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Shopping Local Benefits Salt Lake City

More good news!  Another study has come out showing the HUGE economic benefits of shopping local.

http://www.ilsr.org/independent-businesse-deliver-bigger-economic-benefit/

(For those of you who either can’t or won’t follow the link, the gist of the story is that a study of impact on the local economy in Salt Lake City showed that local retailers recirculate about 52% of their revenue back into the city, whereas chains only recirculate about 13.6%.  For local restaurants it is 79% versus 30% for chain restaurants.)

Shop local.  It helps your local economy.  Remind your customers to shop local, too.  In fact, remind everyone to shop local.  That is the easiest way to turn this country around.

(Gee, wouldn’t it be nice to hear at least one politician put that into his platform?)

-Phil Wrzesinski
www.PhilsForum.com

PS  But don’t think that those economic benefits alone mean that you deserve people’s business.  You still need to perform.  All this means is people should try you first.  It is up to you to get them to come back.

Wild Caught Shrimp

I’m writing to you from Amelia Island, Florida near Jacksonville.  Took the wife and kids on vacation.  This morning we went on an Eco Tour and learned about the shrimping industry.  We took a ferry boat through the inter-coastal waterways and with the help of Andrea, our marine biologist, and Captain Sean, did some trawling.  We caught a sting ray, a butterfly ray, a couple blue crabs, some flounder, a tongue fish, two squid, and a whole bunch of shrimp.

At one point Fernandina Beach on Amelia Island was the shrimp capital of North America with over 3 million pounds of shrimp caught annually. There used to be 150 shrimp boats parked off the pier.  Today only five working shrimp boats remain. (Gee, sound like any other industries you know?)

The vast majority of shrimp sold in supermarkets is grown in gigantic shrimp farms – many located in China.  It isn’t that there aren’t shrimp available in these waters.  No one seems willing to pay the extra dollar or two per pound to eat wild caught shrimp.  Captain Sean says these waters could still support 3 million pounds of shrimp annually.

He should know.  He grew up in the area and still fishes these waters.  He promises that if you ever ate the wild caught shrimp and farm-grown shimp side by side, you would throw out the farm-grown shrimp immediately.  He is that sure of it.  And he believes with all his heart that the shrimping industry would come back if people did a taste test.

Would you pay a dollar or two more per pound for wild caught shrimp?  What if it did taste better?

What reason are you giving your customers to pay a dollar or two more in your store?  Does it “taste” better?

If not, you have some work to do.  If so, you just need to convince the public.

-Phil Wrzesinski
www.PhilsForum.com

PS Look for wild caught shrimp next time you’re buying shrimp in the market.  Try it, you’ll like it.  I trust Captain Sean.

Two Ways to Look at the Amazon Deal

Amazon announced it is offering up to a $5 incentive for someone to walk out of a brick & mortar retailer this Saturday and shop online.

Facebook and blogs are lighting up on this topic.

Retailers are obviously outraged by Amazon’s blatant attempt to use their stores as free showrooms.

Before you get your panties in a bind, however, here are two different ways to look at this…

IT DOESN’T REALLY MATTER

Statistics show that about 35% of the US population uses a smart phone. And only a quarter of those people use it for primary browsing purposes.

So now we are down to only 8.75% of the population are likely to use their mobile phone for this purpose. Now figure out how many of those have that Amazon price check app. Let’s be generous and say that 80% of those people have the app. Now we are down to 7% of the population.

It has been shown before that only about half the population are price shoppers, which gets us down to 3.5%. Then figure out your share of the market. 5%? 10%?

Assuming you are rocking it in your market and have 10% market share, then you can expect about 0.35% of your customers to be using such an app.

But wait, you say. Many of your customers are early adopters. They make up a higher percentage of the smart phone owners. Yes, but at the same time, a larger percentage of your customers are not price shoppers. So it is a wash.

Bottom line? Do the math and you will see that about 1 out of every 225 customers in your store this Saturday will take advantage of this offer.

KILL ‘EM WITH KINDNESS

And when that customer does pull out her phone and zap an item, you get a unique opportunity. You get the chance to show her how wonderful and helpful your store is.

As long as you approach it the right way.

She is zapping for information. Not just price but also product specs and reviews. You can win her over by also being a knowledgeable font of information.

Help her understand if the item is right for her needs by asking important questions like, “What are you hoping this item will do for you? What problem are you trying to solve?”

Embrace the information she finds online. Ask her to share what she reads. Quite often you will find that the information is either faulty or useless. Then you have the opportunity to engage with her and steer her straight.

It is all about winning the customer’s trust. You do that by being friendly, honest and open. You do that by acknowledging the downside to a product. You do that by showing the upside, too, the benefits of shopping with you and keeping your purchases local. You do that by understanding the customer is a person with needs and fears just like you. Find out what is her fear and you know how to build her trust.

Heck, you don’t need to wait for them to use a smart phone app before you do all that.

Just saying…

-Phil Wrzesinski
www.PhilsForum.com

PS If you feel the need, you can always play the Amazon-doesn’t-care-about-the-local-community card. Just ask your customers how much Amazon contributed to the fire and police departments in your town. But the best approach is to not worry at all. Just do what you do so well that your customers want to support you.

Educating the Customer

Most independent retailers fully understand the impact of a customer coming into your store, browsing all the aisles, asking questions, getting information, then walking out and buying the item online.

We know how that action, beyond killing your own business, is also eroding the local workforce, the local tax base, and the local economy. We know how our own communities are struggling to make ends meet, how police & fire departments are being gutted, how budgets for schools and education are being slashed.

We know how tough it is to pay your sales people to be a showroom for some out-of-town, faceless Internet site. It demoralizes the staff to do all that work and not get the sale. And they know that without the sale you won’t be able to pay them for much longer.

We get all that.

The customer doesn’t.

There are only two reasons for this. The customer doesn’t know or the customer doesn’t care.

The Customer Doesn’t Know
One way we have failed our customers is by not letting them know the positive impact they make on our community when they shop with us. We have not educated them that they are supporting jobs in their neighborhood, they are supporting the tax base that pays for their protection and their education and they are making the community stronger when they shop local.

The best way to educate our customers is one at a time. Thank each and every customer who chooses to shop with you for making a positive impact in your community. Engage each customer with a positive message about how together you are making your town a better place to live.

If you choose to post any messages, either on your website, Facebook, in your advertisements, or in the store, make sure they are positive about all you (and they) can do to make the quality of life in your area better.

The Customer Doesn’t Care
But do remember that the message, no matter how positive, will not resonate with everyone. Most of your customers are too absorbed in their own worries and cares to even give a single thought to the impact of their decisions. Don’t lose sleep over them.

Just remember to always keep your message positive. A positive message may not change the mind of these customers, but a negative one will make them feel bad about your store – something you never want to do.

Most retailers get it. Most customers do not. We have a lot of work to do. Just keep it positive.

-Phil Wrzesinski
www.PhilsForum.com

PS One way to make the message positive… “Thank You for Shopping Local. Today you made our city a better place to live.” At its best, it will get customers to engage you in conversation. If nothing else, it will make them feel good about shopping with you. And that is always a good thing.

PPS But if you use that phrase, you better back it up. Pay your staff more than your competitors. Give more to your local non-profits. And get involved in your community. It is a two-way street after all.

Don’t Bring Me Down

At the trailer on the Manistee River where my family spent many a summer vacation there was a printed piece of fabric full of cliches. I loved reading those phrases and spent many a night asking my dad to explain what they meant.

One of my favorites was “Before you run in double harness, look well to the other horse.”

There is a reason we haven’t done a lot of collaboration marketing and promotions. Quite often the other horse wasn’t up to our speed. We weren’t willing to use (lose) our reputation because of an inferior partner.

We are All in Double Harness
The Shop Local movement has challenged all that. To get the benefits of a Shop Local campaign we have to allow ourselves to be defined under the umbrella of all local businesses. We have to allow ourselves to be defined by the local florist, the local shoe store, the local tailor, and many other businesses over which we have no influence or control.

That’s scary.

Especially when I read stories about local retailers failing their customers like this one by Rick Segal, this one by Cinda Baxter or this one by Bob Phibbs.

I’m not sure I want to run in harness with all those other businesses.

At the same time, however, I really don’t have a choice. The Shop Local movement is here to stay, whether it gains a lot of momentum in our area or not. We also face the issue of being defined as a downtown business, so I’m lumped in with all other downtown businesses and the perceptions they are giving customers (good or bad). And I’m a specialty toy retailer and specialty baby product retailer.

That’s a lot of horses tied together. And if we all run well, we can travel far. But if we don’t…

I’m Counting on You, You’re Counting on Me
We are in double harness whether we like it or not. And it raises the stakes for all of us. Not only do we have to do right by the customer for our own sake, we have to do it for every other retail channel we represent.

Makes you realize that more customer service training isn’t such a bad idea after all.

-Phil

Neighborhood Kids Causing Trouble? Involve Them in Your Business

My grandfather served on the USS Arkansas Battleship in WWII. Fought at D-Day and Okinawa. Shortly after the war, with three kids and nowhere in town to go for toys, he opened our store.

The original Toy House was not in the best shopping location, but rent was cheap on the edge of downtown near the residential neighborhoods.

One of his friends told him, “Phil, you’re crazy for going there. The neighborhood kids will vandalize the heck out of your store… when they’re not in shoplifting you blind.”

Oh, my grandfather was crazy. Crazy like a fox.

Every morning he raised the flag outside the store. Every evening he lowered the flag. And he did it with all the pride and honor of a decorated WWII veteran. Oh yeah, and he included all the neighborhood kids in the routine. Taught them how to say the Pledge of Allegiance, how to stand at attention and salute, how to fold the flag and pay it respect. Showed them how to raise the flag quickly and lower it slowly. A true adolescent color guard.

At first there were a couple kids involved. Then a few of their friends joined in. Pretty soon it was a small crowd of young patriots standing at attention with their hands over the hearts.

Vandalism? Never a problem. Shoplifting? Are you kidding? He had an army of young men that took pride in the success of Toy House. No one was going to hurt the store on their watch.

How are you reaching out to your community and getting them to stand behind your store?

-Phil

What Difference Did You Make?

Sometimes we forget the impact we have. And this time I’m not talking about the social impact of the products we sell. I’m talking about money. Pure cold hard cash.

Do me a favor… Go read this article .
I’ll wait…

Think about the billions of dollars of economic impact that one company has had on the world.

Now think about your own.

There have been studies that say a dollar spent in a local independent retailer circulates seven times through the community. Some have put it as high as fourteen times. Others question if seven is too high. But none dispute the facts that the money spent in your store goes around the community more than once.

So let’s use lucky number 7. Take your gross sales for the year and multiply it times 7.

That is the impact you had on your local economy.

That money allowed families in your town to keep their homes, feed themselves, and buy clothes. That money sent kids to college so they could learn to solve future problems. That money plowed the snow on your streets, sent firemen to rescue old Mrs. Hodges, and helped the police make the biggest drug bust in a decade.

That money maintained the park where your kids play, helped your dentist buy a better, safer x-ray machine. That money kept two kids out of jail because they got an allowance from their employed parents.

Sometimes when you look at your business, good or bad, you wonder what it’s all worth. As you reflect on 2010 know this… it’s worth more than you originally thought!

Happy New Year !

-Phil

Doing a Charity Event Right

We just hosted a fundraiser with our local radio stations for Toys for Tots in Jackson yesterday morning. We raised over $6500 in donations of money & toys and all that money was quickly turned into sales at our store. For a one-day event in a market like ours, that was a pretty good day.

In fact, it was a win-win-win. Toys for Tots won because of the incredible exposure and the huge outpouring of the community (not to mention $6500 worth of toys). We won because of the incredible exposure and the $6500 in sales. The kids won because we made a major impact on not just the quantity of toys they will receive but also the quality.

Using a charity as a way to draw traffic is a huge marketing tool. Here is a how-to:

Find a Charity
First, you need to find an appropriate charity. We chose Toys for Tots because we sell toys. If you sell coats, line up with a Warm the Kids campaign. If you sell eyewear, contact the local Lion’s Club. Somewhere there is a charitable group that needs what you sell.

Then meet with the coordinator for your local organization. See if he/she has a radio station that is willing to support them. Local AM talk-radio stations are good for this. Their listeners include lots of business people and community-minded people who are more willing to support local causes.

Plan an Event
Next, have the charity contact the radio station to plan a morning event at your store. For our event we had both the AM and FM stations do their morning shows from our store 6am to 9am. They read the news, announced the weather and talked about the charity all morning long while encouraging people to come to our store or make donations by phone.

But be sure to have the charity make this call. Since they are a charity, they are more likely to get the radio station to do the promotion for free on their behalf. You just happen to be the location of the event.

After that, contact your local bakery and local coffee house. They might be willing to donate coffee & donuts for the free plugs on the air. If not, still support them and buy a few dozen donuts and brew a full pot of coffee. Get some OJ for the kids and non-coffee drinkers.

Set up an Account
Then set up a special account for the charity. That way you can take donations all year long. If someone wants to “tip” you, encourage them to instead make a donation to the charity through you. We actually raised over $500 this way in the past year. (Note: make sure your bank will accept checks from you that are made out to the charity.)

When you have your event date, promote the heck out of it through your own channels, too. FB, website, email, etc. The radio station usually talks about events like this on the air for about a week prior. You should spend at least a week or more promoting it too. Send out press releases. Call/email your favorite reporters.

Be Gracious
And finally, when you get the chance to be on the air, remember to make it all about the charity, Thank everyone who makes a donation. Shout-outs are great, especially when they are community leaders. We had half of our city commission come in this year so on the air we challenged the other half to step up – and they did! Our DDA director showed up minutes later to make a donation, afraid that he would be called out next.

Teaming up with charities is always a positive. It also makes your staff feel good. And at the end of the day, not only will you have done something wonderful for the community that benefited you, too, you will have created a perception of your business as the experts in town.

Merry Christmas!

-Phil

PS Email me if you want more details of what we did.

Field of Dreams

“If you build it, he will come.” -Shoeless Joe Jackson, Field of Dreams

Great movie. Bad advice for business.

Yet too many independents start out that way, thinking all they have to do is build a wonderful little shop and people will climb all over themselves to get in and give them money.

Roy H. Williams said, “If making a profit were easy, everyone would be doing it.” But not everyone is making a profit. Those who aren’t making a profit are closing their doors. And the first complaint out of their mouth is that they didn’t get enough traffic, followed quickly by the blame…

  • The downtown doesn’t have enough parking.
  • The Buy Local campaign didn’t advertise me enough.
  • The city didn’t support me.
  • The newspaper wouldn’t write a story about our opening.
  • There just aren’t enough people in the area.
  • No one knew about me because of the sign ordinance.
  • Unemployment is too high.
  • People are too cheap.

You know somebody who has made one of these statements. Heck, you probably have thought one or two of them.

Yet there are businesses thriving in hard-hit downtowns, thriving in high unemployment locales, thriving in spite of a lack of support from government, the newspaper, or a Buy Local campaign, thriving without coupons, discounts or cheap products.

You Have To Market Yourself
One of the biggest things they are doing differently is Marketing. Just building a store is not enough. We are over-retailed as it is. The most successful businesses are making a conscious choice to actively and creatively market themselves to the public. They are creating marketing messages, marketing plans, and mapping out new and unique ways to attract customers.

You Can Afford It
And it doesn’t cost as much as you think. There are many ways to advertise your business spending primarily time, not money. You can learn seven of them by downloading my FREE eBook Main Street Marketing on a Shoestring Budget.

And if you have the money to spend, before you drop a dime get to know how the different advertising mediums work with two more FREE eBooks – How Ads Work Part 1 and How Ads Work Part 2.

The movie is wonderful. But it is just a movie. In real life the quote is:

If you Market it, they will come.

-Phil

Don’t Alienate Your Fans

At the Michigan Downtown Conference two speakers talked about sign ordinances. The first was Sheila Bashiri, City Planner from the city of Birmingham, MI, a well-to-do suburb of Detroit nestled in amongst the other wealthy suburbs.

Because Of or In Spite Of?
Birmingham has the most strict sign ordinance in Michigan, so strict that some of the slides Sheila showed us of attractive signage wouldn’t even be allowed in her city. Yet many retailers want to be part of that bustling downtown. And Sheila claimed that her sign ordinance was a main reason for their success.

I guess the dense population of millionaires is only a secondary cause of the businesses thriving there.

The next speaker, Robert Gibbs, mentioned how much he liked the Birmingham sign ordinance and how all communities should adopt it for their business districts. In a private conversation afterwards, he went so far as to tell me that all existing businesses in those districts should be given 5 years to change their signs or move out.

Does he really believe Frankenmuth should tell Bronner’s and their two million visitors a year to take down the billboards or get the f*** out? Or that Ann Arbor should give Zingerman’s a remove the ugly trailer and all that neon outside the Roadhouse or else ultimatum? Hugely successful, yet eccentric retailers are what give our cities their character.

Businesses do not thrive because of sign ordinances. They thrive in spite of them because the city has the population base to support them and the stores are taking care of that population. Period. End of story. Sure, a well-crafted sign ordinance can give a city a uniform characteristic and look, but that does not draw traffic or grow business. The stores draw the traffic because of who they are and what they do. And signs are what help you find those stores.

It is no wonder that most downtowns are struggling. There is a huge disconnect between the city leaders/planners and the businesses that pay their taxes. Both of these speakers advocated not having businesses in the discussion for things like sign ordinances. Both believed that only city leaders should make decisions on what they want their business district to be.

A Business Lesson
That would be the same as you not listening to your customers. You wouldn’t do that would you? Of course not! You will value some customers’ opinions more than others. But if you aren’t listening to your best customers, they won’t be your best customers for long.

Don’t make the mistake others are making. Listen to your best customers. Include them in your plans. Not only will you make better plans because of it, you’ll empower those same customers to become evangelists for your business. By giving them a say in the matter, they will be your strongest advocates, and give you incredible word-of-mouth exposure.

Not everyone has an unlimited supply of millionaires. Take care of those who are taking care of you. That’s a lesson for retailers and for cities.

-Phil