Increase Retail Sales – A Complete Guide V.1
This guide has been put together by a group of retail professionals with diverse backgrounds and a total of 65 years in the industry. It is our hope that this comprehensive guide will be the primary source to help you raise the sales of your retail business, no matter the size.
We are sure you will be able to find something useful to your specific situation below. To get the most out of this guide it is recommended to read it in full. However, we are intimately familiar with the speed of retail so please feel free to start off where you think your weaknesses are!
Table of Contents
- The Truth about the Current Retail Landscape
- Understanding Your Customers & Target Market
- How Consumer Behavior is Changing
- Measuring Consumer Sentiment
- Tips to Adapt to Breaking Retail Trends
- Customer Service Excellence
- Store Layout – Path to Purchase
- The Greatest Store Layouts
- Ambient Noise & Other Sensory Appeal
- Branding & Marketing
- Suggestive Selling
- Converting More Shoppers/ Up selling/ Cross selling
The Truth about the Current Retail Landscape
The retail landscape today has evolved, and retailers have to either keep up or get left behind. And it is important to pay close attention in order to not get caught flat-footed. Witness the struggles of Sears and K-Mart as an example of a brand that rested on its laurels for too long and got left behind.
Now today in retail, Omnichannel is the popular buzz word. In the Omnichannel age, there is no longer a question that smart retailers need to provide a seamless experience between digital and in-store channels. There is also no longer a question that online sales will continue to eat into brick & mortar sales. But there is a question regarding how long that erosion will last.
As retailers strive to provide a consistent, high quality experience across purchase channels, much has been made of the dramatic increase in the ratio of online sales in recent years. Conventional thinking holds that these sales are at the direct expense of in-store, or traditional offline channel sales. Lately, however there are some encouraging signs buried within the doom and gloom about brick & mortar sales versus the online sales onslaught.
Look especially at what we’re learning about younger customers.
Specifically, look at Millennials and Generation Z. Recent studies indicate that, yes, they are hyper-connected and very mobile. But they also value the experience in-store and, in the case of Generation Z, actually love shopping in stores! These young consumers value the in-store experience and love shopping in stores.
That’s the good news. But, if you’re going to captivate these young audiences to cultivate your next generation customers, you have to provide an experience in your stores. An exemplary experience. It has to be special, superior, meaningful. And you have to stand for something they can believe in.
Look no further than the emergence of coffee bars and actual bars popping up in grocery stores around the country. These amenities make the store visit a more pleasant experience, reduce shopper stress and keep them in the store longer.
This is also going beyond the basic block and tackle of excellent customer service. We’re talking respecting the consumer by consciously mimicking the ease of shopping found online. Making a commitment to hassle-free shopping that shows customers you value their time. Placing purposefully memorable details at key points in the shopping experience creates a subtly pleasant event. And know your “Why” – what your brand believes, so you can share it with your customers, and connect with them on a level deeper than commerce.
To successfully grow in-store sales among your next generation of customers requires a deeper relationship that feels respectful, unique and appreciative to the customer. Of course, you have to offer value, variety and service too. But today in retail, that is simply the price of entry, not the price of victory.
Understanding Your Customers & Target Market
We won’t waste your time here and express the importance of understanding your customers and target market. After all, this isn’t retail 101. What this section provides is the resources you need to stay on top of consumer behavior, things you can adjust to capitalize on cutting edge trends, and tips on how to stay in touch with your target market.
Obtaining a complete understanding of your target demographics is crucial, and will affect every marketing decision you make. Personal experiences are the goal of 2017, and we will get there, but understanding your demographics will serve as a safety net.
Consider this; Tesco is currently testing a “relaxed” checkout lane at one of its locations in Scotland, designed for older customers who prefer social interaction. This approach is likely to be appreciated by the older population, but not some of the younger ones. Tesco has a good understanding of demographics and handled the logistics to cater to all of them simultaneously. Not having this understanding, or safety net could have lead Tesco into making a costly mistake and isolating entire generations.
How Consumer Behavior is Changing
Technology is the major cause for the recent changes in consumer behavior and with it rose the term “Omni-Channel”. Which means, for the most part, anyone can buy anything from anywhere.
The good part about this radical change is that most technology platforms have built-in analytics platforms in them. Allowing you to measure, test changes, and understand how consumers interact with these platforms.
This process is high on the list when it comes to raising retail sales. Technology has shifted consumer behavior, but with the shift comes the ability to measure and get insights from data that never existed before. The retailers that master this, adapt to even newer technologies and master those too, will stay at the top.
The rise in mobile devices also allows consumers to multi-talk easily, and they are doing it more than ever. Studies conducted on this behavior so far have not uncovered positive results for our brains, but the fact remains the same. Retailers have less time to make an impact on consumers.
Digital channels are not the only success factor for retailers though. As e-commerce only makes up 8.5% of retail sales, what you do in-store is still EXTREMELY important. Your in-store marketing needs to work harder than ever to capture consumers fleeting attention and deliver a relevant message.
To sum up this section: consumer behavior is changing in such a way that to increase retail sales and profits you need to be in control of your omni-channel data and have a tight focus on your in-store marketing programs.
Measuring Consumer Sentiment
Nowhere is safe from the buy button in today’s world, so retailers have to realize that just having a customer’s attention or presence does not guarantee a sale. So what can you do? Relentlessly measure what works and what doesn’t.
A big part of this is being aware of consumer sentiment. The biggest retailers understand the value of working with a firm that specializes in this (not us, we specialize in increasing retail sales through in-store marketing).
Below are some of these firms. Keep in mind, we are not affiliated with them but visiting them will give you and idea of the benefits they could have on increasing retail sales.
For the smaller retailers, it is possible to measure consumer sentiment online by setting up keyword updates with google. This method doesn’t come with any of the machine learning, language processing, social media mining and other technology the above firms offer but it is free.
To start, visit www.google.com/alerts and input what terms you would like to monitor. Your brand should be one as well as any of your products. Google will fetch any news related to your terms allowing you to easily know what is being said about you.
The weakness in this method is that it doesn’t capture conversations on social media, making it harder to measure consumer sentiment. To surpass this problem we recommend training your social media employees to monitor consumer sentiment. This takes a more active approach to social media than most small retailers currently take but it could pay dividends.
Tips to Adapt to Breaking Retail Trends
Remember when the virtual reality game Pokemon Go came out? It served as a beacon of foot traffic to retailers lucky enough to be close to one of the games “gyms”, a real point on the virtual earth that players needed to visit. Many retailers were able to take advantage of this trend. Putting up signs letting everyone know there is a “gym” nearby, running special Pokemon Go sales and specials, and purchasing in-game lures to attract customers.
Trends that you can take advantage of come around almost constantly. It is up to you to;
- Be aware of them
- Be ready to adapt to them quickly
Adapting to breaking trends is easy for small mom & pop shops but often difficult for larger retailers. Questions of who has the authority to act on behalf of the company, corporate bureaucracy, and long turn-around times often get in the way. These are the issues you must address if you want your company to be able to adapt and take advantage of trends.
For the larger of the retailers, it is important to empower your employees and build a channel of communication to spot trends and brainstorm how individual retail locations can best leverage them. Once this is done create clear guidelines they have the freedom to move around in. Work with your corporate marketing department to do this and be aware of PR related issues.
Another fact that inhibits retailers from leveraging trends is turn-around times. Consider in-store marketing programs and signage. A retailer wants to create super bowl signs of the winning team to sell football-related merchandise. The standard practice to do this is to create two versions of the signage. You end up paying double but you get to adapt to this trend immediately. This isn’t necessary nowadays. It is possible to work with an in-store marketing company like WMG with faster turn-around times, allowing you to react at the speed of retail.
Customer Service Excellence
Unless you are that restaurant that purposefully treats its customers poorly, you are constantly trying to improve your customer service. In the digital age full of review websites this is even more important. Lucky for us, the digital age also brought along a suite of tools to help us manage customer service and deliver a truly exceptional experience.
SMS: Most consumers today prefer to receive sms text messages for customer service related communications.
CRM: Customer relationship management systems have come a long way. Arm your employees with ipads that allow them to pull up customer profiles on the fly. This will allow them to give most customers the personal experience they crave. Over 2/3rds of people are comfortable with companies using personal data in order to provide a more personal experience.
Customer Complaint and Resolution Centers: Let’s be honest here; most companies do not handle this portion of retail very well. Usually, retailers set up a call line that is designed to weed out everyone but the most determined caller. Menu after menu only for customers to get connected to a human from another country that decides they transferred to the wrong department. It’s frustrating.
We get it, though. This is a cost over necessity problem. It isn’t feasible to give every customer a direct line to one of your employees.. usually. But consider this; there is a company that you can pay to get call a number on your behalf until they get a human on the phone for you. That means there is a whole market of people that are tired of going through phone menus just to talk to a real person! Consumers are sick of your menu trees and willing to shell out money so they don’t have to deal with it. It might be time to reevaluate the way you handle customer complaints and resolutions.
Store Layout – Path to Purchase
The Best of Store Layouts
90% of customers turn right when entering your store. This means the wall or display they face, often referred to as the “power wall” should contain your most important products. Products that embody your brand, that have potential but are not getting the attention they deserve, or just your high margin products.
If your store layout encourages customers to walk a path, use signage or displays to tell them a story. It can be about what your brand stands for (we hope it stands for something), the history of your business, or really anything as long as it evokes an emotional response. Ever wonder why a good majority of super bowl commercials evoke an emotional response? It is because a huge portion of the buying decision is made subconsciously by consumers. This means that the decision is not always logical. Of course, sale signage and temporary promotions are still effective but an advanced method, one that the best retailers use, is to tell a story when your customers are walking a known path.
Pay attention to how your customers walk your store and slow them down at important areas or intersections. This could be done with free samples, an interactive display, your best signage, a literal stop sign, you get the idea.
Ambient Noise & Other Sensory Appeal
The influence the environment has long been studied for the benefit of other industries. However, “Environmental Psychology” as pertaining to retail environments has only really begun to be studied in the past 30 years or so. The field itself is rapidly expanding and young. There may be a great opportunity here to increase retail sales by commissioning your own research.
Although the field is young retailers have had success appealing to consumer senses to increase retail sales. Some retailers already have thoroughly researched and delicately arranged playlist for their stores. After all, music has been shown to easily affect the mood of consumers and therefore consumer behavior.
“The study found that retail owners who appeal to the pleasure centers of the brain (the parts that control feel-good chemicals like oxytocin, dopamine, and serotonin) and the parts of the brain that control arousal (those that release stress-response chemicals like adrenaline and cortisol), cause shoppers to behave in different ways.”
However, music is only one of the senses we can leverage to increase retail sales.
“Recently, some retailers have even gone so far as to trademark the distinct scents of their stores, arguing that it’s a critical part of their brand identity. Verizon Wireless secured a trademark for a “flowery musk” that’s pumped into its marquee stores. United Airlines filed a trademark application for its “Landing” fragrance, a mix of orange peel, sandalwood, cedar and leather. And for New York Fashion Week in 2013, three designers hired an olfactory consultant to pump out signature scents onto the runway while models walked.”
This method of increasing retail sales is the most time and money intensive but is likely to yield comparable returns in the way of;
- increasing the time customers stay in your store
- likelihood of making premium purchases
- spending more than planned