customer-experience

The Human Touch

img_5934How important is face to face connection in the world of retail these days?  Based on recent sales floor experience, it’s clear that we are not yet ready for the Jetson life.  Below are the three most common reasons a customer crosses the threshold:

1. Return stations for online purchases. Customers don’t hesitate to order multiple sizes, and or multiple items to try on at home and return everything they decide against to a physical location. Their home is their private fitting room, and the local store is their reject rack. While there is some opportunity to flip this into a physical sale, it is typically a net negative sales transaction.  Do the store systems track the source of the returns?  If not, four wall performance is diminished by returns from another channel.

2.  Hungry for guidance.  Customers wander in looking slightly uncomfortable, standing in front of a merchandise presentation with a blank stare.  The relief they express when an informed and positive person gets them talking about why they have arrived, is palpable.  These interactions turn into a lot of fun.  Providing product knowledge and understanding the needs of a customer is key.   In these cases, price is not necessarily a primary decision driver.

3.  Specific hunt.  The shopper has an immediate need for an event or an emergency and don’t have time for a delivery.  Some shoppers are more than happy to make a less than perfect purchase because no one else in any other store had even approached them.

In the short time during which I have returned to the selling floor, the number of “thank you’s“ and “this was fun” heard from the customers in response to our shared experience has reinforced the prevailing discussion that the physical channel will continue to exist.  It’s up to each business to provide the experience worth visiting in every channel.  Happy, informed humans do help.

https://allpoetry.com/poem/8579885-The-Human-Touch-by-Spencer-Michael-Free

community

Are You a Good Witch or a Bad Witch?

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Glinda, the Good Witch, knew and cared about her followers. She spent time with them, listened to them and they loved her.

When was the last time you put yourself in the shoes of your customer’s experience?   With the reliance on data to tell us how well products and promotions are being accepted (or not) do we truly understand all of the stumbling blocks or successful conversion techniques behind a purchase?

With so much debate about the value of four wall vs online purchasing, I decided to spend some time in the nitty gritty world of the mall store to see for myself how much the purchasing experience had changed from the time I first began my merchandising journey.  Bottom line, not a whole lot.  These things are still of critical importance to a customer:

  1. A friendly, helpful greeting by an attentive (not hovering) and knowledgeable sales associate.   This includes checking in with them even after an “I’m browsing” response.
  2. “Knowledgeable” includes familiarity with the product assortment, sizing, promotional activity in store and online and store set up, as well as quality vs. competition.
  3. A neat, well merchandised selling floor, including markdown merchandise.
  4. Consistent refreshing of the merchandise focus to keep the customer entertained and engaged with new products in the front of the store and windows.  As we all know, this is invaluable marketing real estate.
  5. A sense of community interacting with the customer and a thank you with a ” It was fun working with you, we’re looking forward to seeing you next time” message as they leave.

The other key component in a winning store experience was and continues to be a selling staff who is committed, well informed and is supported and empowered by the entire organization.  These people work very hard juggling multiple priorities which are also physically demanding and at times unpredictable.  Two of the leading frustrations which impact an associate’s interaction with customers are:

  1. Conflicting prices and promotions online vs. in store.  Many four wall customers follow online assortments and promotions very carefully challenging the sales staff on pricing over which they have no control.  A policy giving the stores the ability to price match on the spot would solve this.  Better yet, synergized promotions for a seamless omnichannel experience.
  2. Systems which apply in store online returns against store sales goals.  While there is often an opportunity to exchange online product for additional product in the physical store, many customers order a range of sizes to find the best fit and then return the other sizes for credit, reducing the overall metrics for the day including for which stores against which stores are bonused and reviewed.  This also skews the amount of business attributed to the online channel in relation to the four wall.  Doubt many store customers are returning their four wall purchases to the online channel.  (This is not a new challenge.  Mail order/catalog has long done the same thing.  With the sophistication of systems these days, though, it should be recognized and addressed.)

Ask yourself.

Do you choose to be a Good Witch:  https://youtu.be/TP_wx0qrKu0

Or a Bad Witch:  https://youtu.be/Leb83bRkXDg

To be successful, our customer needs to know where to find her ruby slippers.  From us, of course.

data

Lies, Damn Lies and Analytics

Easy to get caged in your analytical playpen when you don’t know the why behind the data.  Learn to ask the tough questions.

The beauty of a dashboard is that access to statistics and results can be immediate.  With the press of a button, google analytics provides a host of information on a websites performance. The daily sales dashboard from the data warehouse has some good stats. The unfortunate result of that is proclamations of success or failure at any given point without comprehension of the why, can drive action which does real damage to an assortment, a marketing campaign, revenue drivers, purchase projections.  You name it.

The downfall of a dashboard is that many observing it don’t understand the why behind the current results.

  • The average order value to our customer is continuing to increase annually.  We’re doing such a good job providing them with the goods and services they demand.  What do you mean the customer base is decreasing?  We need more customers!  Let’s grab them from our competition.
  • Traffic to the website is spiking.  We’re brilliant!  Oh.  What do you mean that 500,000 catalogs landed in mailboxes this week?  That’s print.  Print is dead.  It’s all about our website.  Look at that increase in conversions!  Look at the average order value!
  • Look at the revenue we’re driving with that discount coupon!  We’re up 30% in revenue!  We need to keep up price promotions on the entire site!  Our customer base is eating this up!  What do you mean we’ve lost 600bps in margin?  We’ll make it up in margin dollars!  Why are we out of our bestselling products?
  •  Revenue in category A increased from 10% of the total to 20% of the total for a 100% increase in sales. Genius!   Really?  Give me the $.  Sales and margin.  If total revenue increased from $100,000 to $105,000, then category A increased from $10,000 to $21,000 which is 110% increase in sales in the category, driving an overall 5% increase in revenue.  Unfortunately, category B and C, which have higher margins than category A dropped in penetration due to downtrending product, or delivery issues, or price increases due to tariff changes, etc.  So overall gross margin came in at $32,000 vs. $38,000 LY, leaving less to cover overhead.  Where do we cut?

Basic arithmetic and an good understanding of the foundations of a business are all you need to dissect a dashboard.  How many times do you hear the why questions being asked?  Sure, traffic and page view increases to a site make everyone feel good.  More feet through the door are exciting.  But if they don’t funnel through with increases in conversions and order values, the story can be misleading and may not end well.  Give me facts tied to actual products and categories any time.  The right mix combined with more customers will have happy ending.

 

marketing, merchandising

Blurred Lines

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Photo by Phil Kallahar on Pexels.com

Marketing or merchandising?  Who gets to choose the focus? This tension has existed for as long as I can remember.  Marketers are the story tellers, determining and inspiring the targeted audience to make the purchase. Merchants comb the market place on a constant quest for the “right stuff” and always take into account the why and the who behind the choices. If you don’t know why you’re offering a product, you should not be acquiring it. Sometimes that stuff is exclusively developed with product managers and/or manufacturers to drive demand.  In others, the merchandise is inspired by instinct based on glimpses of trends from all types of media. Or simply part of someone’s product line. (My kids thought people read magazines by ripping the pages after experiencing my habits.) Product assortments are based on logic and magic…interpretations of what is on the horizon, has been successful in other forms, or is total shot in the dark based on gut and analysis.

If merchants don’t know why they are purchasing/developing product, don’t have a clear vision of the price and profit guidelines and have no vision of product positioning, they aren’t doing their job.  Same goes with marketers. If they aren’t asking the why behind the what in order to tell their story, they are not contributing to business growth in a collaborative partnership. It’s a team effort.  Both talents are necessary to grow a profitable customer base.  Embrace the blurring and create something great!

Now that you have an earworm, here’s some relief: http://bit.ly/2oQpiDO

 

conversion, demand, marketing, merchandising, story telling

Creating Demand

Bicycles

As an economics major, the very first lessons involve supply and demand.  When demand increases, supply should rise to meet the demand without flooding the market with excess.  If that happens, the product becomes ordinary and the price lever is utilized in an effort to reduce the supply before demand evaporates altogether.

Designers begin demand creation by developing inspiring products, often working with merchandising and marketing teams for input.  Flattering silhouettes.  Appealing colors.  Uniquely useful items.  Faster, smarter, better.  Items that make a statement about the person consuming them.  Without exposing those things to an audience, the creation has no purpose.  Merchants are constantly searching for the fresh, new “stuff” with a target audience, price tolerance, profit margin and end use in mind, often guided by details in financial plans and working with merchandise planning teams.  Marketers are critical in getting the story of those products in front of the key audiences using both visual and analytical components for the best ROI.  All together, they create demand while walking the razor’s edge of the right amount of supply as well as product expansion opportunities.  When the demand for the supply has begun to downtrend, price reduction can be used responsibly to liquidate the excess quantities.

This all leads to the right product, at the right price, in the right quantities at the right time.  The ultimate endgame for creating demand and maximizing profit.  Otherwise, why bother.  Driving demand with the hi/lo pricing game may drive short term results, but will ultimately reduce profitability and shorten the life of a product prematurely.

demand, merchandising

Content + Commerce

In a prior life, my role was to guide the selection and presentation of very specific product to a passionate enthusiast base.  Their positive response would drive profit and revenue to the business. Content was aspirational photography and detailed instructions and supplies in the same category of product but vastly varied aesthetics, size and difficulty levels. The challenge was telling a compelling story to entice and convince the viewer that they needed multiple versions of the product category because they would be missing out on something great if they didn’t pounce on it. Whether the offerings be colorways, patterns, specific prints, techniques, or an exclusive deep black fabric, they needed to light a creative fire.

Another adventure was in the world of childbirth and early childhood education, combining that with the best “stuff” in the business.  Working with IBCLCs, nurse midwives, early childhood education experts, child safety experts, and many others, we not only conducted classes online and in our center communities, but we culled through all of the unnecessary and unsafe product offered in a vacuum to uninformed parents and their friends and families.  Content was king, but commerce sealed the deal.  You could see the shoulders relax in a father who had been sent on an emergency errand to pick up a breast pump part when he walked into one of our locations.  Or the groups of brand new mothers heading out of a classroom with their babies and new friends in the exact same boat.

What is your content for your commerce?  Do your merchants, marketers and planners know how to set that stage for the theater that is retail?  Think about your business and ask yourself where that happens.  How does each channel function?  Do the product pages on your site provide inspiration, as well as all of the details that a customer needs to pull the trigger?  Do your emails or direct mailings drive traffic to all of your channels?  How are they richer in content than your competition?  Is there a sense of urgency created ?  Limited quantities, unique product properties?  Something beyond price?  I hope so.  Without the perceived value of information and inspiration, who cares.