Tuesday, April 20, 2010

The true differentiator

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You may be shopping for that sophisticated business suit for your first job or for an ethnic attire for a wedding reception. You land up in a mall hoping that you can choose from a wide variety of brands and stores to make your purchases at. You have beaten the traffic; cursed half a dozen jay-walkers and motorists and have finally pulled into the mall. You park your car and step into the atrium.…and Viola! The glitter and glamour; lights and music; shining floors and sparkling ceilings; those riotous colours from the show windows….and the excited shoppers have all transported you to another world. When you bring yourself back to reality and try to recollect why you are there; you seem to be more confused than you were before you entered the mall. You find yourself on the horns of a dilemma as to which store to patronise for your purchase? Trust me. It’s not your fault. Malls look alike from the inside; you find the same brands in this mall that you found in the previous mall that you visited. Only that, this mall has a BMW parked in the atrium while the previous mall had a Merc – the so called bumper prize! So much so that even the clowns out there to entertain shoppers are also from the same agency!

You went to the mall with a specific requirement – of buying a business suit for your first job and that is a ‘planned purchase’. Planned purchases are usually well thought of and well considered purchase decisions that we make to fulfil specific needs; and they are usually preceded by two layers of decision making. The first layer – what (product) to buy? Eg: a formal business suit and when to buy it? say, before that all important first day at work; where you want to make the best impression. The second layer of decision making however - what (brand) to buy? What store (to buy it from?) and how much to spend? - determine the ‘consideration set’ – a choice of stores that come to your mind unaided; that would fulfil your planned purchase. But, malls being what they are – one indistinguishable from the other; and stores inside of the malls; all looking increasingly similar, you tend to stray into any store that scream out their discounts the loudest.

If you are a retailer; every time a customer chooses to enter your competitor’s store, you are so much farther away from influencing his or her buying decision - even the vantage location (place) where you are located; seems to have little or no impact.

Is it true therefore, that the loudest and brightest advertisements or announcements of discounts always snatch away a customer? Are you, as a retailer completely at the mercy of what may attract (or rather distract) a potential customer from entering your store? Do you also have to spend on full-page colour advertisements or do up your store windows or erect discount posts outside your store to attract customers? Is it then, a battle of the advertising rupee - that takes away any edge you may be able to derive through your smart marketing plans (promotion).

We know it too well that – one retailer can outdo the other in the choice and assortment of merchandise offered (product) and the price at which it is being offered (price). With that, the four pins of McCarthy’s marketing mix lie knocked down on the slippery floors of retailing!

But, for retailers, a potential customer lost is a customer lost forever in these days of shifting loyalties. Therefore, is there something that we have missed here? How can you as a retailer ensure that a potential customer, safely and surely walks past all the tantalizing cacophony out there and step into your store to spend some of his money?

We agree that ‘Retail’ is all about ‘brands’ interacting with their ‘consumers’. And shoppers are people that have emotions and feelings; reacting differently to different stimuli. Their reactions can be made favourable or adverse – they choose to become ‘buyers’ or simply remain ‘shoppers’ depending on the influencers that interface with them during a shopping experience. In-store touch points have a significant influence on our shopping behaviours. While the product, price, lighting and ambience – inanimate as they are - play a limited role as passive influencers of purchase decisions; it is the human ingredient – as animate touch-points hold the highest potential to influence shopping behaviours and they can be ‘trained’ to ‘behave’ in a desired way to bring about favourable responses from customers. This makes our sales people the most pivotal of all interfaces between a ‘shopper’ and a ‘store’ – sales people play the role of true “catalysts” that convert ‘shoppers’ into ‘buyers’ while remaining unaffected themselves.

It is small wonder then that ‘planned purchases’ comprise only 30% of all purchases made. The remaining 70% are influenced on the shop-floor – a good part of them by sales people!

Getting salespeople to be better catalysts should be at the heart of any training program. Training retail salespeople is unlike how a tiger is trained in a circus - jumping through the loop at the lashing of a whip. It is more like Pavlov’s dog - who gets his feed to the accompaniment of a ringing bell – a conditioning that offers a reward for every effort.

Unlike the inanimate factors, ‘sales people’ can be ‘conditioned’. Much as ‘actors’ follow scripts while enacting their assigned roles; to the requirement of the ‘director’; so also sales associates can be trained to put up a ‘show’ every time a customer walks into your store. Having untrained sales people on the shop floor is like having all the characters on stage and having no script to follow! It is essential for retailers to first acknowledge the need to train – provide a screenplay and a script for their respective ‘retail shows’. And, find the right store manager to direct the play - who works with and through his sales team to bring about a cohesive and seamless performance to the liking of his customers, that results in a resounding applause (sales target). When this becomes a habit for a store team; the audiences (customers) will begin to ask for an encore each time (they will have compelling reasons to patronise your store again and again.)

It is for want of training that we see sloppy customer service around us. Retailers will do well to ensure that every training investment has these three right ingredients – 1) trainees with the right attitude to serve and the aptitude to learn (just as ‘casting’ is very important for a movie to get the right people to play the right characters). 2) A time-tested training curriculum that is both, enabling and empowering in its philosophy and approach (as critical as having a screenplay and a script) and 3) trainers who can empathize with the trainees and make the training impactful and enriching. (Just as makeup artists can make an actor look either like a prince or a pauper!)

In my next piece, I’ll write more on how to go about choosing the three ‘right’ ingredients.

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