 8 to 10 year old castoffs got both. And I doubt any one of them will forget it. My son and I certainly won’t.

Thanks, Coach Johnson, for making this season special.

Coaches teach the basic skills, leaders teach the important lessons of life.

Question… Are you coaching or are you leading?

Courage to Lead

I ran across these two videos on Leadership on a blog by Mike Rogers. Different styles (one is a movie excerpt), but similar messages.

Running a business requires leadership and leadership requires courage – the courage to go on when you’re afraid.

By the way, you might want to get the tissue before you click the links. I watched the first one with my wife. When it started, she asked, “I’m not gonna be upset by this, am I?” She wasn’t upset, just moved to tears (me, too).

http://www.teamworkandleadership.com/2009/05/free-inspirational-leadership-video-story.html

http://www.teamworkandleadership.com/2009/05/get-the-very-best-a-very-inspirational-leadership-video-clip.html

Thanks for the videos, Mike!

-Phil