Jun 18, 2014 | Collaboration, Customers, retail, Small business
Strategyaudit.com.au
Chain stores dominate our grocery shopping environment, they have developed all the advantages of scale, and use them to the advantage of their shareholders, by delivering returns, and to customers by delivering low prices.
The model works, in Australia 75% of the grocery shopping dollar goes to one of two retailers, and small retailers have been decimated.
However, small retailers are making a comeback, the ones left are good, good enough to deliver value to their customers in different ways to the chains, and they are making a good bob.
They compete with a variety of strategies, all of which have elements of the following 10 rules.
- Make the store look warm, friendly, inviting, and, importantly, current. The last Valentines day, a client put in huge volumes of roses on which he put some very cheap prices compared to the highway robbery employed elsewhere, but he also had a promotion of Chocolates and a voucher for collaborative promotion with the grog shop two doors down, on sale. He did sell a lot of roses, a pile of chocolate, and got a slice from the bubbles the grog shop sold.
- Collaborative retailing is a really effective way of building sales and relationship s with customers. The example above worked really well, as have others that group retailers of differing women’s apparel, dresses, shoes, hairdressing services, et al together.
- Experiment, with everything under your control. Store layout, range, price, stock weight and position, proximity of complementary products, promotional activity, it is a long list limited only by imagination and energy. However, experimenting is not the only game, you need to track results, now easy via the electronic tills, and if nothing else, Excel pivot tables. Understand what works, and improve it for next time, eliminating the things that prove not to work. It is a simple formula, challenging to implement consistently, but in principal, simple. Learn as you go, and as the you experiment more, you will also find your depth of tacit knowledge also increases. A small business can put in place an experiment, have the outcomes and a resulting tactical outlook while their bigger competitors are still trying to get a meeting together to decide if it may be a good idea.
- Use technology widely, not just in the tracking of sales, but in the management of your operations, and most importantly, the engagement of your consumers. Make your website the co-ordination centre of your marketing efforts. Mobile, email, social media platforms, blog posts, all potentially have a place, but mostly you cannot do them all, so make informed choices. However, you need to recognise that digital is not free, there are both operating and opportunity costs attached, and for most SME’s, a capability gap. Outsource all you can, which is getting easier by the day, and importantly, track the results of everything you are doing on line
- Make sure you have a website that does you justice. A mate sent this to me this link to Victor Churchill, a butcher in Sydney’s eastern suburbs, and now I just want to go there.
- Personalise, personalise, personalise. The chain retailers have “mass market” business model, they cannot easily personalise their offer to the customer base. They may have a technology edge because they have the resources, but how often does the casual filling the shelves greet a customer by name? Enquire after their kids, and ask how the fruit basket you supplied last week for the centre-piece of your dinner party work out?.
- Specialise in what you do best, deliver “depth” to consumers where the mass retailers can only deliver “breadth” to a mass market.
- Be the expert in your category. If you are a produce retailer, know where the best strawberries come from, and when they will be available , similarly, a fashion retailer needs to be current with the trendsetters, to know what is coming, what will accessorise easily, and how the fashion can be tailored to the market they are serving. Most people want to deal with, and seek the affirmation of experts, be the expert, and they will keep on coming back.
- Apply the disciplines of Category Management to your inventory and space management. In its simplest form, Category Management is a mindset that seeks to allocate finite and valuable shelf space on the basis of maximising the customer experience, while delivering optimised profitability and long term commercial sustainability. This can get as complicated as you like, but for an SME, building an excel database leveraging the capability of pivot tables, tools virtually every business has sitting on their PC already, is sufficient to get started.
- Watch the cash. This one always gets a run. Retailers greatest cost, and biggest risk is usually inventory, and inventory is a raging consumer of cash. On the other hand, the oldest adage in retailing is “stock sells stock”, so there is a tightrope to be walked. Perhaps the most valuable, and in SME’s underused, performance measure in retailing is stock turn. Use it aggressively to fine tune your range, and inventory.
None of these “rules” are of great value separately, but together, they offer a potent competitive tool set for small retailers.
Jun 11, 2014 | Collaboration, Customers, Social Media
There are many contenders for the most effective social media too around, and just as many promoters.
“Email marketing” and “Content marketing” usually occupy the first and second places, but to my mind are one and the same. Email does not work without content, and vice versa.
Further down the list you get bombarded with the names of platforms, facebook, Linkedin, Pinterest, et al, then tools and services like SEO, landing page optimisation, affiliate selling, yada, yada, yada.
The one tool we know for sure that maximises the chances of success is a real conversation.
Remember them?
Two people sit down, exchange views and ideas, interact as humans have throughout our history, and determine if there is mutual value in doing business.
Personal communication can be confronting, is extremely resource hungry, hard to schedule, and is still a punt, but perhaps those real hurdles are why it still works best.
The management challenge is to deploy the limited and expensive resources for a return from this most effective of social media investments, your obvious commitment to the other person.
May 29, 2014 | Branding, Communication, Customers, Marketing, Social Media
http://tomfishburne.com/?s=word+of+mouth&x=0&y=0
This morning a friend was telling me about a product he had used recently, and how it changed his life. Well, made a small piece of it better at least.
Next time I am looking for a product in that category, I will try it. Very little to lose even if I do not share the enthusiasm, and I value my friends opinion.
Word of mouth marketing.
Free marketing for the product supplier, right?
Consider how much effort went into making the product right, managing and optimising the value chain, in creating the programs that engaged and made an advocate of my friend, and gave him the stories to pass on to me.
Word of mouth is very effective, the most effective form of marketing we humans have ever seen, and on the surface it is free, but beneath the surface, there is frantic paddling going on.
Word of mouth marketing works but is not free, it is earned.
Apr 29, 2014 | Communication, Customers, Sales, Small business
Successful selling
Regularly I find myself on the receiving end of a pitch of some sort, as do all in business. We all buy and sell on a daily basis, and whilst there are easily recognisable and specialised functions that buy and sell on behalf of our organisations, we nevertheless are “pitchers”, and “pitchees” every day.
It seems that one of the impacts of digital communication has been to help us forget, or perhaps brush over some of the foundation sales skills honed over the millennia of human activity, so here they are again:
- Listen rather than speak. Asking questions, listening to the responses, and then asking the follow up questions has always been, and will always be the best sales strategy.
- Benefits not features. When you are speaking, talk about the benefits of your offering to the “pitchee” rather than reciting the features. Customers are really only interested in what value a product is to them, not what the range of features may be, so focus on value to them by demonstrating how your product makes their life easier, more efficient, and more productive.
- Deliver useful insights, knowledge, and intelligence. Being of value to a customer is more than just flogging product, it is also about articulating the context in which the product will be used to add value. Clearly however, there is a line here with confidentiality, any potential customer who hears what their competitors may be doing from you will never trust you again to keep their confidence, but the best sales people are always able to deliver solutions to problems they have collaborated to articulate.
Easy to say, often hard to do.
Apr 24, 2014 | Branding, Category, Customers, Marketing, retail
Businesses spend many millions trying to understand the way consumers consider the choices confronting them in a supermarket. With up to 30,000 items on shelf, and some categories having hundreds of choices, it is a key consideration.
A mix of psychology, data science, habitual behaviour, discretionary spending dollars available, and individual preferences all play a role.
A complicated mix.
However, there is a way to at least clarify part of the mix.
Consumers use decision trees, usually without thinking about them when they are in a supermarket making their purchases.
Some purchases are automatic, a habitual choice, others are made after a considered set of choices on a range of factors important to the individual are made, and there are, obviously, many shades of this continuum that apply to a highly personal process.
Imagine a consumer approaching the dairy case looking for fruited yoghurt. Some may just buy their usual brand, flavour and size irrespective of everything else. Others will make a series of choices that will vary for every person, and may look something like the decision tree below.
It will differ for each individual, some will choose the brand first, others the flavour, or the size and price, and a whole range of variations on these factors, but based on the total sales, supermarkets will range products, and give them shelf positions and space based on sales, gross margins, delivered margins, and various promotional strategies. They also use a decision tree.
Retailers and suppliers spend huge amounts of effort, and resources. on this category management exercise, trying to read the consumers mind, and anticipate their reactions to various combinations that are available to them.
It is a data intensive exercise, well suited to the “big data” techniques that are evolving around us. Combining checkout data with store loyalty cards is now becoming commonplace, what is emerging currently is the integration of mobile and social media data into the mix.
As you walk into the store to buy something, there has already been lots of effort gone into reading your mind, and there will be lots of effort and money expended in store in an effort to manage your purchase decisions.
Apr 22, 2014 | Communication, Customers, Marketing, Sales, Small business, Social Media
These days with the ubiquity of mobile and social, almost everyone is a media channel.
Recognising this simple fact changes the formula for media success. In the old days, the formula used so successfully by mass marketers was:
Money X mass media = Sales.
This used to work, no longer, now that media has fragmented into thousands of pieces, and individuals have a personal menu of media consumption based on their interests, time, and competing priorities in their lives. The formula marketers now have to use is something like:
Time X tailored and personalised media = a chance for a sale.
Much more uncertain.
In this context, spending some time considering the productivity of the investment being made in social media, and you are making them, even if it is just the employee who spends some of your time checking their facebook timeline, would be useful.
Following is a framework you might like to think about. The reality is that it is little different from a normal Marketing Audit, is it just that we are focussing on social and the content that fuels engagement.
Social media competitive analysis.
- What are we doing?
- What are direct competitors doing?
- What are the successful Social media attention grabbers doing?
- What kind of content are our competitors producing and distributing?
- How, where and when are they distributing?
- How are competitive strategies performing? A. In keeping their customers engaged, and, B. In attracting other customers, including ours
- Where do we have opportunities?
- Where are we under-performing?
- What can we do to restructure our activities within existing capabilities?
- What capabilities do we need/should be developed?
Content plan
- Determine the behavioural and “tone” of the intended audience
- Indentify what type of content should be developed
- Source and develop the content
- Create a content calendar
- Develop a set of performance metrics
- Build in the expectation of continuous A/B testing, tweaking testing, tweaking….
- Build a list of users, and track their use of and engagement with your content, being prepared to personalise
- Leverage the list, but ensure that the communication is always personal, and appropriate to the current situation of the prospect.
Repeat all above, again.
Content marketing has become all the rage, there are so called gurus out there selling new brands of snake-oil, and many are extraordinarily good at parting you with your money. However, the simple and fundamental truth of marketing remains: you must add value to your customers lives. Failure to do that results in just having a big bag of fancy hot air, not much use to anyone, no matter how fancy the plan.
Oh, and one last thing about plans that I bang on relentlessly to my clients: You get only 1 point out of 10 for the plan, the other 9 are reserved for implementation.
For a “How to” of an audit of the technical detail on your site, this post of Neil Patels is a terrific start.
I would value your feedback on how you undertake a content audit, so let me know.
