Showrooming and the sales prevention department

Last time, we discussed the often forgotten reason for showrooming that happens after price shopping: convenience and time/fuel savings.

Remember Kübler-Ross’ five stages of grief? If you’ve forgotten, they are denial, anger, bargaining, depression and acceptance.

When applied to showrooming, it isn’t much different. Acceptance and the clarity that accompanies it are where the sales live. Even big retail is figuring it out.

Big retail embraces showrooming

Big retailers are starting to embrace showrooming because they’ve realized that reacting to and/or punishing it has proven ineffective. Learn from their mistakes, research and investments. Customers who showroom are likely to be better informed shoppers that you don’t want to lose. Their phone might help them decide that your store is the right place to buy.

Retailers that welcome the smartphone shopper in their stores with mobile applications and wi-fi access — rather than fearing showrooming — can be better positioned to accelerate their in-store sales – particularly with the holiday shopping season approaching.

Shoppers armed with smartphones are 14 percent more likely to make a purchase in the store than those who do not use a smartphone as part of their in-store journey. – Deloitte study for Saks Fifth Avenue

Most small businesses don’t have the resources to embrace showrooming with a smartphone app, or don’t think they do. If that’s the case, what do you do?

The simplest answer is to side with the customer. Do this by making the in-store experience so much better than anything anyone can provide online. That’s where it pays to visit an Apple store – where nothing is like retail as you typically see it.

The last Apple store I visited was in Portland. In an average-sized mall store, there were 28 employees on the sales floor – and all of them were with customers. I thought this was odd, so I tried another Apple store.

Same thing.  There were over 100 shoppers in the store. Almost all of them were in groups engaged in a conversation while they used an Apple device. Many of those conversations included an Apple staffer.

The sales prevention department

Compare that to the shopping experience in a typical consumer electronics store.

Try to test drive a Kindle. It’s locked in demo mode. You can’t pick it up and hold it because of the security device and short “don’t steal me” cable attached to it.

The display of the device is focused on theft prevention. Why is this a bad thing? Because theft prevention becomes sales prevention.

In an Apple store, nothing’s locked down. Sure, there are lots of people around to make sure you don’t walk out the door with that fancy MacBook – but the products are presented in a way that is clearly designed to encourage you to pick them up and try them out.

Unlike most stores that sell laptops and tablets, the devices aren’t cabled down, nor is there a password protected screensaver that prevents you from doing any real examination of the machine.

They make this happen because no matter what you do to the device, at the end of the day, they have systems in place to “wipe” them and reset them to out-of-the-box new condition, software-wise. This assures that the next day’s sales aren’t impacted by what someone might have done to a device. They can also reset them during the day if someone went really crazy.

It’s almost unfair to sell against a setup like that. Perhaps that’s why Apple’s retail sales per square foot are higher than anyone else’s – over $6000 per foot.

What’s different?

If you’ve ever visited an Apple store, you’ve never seen a dead machine, much less one with a message that tells you it needs attention from a technical person. You won’t see a locked screensaver.

Now think about other electronics retailers. Their sales floor machines are locked down that you can’t do anything and there’s almost always one that’s off in never-never land, waiting for some tech help.

Step back a few paces. This isn’t just about Apple, laptops or tablets. It’s about encouraging someone to engage with your product, thus *enabling* a purchase.

No matter what you sell, ask yourself these two questions:

  • Are your displays focused making it easy to fall in love with a product and buy it?
    OR
  • Are your displays focused on controlling the sales process and preventing theft?

Making it easier to buy is something every one of us can do. It’s price-based showrooming’s Kryptonite.

Jobs – A personal loss

As I sit here and absorb the passing of Steve Jobs, a few things strike me.

Many are aware that he co-founded, left, and then returned to lead Apple’s turnaround – transforming it into one of the most valuable businesses in the U.S.

Many are aware of his attention to detail and quality.

For example, Robert Scoble a few weeks ago wrote about Jobs’ attention to things that seemingly didn’t matter, noting that Jobs showed off the metal on the back of iPad2 during the keynote, remarking that “other CEOs didnâ??t care about the back of their products. They cared, instead, about shaving cost from them instead.”

Many are aware that his and Apple’s focus on end to end design as a strategic edge that still escapes many products. Meanwhile others fail to bridge the distance from brochure to website to business card.

Many are aware of his and Apple’s rare ability (particularly for a tech company) to get marketing *so well*, so much so that you know it was discussed during product design.

But that isn’t what caught my attention.

Business is Personal

[blackbirdpie url=”http://twitter.com/HildyGottlieb/statuses/121778100643172352″]

What struck me early on was that his passing touched so many on a personal level, myself included.

Yes, I know a lot of folks in the tech community but none of them knew Steve personally. Still, I feel compelled to call him ‘Steve’ even though we never met.

Many of the folks that I talked with in the first couple of hours were not in the tech industry. Yet they too were touched. Some were surprised at how much his death affected them. Hildy’s comment (above) was but one of many examples.

Remember for a moment that we’re not talking about a guy who came over to help these people move into a new apartment, but the just-barely-former Fortune 50 CEO of a company whose market cap is the size of Exxon/Mobil’s.

Think about it: If the CEO of another Fortune 50 company passed on, would Facebook, Twitter and blogs be flooded with personal tributes? Would “average Joe” be able to reel off that CEO’s three most successful products?

Unlikely.

That’s not a slam at them. It’s simply an illustration of one more thing that Steve did so well.

A Final Note

The 24 hours following Apple’s Tuesday keynote turned into “Bag on (Apple CEO) Tim Cook” day.

Despite announcing a phone that’s twice as fast as the previous model, a new voice command system and a new operating system, pundits all over the net were talking about how Cook’s first Apple keynote was such a disappointing performance and how he “just wasn’t Steve”.

None of them could have known that Cook and his VPs took the stage to launch iOS5 and iPhone 4S despite knowing Jobs’ condition.

I can’t imagine how that could have felt, much less how it feels now.

RIP, Steve. You showed us how personal business should be.

What’s your plywood?

“When youâ??re a carpenter making a beautiful chest of drawers, youâ??re not going to use a piece of plywood on the back, even though it faces the wall and nobody will ever see it. Youâ??ll know itâ??s there, so youâ??re going to use a beautiful piece of wood on the back. For you to sleep well at night, the aesthetic, the quality, has to be carried all the way through.” – Steve Jobs

What’s your plywood?

PS: Thanks for raising the bar, Steve. Be well.

 

It Starts With Trust

Earning, retaining and regaining the trust of your customers has been central to this blog from the beginning.

We talk about a lot of different things that all come down to creating an atmosphere of trust with your clientele. That trust will build a relationship and that relationship, even if impersonal, is what makes business personal to your customers.

A few questions came out of recent conversations on these topics and the best ones were these:

  • How can an impersonal business relationship truly be personal?
  • How does a vendor recover from a massive loss of trust?

Come on, Steeeeve

How can an impersonal business relationship truly be personal?

Easy…it starts with trust.

For example, I have a relationship with Apple CEO Steve Jobs. Do we know each other personally, like I do some of my readers? No.

Despite that, I know enough about him from his behavior and the behavior of his company to trust him – at least enough to invest in his company’s products and recommend them to others who trust me.

His behavior and the behavior of his company over time tell me a few things:

I trust that when he walks on stage to speak about new products:

  • He is going to announce things will often seem as if they were designed specifically for my use. Not because he has me on speed dial, but because his company has habitually built products which do just that.
  • He is going to announce products that will be publicly available today or very soon.

 

How is that different from others?

Some companies build something not to fill a need their customers have expressed,  or a need that they’ve discovered through vision and research, but because (for example) they compete with Apple in some other way and perhaps feel obligated to compete there too.

Those conversations seem to start with “Wouldn’t it be cool if…” or “Well, if so-and-so did it, so can we…”

When you come to market with a product with that much R&D behind it and no one blinks… somewhere, somehow, your company simply isn’t listening well.

Example, HP just cancelled WebOS and their TouchPad tablet one day after Best Buy publicly complained they’d only managed to sell 25,000 of the 270,000 devices they ordered. While it seems to me that this is a strategic buying error on Best Buy’s part, it isn’t as if HP can’t be held accountable for making a product that can’t compete in the marketplace. No question that the iPad and other devices hurt them badly, but they’ve known about the iPad since at least January 2010.

Again…listen well.

Some vendors announce new products years before they plan to ship – and in some cases they never deliver them. In the most extreme cases, they pre-sell them and then fail to deliver. Some repeatedly toss out anticipated release dates and never meet any of them. Try recovering from a misstep like that, even if it wasn’t intentional.

Trust starts in the mirror

How does a vendor recover from a massive loss of trust?

At the risk of being Mr. Obvious, you start recovering by earning back the trust you lost (or earning what you never had).

Start with this: Say what you’ll do, then do what you said. If you stumble, own up to it. Seem too simple? Laugh it off if you like, but as Tom Peters says “There’s not much traffic on the extra mile.”

Some of you will point to Jerry over there and you’ll say “He’ll never come back no matter what we do.”

You might be right, but more Jerrys will leave if you keep acting the way you do now. If you don’t change, how can you expect them to? Even if you don’t get Jerry back, there are others who will recognize your efforts with each bit of trust you earn.

Each customer you lose because of something you did to lose the trust of that customer. You delivered late. You didn’t deliver at all. Your quality was poor. You treated them poorly.

These problems can be repaired. Just like trust.

 

Borders and homemade apple pie

Recently, Borders book stores reported that they were closing their remaining 399 stores, including our local store here in Kalispell, Montana.

The store has about three months, enough time to liquidate their existing stock.

Survival of the fittest demands that some prosper, some get by and some die. Borders was not one of the fittest booksellers around, and few businesses have a chance of getting up after taking a one-two punch from Amazon and Apple.

Still, there are takeaways for the rest of us.

Homemade Apple Pie?

When you go to an online store, you KNOW when they’ve just tossed up a store so they can say they have one, kind of like how your mom knows when a local restaurant makes their own apple pie or serves a food service vendor pie.

In one case, it’s a labor of love. In the other, it seems like it’s just there because it has to be.

It’s not unlike Borders’ technology, eCommerce and eBook efforts. Once they got around to it, they served food service pie.

Who to blame?

They can’t blame Napster and peer-to-peer sharing. The music business can try, but you don’t see music acts starving. The same can’t be said for their the stuck-in-the-50-60-70s music management houses. Ask a Canadian or European about online music listening from US-based services. You won’t hear many kind words. Inertia and lack of vision killed many of them and took the local music store down with them. Napster was simply the messenger and peer-to-peer the medium. There’s no equivalent in the book business.

They can’t blame their store staff. In the Borders stores I’ve visited, the staff is well-trained and eager to help. Maybe reading fans self-select as Borders job applicants. Regardless of how their stores found their front-line employees, I can’t think of one who wasn’t helpful, knowledgeable etc. I can’t ever remember being tempted to write about them due to bizarre or off-kilter treatment there.

They can’t blame Amazon or Apple. Sure, they can point to the Kindle, the iPad, the Amazon and iBook store (and these two behemoth companies) as what killed them, but blame? Nope. Amazon and Apple offered a great example, partnering opportunities and millions of potential buyers.

Meanwhile, how many of your friends have a Kobo reader? Did you know Borders has an iPhone reader for their Kobo ebooks? Both are food service apple pie. When you’re competing with the likes of Kindle and iPad, you have to be easier, better or cheaper.

They CAN blame C-level management. Certainly Amazon and Apple were a major challenge, but without strategic vision and execution speed, the results were obvious and inevitable. As the Inc. article notes, they had a weak online retail presence and addressed technology change as if it was a chore, not a differentiator.

Management and strategic direction just happens to be your job. How are you addressing those two things?

Serve homemade pie

You may not have to worry about Amazon or Apple, but that doesn’t mean you have nothing to worry about.

Many independent bookstores have failed in the shadow of Barnes and Noble, Borders (and later, Amazon and Apple). But NOT all of them. What makes those stores different? Why are they “immune”? The reality is, they weren’t and still aren’t immune.

The survivors didn’t stare at the door, wondering why more people aren’t randomly deciding to enter their store. They did something about it. They transformed their businesses into one that Amazon or the Apple iBook store will never be: A specialty store delivering amazing personalized service while delivering a product few others will “trouble themselves” with, within the bounds of a business plan that is designed to survive an Amazon/Apple book selling world.

Each one of them uses their online presence as a strategic advantage.

Even if you sell tractors, chainsaws and weed whackers, people are going to search online for info about you and your products. If your online presence offers them the equivalent of the food service apple pie, their next purchase might be at Chainsaws.Amazon.com.

Does your business leverage technology, or use it only when forced to?

Serve homemade apple pie.

Any single step can make or break you

Oak Leaf Raindrops
Creative Commons License photo credit: peasap

The process of returning my son’s iPod for warranty replacement has been interesting.

I talk to Costco customer service, now called “concierge service”. That experience was outstanding.

By the way, just calling it concierge service sets the expectation for a good experience, doesn’t it? It also means that you have to deliver.

The Costco guy connects me with Apple service and stays on the phone with me until I’m done, then confirms that I’m happy with the result.

The Apple customer service guy is just as good, and takes care of things quickly. He tells me that he will email me instructions and that I can just take the box to any UPS Store and they will pack and ship it at no charge.

Later, I go into the UPS Store and mention that I have an Apple return. I’m the only one in the store.

Before saying “Hello” or “So….UConn or Butler?”, the UPS store lady hears me say “Apple return” and says “Crrrrraaaaaaaaaap”.

After making a call, she took the box and said it’d be taken care of the next day, but the last impression I have for the moment – which also reflects on Costco and Apple – is….”crappy”.

I tweet something brief about it before leaving the parking lot and head for home. I’m not annoyed about it, mostly because I’ve come to expect stuff like this from retail businesses. I am a little surprised to hear that come from a woman – particularly one that I think is a generation older than me.

Rebound

By the time I get home and settled at my desk, Lindsay with UPS Store care corporate (or a fairly smart automated bot) is on top of it and sends me a Twitter message asking me to email her with details.

12 minutes later, I get a personal reply saying they’ll take care of it.

I didn’t tweet to get support from UPS. That just happened.

The point is that they were paying attention.

Paying attention

The result of paying attention means that Lindsay’s tweet and the email that followed the detailed reply she requested turned a less-than-positive last impression into a good one.

Never forget that every interaction gives you an opportunity to either reinforce/strengthen your relationship or lose a customer.

Every. Single. One.

Stuff like this is a form of marketing that’s the most expensive you’ll ever invest in: Employees.

Verizon’s pleasant surprise

Waiting For an Important Call
Creative Commons License photo credit: Sister72

Thursday was the first day of retail, walk-in Verizon iPhone sales in the U.S.

Normally a visit to our VZW store is guaranteed to consume 60-90 min, even here in rural Montana. They’re usually busy, so you sign in on a screen and they call your name in the order you arrive.

If you set your expectations at that 60-90 min, you’re not so annoyed when you finally get to leave.

Fast forward to the end of Thursday. My wife comes home, saying she wants to go get her phone.

I’m thinking “Oh man, its the first day. Its gonna be nuts.” Based on past history, I expect at least 2 hours.

The Surprise

We walk in and they are hammered. Even so, they still have 3-4 people standing around freed up, waiting for wanna-be hipsters.

We get someone right away. We pay, the Verizon guy moves her contacts from her Blackberry to the iPhone 4. The phone activates in 27 seconds and we leave in a total of 10 minutes.

TEN MINUTES. Someone put some logistics work into this rollout.

I’m FLOORED that we got in and out of their store with a phone switch in 10 minutes on the first day of retail sales, especially given that a normal day takes an hour on most occasions.

I talk to someone later and find out that after several hours in line, a guy in Seattle called to say he was still 8 blocks from the store.

10 minutes = Montana fringe benefits.

Easy like Sunday morning

First the iTunes store.

Now the Mac App Store doubles Evernote’s hourly rate of new user signups.

How many times does the forehead need slapping before it’s obvious that making it easy to buy is what it’s all about?

Make it easy to buy.

Make it easy to buy.

Make it easy to buy.

Innovation breeds profit? Who knew?

New corsair
Creative Commons License photo credit: psiaki

Profit is an evil word in many circles these days, but I used it anyway.

Are you the innovation leader in your market?

It seems to work for Apple.

Think back to your last real innovation. Yes, that one.

Remember that product or service that made customers and prospects flock to your office, store, website, trade show booth or reseller displays?

Once you got to that point, business sure did seem easy, didn’t it?

Think a little farther back. How’d you get there?

Follow the thought process that made you decide to reach out a bit more than normal.

Isn’t it worth being your market’s or even your industry’s thought leader again?

Sure makes those trips to the bank a lot more fun.

Profit vs. Market Share. You choose.

Today’s guest post is from Mark Sigal at O’Reilly, and speaks to your focus in your market.

Pay close attention to the comments about profit vs. market share.

I live in Verizon country. No AT&T here, at least not yet. All you hear and read is about how Android devices are outselling iPhone devices like crazy.

Read this for a different view of the same data.

You decide which is more important.

PS: Is it possible to lead a market by copying the current leader?

UPDATE: An alternative opinion or two.