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Tip Jar - June 2008

June 2008
4 Keys to Maximizing Your Customer Opportunities
By Retail Expert Doug Fleener

Doug Fleener is a veteran of more than 25 years of hands-on retail experience with world-class retailers including Bose Corporation and The Sharper Image. He has also owned and operated his own specialty stores. Doug is the author of The Profitable Retailer: 56 surprisingly simple and effective lessons to boost your sales and profits.  Doug is president and managing partner of Dynamic Experiences Group LLC, a Lexington, MA based retail consulting firm dedicated to helping retailers of all sizes increase their sales and profits.  Learn more about Doug Fleener’s profit building services and products at www.dynamicexperiencesgroup.com.

J.D. Power and Associates recently released their 2008 Wireless Retail Sales Satisfaction Study. Taking a look at it is worth your while whatever you sell.

The customer satisfaction study is based on four factors. In order of importance, they are:

  • Sales staff (51%)
  • Store display (17%)
  • Store facility (16%)
  • Price/promotion (16%)

I'm not surprised the sales staff is three times more important than displays and store facility but it does make one wonder if companies invest their time and resources in that same proportion.

The study finds that while scores have declined in all four factors that drive overall satisfaction, the most notable decreases occur in store display and price/promotion. Customers are particularly dissatisfied with the rebates offered on phones and accessories and with the availability of product and service information.

The key word for all retailers is SIMPLE. Make it simple for your customers to understand your offer. Make it simple for your customers to decide what to buy. Make it simple for your customers to purchase the product. And finally, make it simple for your customers to get their promotional prices, rebates, etc.

The one other thing that stands out in this study is that retail satisfaction is 15 percent lower among customers who report they were pressured during the sales process. The average overall satisfaction rating among customers who report experiencing no sales pressure is 721 compared with an average of only 610 among those who say they were pressured. A challenge is defining precisely what customers consider pressure and what employees see as pressure. While an employee may make a sale, if they pressure the customer too much during the process they may lose future purchases. But failing to be sales focused can lead to even worse experiences for customers and lost opportunity for the retailer.

Here are some ways for retailers to maximize their customer opportunities without causing customers to feel too pressured.

  1. Smile and welcome your customers when they come into your store. Shoppers feel pressured when they are pounced on by salespeople and given too much help when they first walk in the door. A warm welcome and a genuine smile go a long way toward making your customer feel comfortable.
      
  2. Don't suggest any products until you have a good understanding of your customer's needs and wants. While this sounds very basic, some retail associates never ask a shopper anything beyond "May I help you." Selling a product without knowing anything about your customer results in either the customer feeling overly pressured or a sale for your competitor.
      
  3. Always tell your customer the reason you are showing a product or suggesting a service. Obviously it's important that customers not be shown something they don't need but just as important is telling them why the product you are showing does meet their needs. Customers feel pressured when they are told or asked to buy something for which they don't see a need. Always refer back to what you learned when discovering their needs and wants.
      
  4. Stop showing products when the customer is ready to go. I know a lot of people believe you should try to overcome the first resistance but how often do you really sell customers additional products when they are ready to leave? And even if you do, at what cost to the customer satisfaction of other buyers?

If our number one goal is to deliver a great experience to our customer and our second goal is to match them up with products that meet their needs and wants, the only way they'll feel pressure is because the bags they are carrying out the door are so loaded down.

So let me ask, are you maximizing every customer opportunity without making your customers feel pressured?

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