Business Cents: to deliver the customer, define the experience
BOWMANVILLE, Ontario – If the retailer is truly serious about generating greater profits, Albert Marrache believes he or she must stop trying to be everything to everyone and instead decide who the customer is and then configure the experience needed to close the sale. Even if that means replacing every member of the existing sales team.
Marrache is the president and co-founder of Phoenix AMD International, a provider of extended warranties and other added-value products and services based here.
In the third episode of Business Cents, Marrache continues his conversation with Michael Knell, publisher of Home Goods Online. The theme for this segment is If you want to define the experience, you cannot do it without understanding who your customer is.
Retail is often described as a triangle, whose corners are best described as price, service and quality. The conundrum is independent retailers are usually unable to cover all three of its angles. Success is normally found when two of the three is stressed, particularly at the lower and mass market price points.
“You can’t service all three points equally,” Marrache says. “When you try to serve everybody, then attention gets focused on the low end.”
When that happens, he points out, profitability is difficult to attain and maintain. At this point, the retailer has a tough choice to make. “You have to ask yourself if you are in business to make more sales or if you are in business to make more profits,” he adds.
Once that decision is made, the question becomes “what is the experience that you want to deliver.”
And from here, comes the hard part for most independent retailers. “What are you doing with your salespeople to ensure they are delivering the experience you want them to deliver?” Marrache asks. By this he means, when interacting with the customer, the sales associate has to do more then write the ticket for the sofa she came into the store to find. She has to be presented with the tables, lamps, fabric protection and everything that goes with the sofa. If the salesperson fails to present the add-on, he is simply an order taker and isn’t maximizing the retailer’s profit opportunity.
He’s also quick to warn store owners and managers if they don’t take control over what their salespeople are doing, they are in danger of losing sales and, more importantly, profit. He also admits retailers often shy from honestly answering this question because of the difficulty they have in hiring and retaining good salespeople. It’s a fear they must overcome if they want to achieve the level of profitability they need and want.
This is an episode of Business Cents you don’t want to miss.
Each session of Business Cents also ends with some suggested reading – a book Albert recommends. In fact, the first 25 people send a question, comment or suggestion to Michael and Albert at [email protected] will get a free copy of that episode’s recommended book. (Please include your name, business affiliation and mailing address with postal code.)
The book for this episode is The Retail Revival by Doug Stevens, the Toronto-based retail consultant, speaker and author. “A really very interesting read, in terms of how he sees retail being changed,” Marrache says. “I would always recommend it. It’s something I have reread two or three times because even though I’m not in retail, my customers are in retail so its very important to understand the changes that are going in the market.”