Retail Contrarian

Start a Customer Service War!

Walmart, Target, and Amazon.com have spent the last few weeks locked in an ever-escalating price war. Although consumers may be short-term winners in the price war, the long-term cost of selling products below cost will be high – impacting other retailers, authors, studios, and other companies associated with the products.

Forget price wars: I want to see a Customer Service war.  I want to see companies try to one-up each other over who can deliver the best service.  Instead of dropping prices by a penny, add another something you do for the customer.

Of course the big discounters will never do this because they don't really focus on service.  It's not their competitive advantage.  But it is the competitive advantage for specialty and independent stores. Shouldn't they be starting a Customer Service war?  As a matter of fact, shouldn't you be starting one every day?

To win the war you obviously have to be better and more consistent than the competition. Here are some things you might be able to declare:

• We warmly welcome every customer. We're happy you've come to our store and it shows.
• We treat customers like old friends.  Many of you are.
• We call customers by name and are happy when they know ours.
• We make our customers comfortable by sometimes serving drinks and snacks.
• We understand our customers needs and wants before we recommend products.
• We provide a great experience for the entire family, including the children. 
• We offer unique and interesting products at competitive prices.
• All of our employees are product experts.  More importantly, our employees are customer experts. You won't find a better staff anywhere.
• Our store is fun. One thing you'll always find in stock is a smile.
• We make shopping easy. The same holds true for returns and exchanges.
• We offer special touches that our competition doesn't.  This might include free seminars, free gift-wrapping, special delivery, charitable events, etc.
• Our checkout process is fast and efficient, but more important it's enjoyable.
• We're thankful for our customers and we prove it with thank you cards, follow-up calls, and invitations to future events.
• No matter how busy the store, our employees are able to work with multiple customers and still give individual service.  It's an art and we're good at it.
• We understand that we're not going to be a customer's only retailer but we'll do whatever it takes to be their favorite retailer.

I say let the big box stores duke it out over who can sell the farthest below cost.  That's a war that none of us can ever win and unless you're Walmart, Target or Amazon you'll be a big loser if you try.

Win the Customer Service war.  That's a war worth fighting.

So let me ask, would you win the Customer Service war in your area?  Isn't it time you declare war?

Doug

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Dynamic Experiences Group, LLC helps retailers and other companies improve their on-floor performance.

There are four ways we do that:

1. Work with organizations to deliver more engaging and profitable customer experiences.
2. Help managers and owners to become better leaders.
3. Coach owners and executives to improve their companies.
4. Present engaging and high-energy high-impact programs and keynotes to educate and motivate audiences.

Contact us to learn how we can help you transform your business or meetings.

Four Words That Will Transform Your Business

On Saturday afternoon we had a family outing to Wrentham Premium Outlet Center to buy some clothes and shoes for our daughters.  The place was packed. The line of cars to get into the center was backed up on to the highway from both directions.
 
All I could think was "look at all these opportunities."  It was enough to make my retail heart go pitter-patter.  Judging from the number of bags in people's hands I would say that most stores had a good day.  Some might have even had a great day.
 
But if my experience was like most customers, the stores that had a good day could have had a great day, and the stores that had a great day could have had an extraordinary day - if they had remembered these four simple words:
 
Maximize every customer opportunity.
 
Knowing how to greet and engage customers doesn't matter if you don't do it with every customer.
 
The ability to help customers make informed decisions about the latest fashions or a product's features and benefits doesn't matter if you don't do it with every customer.
 
Recommending additional products that will enhance a customer's purchase and his/her life doesn't matter if you don't do it with every customer.
 
Having fabulous new products or incredible sale doesn't matter if people don't know about them. Sure, you can post signs to that effect but nothing reinforces the message more than an employee enthusiastically telling me about them.  But it doesn't matter if you don't do it with every customer.
 
Lots of store traffic is a wonderful thing but you leave money on the table if you don't maximize every customer opportunity.
 
Maximizing every customer opportunity sounds simple but if it were that easy, more retailers would be doing it.  I'd say that fewer than 10% of specialty retailers maximize every customer opportunity.
 
I'm not saying this to be negative but quite the opposite.  It's exciting because I see incredible opportunity for retailers like you if you make maximizing every customer opportunity the foundation of what you do.
 
Almost all retailers talk about how important customers are.  Very few stress how important every customer is and the impact that has on business.
 
Look at the difference.
 
Welcome and engage customers.
Welcome and engage every customer. 
 
Suggest products and services to the customer.
Suggest products and services to every customer.
 
Offer additional add-ons.
Offer additional add-ons to every customer.
 
Deliver a great customer experience.
Deliver a great experience to every customer.
 
Makes sales.
Make sales to every customer.
 
Maximize your opportunities.
Maximize every customer opportunity.
 
So let me ask, are you maximizing every customer opportunity? 
 
If not, consider the impact doing so will have on your business if it becomes your number one priority.

An Impeccable Customer Experience

When my children were younger and were called to a meal or wanted to help in the kitchen my wife always asked them if their hands were impeccably clean.  She would explain why impeccably clean hands were needed.  She pointed out that you always want to eat with clean hands, and if you are going to be help in the kitchen you need clean hands to handle the food.

At first I wondered why she just didn't tell them to go wash their hands since she knew they hadn't, but I came to realize that she wasn't asking them to go through a motion, she was teaching them to maintain a standard.   Just as important, she wanted them to create a habit of washing their hands instead of having to be told.

Over time, the girls learned that impeccably clean meant never coming to the table or to expect to help in the kitchen without first washing their hands with soap and warm water. (Disclaimer: It doesn't always happen but for learning purpose let's pretend it does.  I digress.)

The point is that the girls learned why it's important to have clean hands and inherently understood the expected outcome.

Successful companies use this same approach to deliver a better customer experience than their competitors.   Employees who understand why an extraordinary and memorable customer experience is important to the company and their own success are more likely to deliver it than those who don't understand that concept.

Customer-centric companies also have a standard for the customer's experience.  Like my wife's expectation for children to sit down to dinner with impeccably clean hands, there is a stated desired outcome that all employees strive to deliver.  It's a key part of the company culture and is reinforced on a daily basis.

Of course everyone needs to be trained how to do their job, but when employees know the why and the expected outcome the how becomes much more important.

Take something as simple as a customer walking in the door.  Most retail employees have been taught to "greet" the customer within x amount of time but they don't understand why those first thirty to sixty seconds are so important in setting the tone of the customer's overall experience.  They also don't engage the customer in a meaningful way since they've never been taught how the customer should feel as a result of this initial engagement.  So they say things like, "How's it going?" but never stop to hear a reply because as far as they know their how is over and done.

Companies will always be more successful when the how is only taught after the why and the expected outcome.

So let me ask, metaphorically of course, does your staff have impeccably clean hands or do you have to tell them to go wash?  The difference is in the experience.

Assorted Retail Musings: Success, Time, and Credibility

I believe that we're always either moving towards or away from success.  There is no such thing as standing still in business or in our lives. The world around us, including our competition, is in constant change and flux, so to do nothing is to move backwards.

There are times where the forces around us are greater than before, and as a result we need to double and triple our efforts to keep driving towards success. If we're not pushing harder than the forces around us then we're moving away from success. The greatest danger is when we're not even aware of it.

Let me ask, are you moving towards or away from success?

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I often hear owners and managers say they don't have time to do something they know they should do.  I suggest that if they really wanted to do it, they would find the time. When we say we don't have time to do something we need to ask ourselves two questions:

1. Is it important that I do it or can someone else take care of it?

2. What do I need to stop doing so I can do this something else?

We all have things we like to do but sometimes those aren't the things we should be doing.  As owners and managers we need to be focused on high-impact, high-payoff activities and delegate the low-impact and low-payoff activities to members of the staff.

Let me ask, are you spending your time wisely?

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What's the fastest way to lose credibility with your customer? Believe it or not, it's speaking poorly of other companies and people.  Most customers are quite forgiving if you don't know something, but they don't like rude or unsportsmanlike behavior.

Here are five ways to lose credibility with your customers:

1. Speak poorly of your competitors.  I was visiting a retailer once and heard everyone on the staff constantly put down one of their competitors. When I brought it up to the owner she said that they were just passing along what their customers told them.  I reminded her that while that might be true, it sounded like sour grapes.  Now if someone asks about their competitors they just smile and say, "We're happy to say that our customers tell us how much more like they shopping here."

2. Speak poorly of a customer. While shopping recently I heard a store employee get off the phone and then go on and on to a colleague about the "stupid" customer.  As a customer, you can't help but wonder what they say about you after you leave the store. The only stupid person here is the employee who lost all credibility.

3. Speak poorly of another employee. This sometimes happens when a customer has a problem and one employee blames another for making a mistake. You'll hear things like, "He's new and doesn't really know much." While I'm sure the employee is saying that without malice, it doesn't sound good. Instead he might have said, "Since he was new I'm sure he was mistaken."

4. Speak poorly of a product in the store. I think this is a cardinal sin that unfortunately is committed more than we'd like to admit. Employees don't think about the message they're sending about their company when they make comments like, "You don't want to buy that" or "I refuse to sell that."  The customer is left to wonder why the company continues to sell the product if it's such a dog.

5. Speak poorly of a manufacturer or distributor you do business with. The customer can't help but wonder why you're carrying their products if they are as bad as the employee is making them out to be.

Remember the old adage, if you have nothing good to say then say nothing at all. Just as important, if you have something good to say then be sure and say it!

Are You Meeting YOUR Expectations?

We retailers spend a lot of time trying to figure out what makes our customers happy and how to keep them loyal to us. The answer isn't usually hard to find since it almost always lies within us. More often than not those of us in the industry have higher expectations of retailers than do most customers. Tell me you don't get really annoyed when a retailer does a poor job and that you don't get excited when a retailer exceeds your expectations.

To test this out I asked a retailer in my coaching and mentor program to write down three to five things she encounters as a shopper that make it more likely she will be a loyal customer.  She responded with these four:

1.  "I want to be acknowledged when I walk into a store.  Not pounced on but acknowledged. I might or might not want to be helped right away but if they're paying attention they should be able to tell."

2. "I know this sounds obvious but they got to have something I want to buy. There used to be this cute gift store in my town with really nice people working there but I never found a single thing I wanted to buy. I eventually quit going there."

3. "I want salespeople who really know their products. That's why I buy most of my clothes at a local store, not at department or chain stores. The women at that store always know exactly what will and won't work on me. So I guess that means they really have to know me as well as they know their products."

4. "I want to be appreciated.  This is a big one for me. I get so mad when stores act like they're doing me a favor taking my money."

Then I asked the big question.  How well do you and your staff meet these standards? Before she could answer I reminded her that there is a difference between hoping they do these things and knowing they do these things. "How would I know unless I'm at the store every minute of every day?" she asked.  My answer is that you know because making sure these actions are taken is ingrained in the organization and people do them without even thinking about it.

She thought about it and said, "I know we do the first one really well.  And I'm pretty sure we have the right products for our customers.  If we didn't our business wouldn't be growing every year. I also feel very confident that my people know their products inside and out.  I think we can do better at understanding our customer's needs but you and I are working on that."

Then the phone went quiet for a minute.  She continued, "I'm not sure we really show our customers how much we appreciate them. We tell people "thank you" when they buy something but I'm not sure we do much beyond that.  It's so important to me when I'm shopping but we're not doing it very well ourselves."

We talked a bit more and came up with several actions she can take. They include:

1. When thanking the customer the staff member will also tell the customer that they appreciate their business.

2. The owner and manger will each call a couple of customers a week to express their gratitude.

3. The staff will become more diligent about sending out thank-you cards.

So let me ask, how well are you and your store(s) executing what YOU expect as a customer? I would encourage you to go through the same exercise that we just did to learn of the opportunities that you might have to deliver an even more memorable and effective customer experience.

Michelli + Fleener = Shared Wisdom

Dr Joseph Michelli, bestselling author of The Starbucks Experience, recently posted a brief podcast on his site in which he talks about our own Doug Fleener's 50 Ways to Improve the Customer Experience. An insightful and outspoken proponent of the customer experience in his own right, Dr. Michelli offers some flattering words for Doug and Dynamic Experiences Group, and shares 12 of Doug's 50 tips with his listeners. It's definitely worth four minutes of your time.

Investing in Beyond Sorry

Last month I was in San Antonio to speak at the National Association of College Store's annual show. I was supposed to stay at a brand-new Hyatt hotel but due to construction delays it wasn't open yet.  I was moved to the Marriott hotel across the street and when I checked in I was given an envelope from the Hyatt.  In the envelope was a letter from the Hyatt general manager apologizing for any inconvenience - and a $100 American Express gift card. It was a wonderful gesture and a smart investment.

It's one thing to say you're sorry; it's another to ease the customer's inconvenience.

I sought out the Hyatt manager at the Convention Center and thanked him for Hyatt's generosity.  I have already told at least 10 people about this and with told thousands in my daily newsletter The Daily Retail Experience. And the next time I'm in San Antonio you can bet I'm staying at the Hyatt. Smart investment, that easing the inconvenience

Go beyond "sorry" and invest in easing your customer's inconvenience.  Remember, a customer is a terrible thing to waste!

How to Ruin Brand Loyalty

Recently, Doug and I had the opportunity to visit some stores throughout the area. Some were clients, some weren't. I was especially excited to visit one store in particular because I have been a loyal fan of their product and brand for many years, and had yet to visit their store.

Upon entering, I was struck by the awesome assortment of product, most at very reasonable prices relative to other brands in the industry. I felt like a kid in a candy store. My immediate thought upon entering was that if I had a larger house (and a more understanding wife) I could easily spend a few hundred dollars in the short time we would be there. I found things I didn't even know this company sold. I found great impulse items. I even found stuff I didn't know I wanted or needed until I saw it!

But what kept me from going on a crazy spending spree was the staff. The behaviors and attitudes of the three or four employees who stationed themselves behind the cash wrap completely turned me off. Here I was, picking up products, commenting on things, remarking on the great prices, and the staff remained completely aloof and uninterested in my desire to spend money. There was no attempt to build rapport, apart from a cursory and well-worn "How can we help you?" Instead they discussed lunch, talked among themselves, and sat on the back counter. If somebody were to erase the retail environment from around this group, it would be difficult to distinguish them from any other group of twenty-somethings hanging out at the mall, much less determine what brand they were representing. Remember, this was a manufacturer-owned and operated store. The employees work directly for the brand they're selling... or not selling, in this case. One would think that the talent on the sales floor would provide an experience that's representative of the quality and uniqueness of the brand's product. Instead of adding value and raising customers' perception of their product (and, not coincidentally, justifying the premium prices), the staff's lack of interest in their customers and product nearly ruined my appreciation and loyalty for their brand. Imagine what it would do for a customer who had yet to be enticed by the magic of these products.

Whether you're a manufacturer or retailer, brand loyalty is one of the most valuable assets you can build in your customers. The trust and advocacy that comes from a loyal customer is priceless. It's critical to empower employees with the skills and tools necessary to build brand loyalty in customers. Otherwise your brand simply becomes a name.

The Gifts That Keep On Giving... Back to You

The holiday season is fast approaching its inevitable conclusion for another year. Hopefully your sales have been better than last year and your staff has delivered exceptional experiences that will turn your customers into loyal advocates. And hopefully you've had the opportunity to complete your personal yuletide duties. In addition to meeting your responsibilities to your family and friends, you've hopefully remembered to include your peripheral business associates in your holiday cheer. Consider how many individuals impact and support your business without being your direct customer. Of course, you should already include your employees in your year-end thanks. How about the FedEx/UPS/DHL courier who picks-up/delivers to your site every day? The janitorial staff? The postal worker? The bank tellers? How about the staff of neighboring stores? The caffeine king or queen who provides you with your first jolt of bean juice in the morning? If you're on a first-name basis with any of these people, do yourself a favor and include them as recipients when it comes time to hand out small gifts or cards. Heck, even if you're not on a first-name basis (and goodness, you should be) these folks you interact with regularly can become great advocates for you and your business.

What's that you say? You're already paying some of these folks for the privilege of your business? Well, of course you are. But thanking somebody for helping you to run your business is different than paying an invoice. And we're talking a token gift here, not a college endowment. In fact, many companies forbid their employees from accepting gifts above a certain dollar value. A personal note of thanks, a $5 gift card to the coffee hut, or some tchotchke is sufficient.

When you remember those who helped you succeed throughout the year, they'll continue to do so throughout the new year and beyond.

Predictions for Retail in the New Year (Plus One)

The National Retail Federation's Stores.com website recently published a list of predictions for the upcoming year in retail. While there were no real surprises (consumers will continue to shop despite threats of recession, "green" practices will continue to pervade the way retailers appeal to customers, shopping excursions will become less of an event for more shoppers), there were a few interesting points of interest and one glaring omission.

First, the interesting bits. While social networking remains a dominant activity on computers, its infiltration into portable devices (cell phones, smartphones, media players) will drive a need for retailers to provide a more proactive approach to engaging customers. When a customer is able to get their questions answered by referencing a website or personal expert via their handheld device while they're standing in front of the product, retailers will need to be able to communicate a compelling reason to buy from them.

Another interesting, if not perplexing, conundrum facing retail in the next year is the growing rate of consumers' paradoxical desires. As Stores.com puts it:

You know this guy, right? Installed solar panels on the roof of his home; insists on cutting his grass with a push mower; recycles with vengeance. Yet, parked in his driveway is a Hummer. Having trouble putting the pieces together? That’s the challenge retailers and marketers face.

The real challenge will be to provide an experience on the retail floor that appeals to all sides of this consumer's psyche. Expect to see more and more customer segmentation and personality profiling studies over the next twelve to eighteen months.

Finally, it looks like one prediction was left off of the list. It speaks to a few different items on the list, but it deserves to stand out on its own because it's something retailers can have direct control over so that it doesn't adversely affect their business. We predict that over the next twelve months, customers will continue to grow increasingly intolerant of unengaging store personnel. As time and money start to reach parity in terms of value and scarcity, and more and more retail employees are brought on board with little-to-no customer engagement skills development, the result will be more consumers turning to the web or other avenues for their purchasing, eroding the loyalty that's so valuable to growing a business.

Well, just like Ebenezer Scrooge was able to prove the Ghost of Christmas Future wrong by changing his ways, retailers can thwart this course to destruction by investing the resources into making their sales talent engagement specialists. The retailers that succeed beyond the next year will be the ones that have customers singing the praises of their people.