The New Technique To Boost Your SalesPosted 15 Jul 2018 Trevor Johnson examines the technique that could significantly boost your sales
It’s a grim fact of business life that in the current financial climate 25 per cent of retail start-ups will fail in their first year and 36 per cent in their second. But does it have to be that way?
Not according to an increasing number of business analysts, who believe that a strategy developed in America a decade ago and now spreading into the UK and Europe can not only be the key to financial survival, but can dramatically increase sales, in some cases by as much as 20 per cent.
Until recently, what is known as power selling was only used by retail giants. But now it has been proved that the principles can apply to almost any sales business, however small, which is anxious to attract new customers and - even more important - retain existing ones.
So just what is power retailing and could it help you? According to Professor Barry Berman of Hofstra University school of business, it’s a strategy that:
- Identifies customer needs.
- Pays constant attention to the marketplace.
- Orders goods early and in quantity.
- Plans ahead to dominate competitors.
“Customers’ expectations are constantly rising,” says a spokesman for the Grass Roots Group, which gives advice on customer service. “Nowadays the customer is very much in the driving seat. The power of consumers has never been so great because they have so much choice.”
It seems that the days when companies could simply make a product, advertise it and sell it are long gone. Now, according to power retailing gurus, a successful business, regardless of size, must:
- Devise a game plan.
- Focus on consumers and how best to satisfy them.
- Be dominant in at least one aspect of its strategy.
Professor Berman says that before embarking on a power retailing policy it’s important to recognise that you may have to make changes in the way you do business.
“Seek advice from your trade association or consider hiring an industry consultant to conduct a study on what customers like and dislike about what you do,” he says.
“Remember that a completely price oriented strategy may be the easiest for competitors to duplicate and that price sensitive customers often have little retail loyalty.”
Six key aspects
Professor Berman pinpoints six key aspects of power retailing and stresses that a business needs to do “a superior job” in at least one of these. Mid level or less in all six apparently means you could have serious problems in the not too distant future:
- Be price oriented and cost efficient to appeal to price sensitive customers.
- Be upscale to appeal to status conscious consumers.
- Be convenience oriented to appeal to consumers interested in easy shopping, nearby locations and long store hours.
- Be able to offer lines that will appeal to customers interested in variety and shopping comparisons.
- Be strong on customer service to appeal to people who say they’re frustrated by what they see as a general decline in retail services.
- Be innovative and exclusive and carry products not stocked by rivals that will appeal to customers bored with seeing samey displays in other shops and businesses.
Look the part
Consultants stress that an important ingredient of successful power retailing is giving the right impression. Over 75 per cent of potential retail customers questioned in a recent CBI survey admitted that first appearances would probably dictate whether or not they did business.
So make sure you and your staff look the part. Remember, a customer’s first impression will be only seven per cent based on what you say, compared to 37 per cent how you say it and 55 per cent how you look.
Motivational psychologist Catherine Parks believes a major ingredient of power retailing is making the customer feel special.
She says: “A London School of Economics study showed that 75 per cent of customers who go elsewhere do so because they feel the company they are dealing with ‘isn’t bothered whether they have my business or not’.”
Catherine stresses that however effective the power retailing build up, ultimate success still crucially depends on point on sale technique.
“Don’t rush things,” she advises. “Make the customer feel that selling him or her the right product is all that matters to you, however long it takes. Keep the decision process simple and don’t provide too many details at an early stage. Divide the selling process into a series of small painless decisions and move from one to another.
“Encourage responsible impulse buying as part of a power retailing strategy. Studies show that up to 35 per cent of customers will probably buy more than they originally intended if conditions are right.
“Emphasise value and minimise cost. Show customers what your product can do. Then start with the lowest price and move upwards. Don’t exert pressure to close the sale.
“After a successful conclusion, thank the buyer. That’s so rare nowadays, it’s likely to make a lasting impression.”
Marketing consultant Alan Oaksey, a leading advocate of power retailing, says a key to the strategy is building customer confidence: “Get them involved in the buying process. Make them feel comfortable and encourage them to ask questions and give their views. “Today, successful power retailing is all about understanding what motivates your clients.
“Without knowing that, a sales campaign, no matter how much money you throw at it, just hasn’t got a hope.”
Here’s what power retailing can do
- Creates confidence by letting customers get hands on and test products before they buy.
- Eliminates obstacles - streamlining the path to purchase by using technology to let customers find and buy products anywhere, either in-store or online.
- Makes things personal by using customer relationship management systems, loyalty programmes and similar tech tools to deliver personalised service based on customers’ past experiences.
- Promotes transparency by giving customers a behind the scenes look at where products originate, who makes them and their environmental footprints
- Cultivates a community feeling by providing opportunities for customers to get together around your brand and value your products. Think about how Apple offer classes within its stores.
- Improves feedback by tapping into customer knowledge on your products and creating opportunities for them to become brand advocates. Use social media and other online communities to get that valuable feedback.