Tuesday, July 31, 2012

Prepare for Selling to Preteens

A USA Today feature reports that hotels are developing special accommodations, menus, and activities for preteens. If you choose to sell your services and products to this age cadre, understand the distinctive psychology of preteens.
  • Research on preteens has covered various intervals between ages 7 and 14 years. I’ll discuss findings for the range 10 to 12 years. Still, these findings are broad generalizations. 
  • Preteens, more than younger children, plan for the future. Their goals take account of what they see as realistic limitations, so preteens are not as careless as teens. Related to this, preteens are more likely than teens to look to adults as role models. This is true even though the preteen may prefer to associate with age peers than with the immediate family. This means that preteens are still listening carefully to the advice of adult salespeople, even if they argue with the advice. 
  • A strong sense of right and wrong develops. Younger children are highly concerned with what’s fair, but this applies mostly to taking your turn on the swings. Preteens are more likely to get outraged by product return policies they don’t understand. 
  • Don’t treat preteen shoppers like young children, even if the preteen has not yet started the adolescent growth spurt. The sophistication of their tastes may surprise retailers who don’t recall their own preteen development. The USA Today article references an 11 year old who, commenting on a Hyatt Hotels menu, said she prefers curried shrimp lettuce wraps over cheeseburgers. 
  • Sensitivity to physical appearance increases, more so among girls than among boys. Along with this is a desire for privacy. In stores, encourage parents to allow their preteens to try on clothes alone if the fitting room is secure and if the child seems to be expressing this preference. The preteen will be grateful, and gratitude leads to store loyalty. Whereas teens can be happy trying on clothes with a few friends, preteens are less likely to be comfortable with this. 
  • Developmental psychologists note a tendency of preteens to be forgetful. In spite of looking to the future, and maybe because they feel overwhelmed looking toward their future, their organizational skills can be less than that seen when they were younger. As a retailer, write down any important commitments the preteen has made, give them a copy, and keep a copy. Also be sure the adults know what’s been agreed to. 
For your profitability: Sell Well: What Really Moves Your Shoppers

Click below for more: 
Employ Purchase Triggers for Children 
Earn Your Way into Children’s Minds

Monday, July 30, 2012

Dump Purchase Ideas into the Subconscious

Tossed-out items can make a big difference. A case in point is Edward Bernays, whose ideas influenced retailing salesmanship far in excess of the fame of his name. In fact, I’d think few retailers recognize his name. I’ll bet you’ve heard of his uncle, though. Sigmund Freud.
     What’s this have to do with discarding items? Well, the story goes that to reciprocate for a gift of cigars from his nephew, Dr. Freud sent a copy of one of his books that he’d planned to toss out. Reading the book subsequently led Mr. Bernays to believe that dumping ideas into a person’s subconscious in the proper ways would sell products, services, experiences, and ideas. Working for Procter & Gamble, General Motors, General Electric, and other businesses, he built profitability by refining the finding that people buy not so much out of need as out of a desire to express themselves.
     The notions of tossing out and dumping were relevant because the influence is greater when a retailer’s prompts are not consciously spotted by the shopper as consequential. It’s called priming.
     In common parlance, when we’re primed for an experience or action, we’re better prepared for it and therefore more receptive to it. Nag me about getting apples as I leave to buy the groceries, and I’m more likely to remember the apples. If I decide to place a special order at your store, start me out by going over the basics of how it’s done, and I’m more comfortable with the whole process.
     When consumer psychologists talk about priming a shopper, we’re usually referring to planting an idea in such a way that the customer doesn’t recognize it’s being done. Research finds that delivering the prompt below the level of awareness makes the prompt more influential over a shopper’s behavior. When a shopper is aware of the priming, they’re more likely to feel manipulated and fight back. Subconscious primes result in fewer counterarguments.
     Prefer visual prompts over verbal prompts. Research findings from University of Florida-Gainesville indicate that a consumer entering a store will become more likely to buy a product if an image of the product or package is displayed to the left of the entrance aisle.
     Other research suggests delivering the prompt in advance of the shopper entering the store. A subconscious influence is a seed inside the brain, and seeds take at least a little time to sprout.

For your profitability: Sell Well: What Really Moves Your Shoppers

Click below for more: 
Prime Your Shoppers Below Awareness 
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Sunday, July 29, 2012

Peer into Pressure from Obligation

Peer pressure boosts sales and encourages people to be socially responsible. The effects depend on you making the consumer’s behavior visible, or at least giving the impression of visibility.
     Although you can influence shopper behavior in the short-term by arousing shame, you’ll have better long-term results by aiming for a sense of obligation.
     Researchers at Arizona State University collaborated with the Holiday Inn in Tempe to place cards including recycling appeals in the 190 lodging rooms. There were three versions of the card:
  • “Help save the environment. You can show your respect for nature and help save the environment by reusing your towels during your stay.” 
  • “Partner with us to help save the environment. In exchange for your participation in this program, we at the hotel will donate a percentage of the energy savings to a nonprofit environmental protection organization. The environment deserves our combined efforts. You can join us by reusing your towels during your stay.” 
  • “Join your fellow guests in helping to save the environment. Almost 75% of guests who are asked to participate in our new resource savings program do help by using their towels more than once. You can join your fellow guests to help save the environment by reusing your towels during your stay.” 
     About one third of hotel guests receiving the first or second version hung towels on the rack, to indicate they were willing to reuse the towels. Of those receiving the third version, about half did so. Apparent visibility increased compliance.
     The third message set a social norm with its “almost 75%.” Was guilt behind the willingness to recycle towels and save a little energy for the environment as well as a little money for the Tempe Holiday Inn? To look at that issue, the researchers tried out a fourth version of the card:
  • “We're doing our part for the environment. Can we count on you? Because we are committed to preserving the environment, we have made a financial contribution to a nonprofit environmental protection organization on behalf of the hotel and its guests. If you would like to help us in recovering the expense, while conserving natural resources, please reuse your towels during your stay.” 
     The proportion of guests willing to reuse the towels was about the same as with the “almost 75%” card. It appears that what was at work could better be viewed as obligation than as guilt.

For your profitability: Sell Well: What Really Moves Your Shoppers

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Prefer Obligation to Shame 
Bundle Utility, Discount Hedonism

Saturday, July 28, 2012

Redirect Assertive Customers

Customers who are highly demanding can be a big nuisance. Sometimes, they’re impossible to completely satisfy. But a study from University of Osnabrück and University of Linz suggests that these consumers can help you build business. The tactic consists of transforming the customer’s highly demanding nature into assertive behavior and redirecting the targets from you and your staff toward the customer’s friends and family.
     Before I reveal the details, here’s a caution: The study examined psychological profiles of 417 German consumers. This is one instance where the location of the subject pool might make a big difference. Other research finds that the interactions German shoppers expect with retailers differ from expected interactions in the U.S., for instance.
     I’ve an example: When Wal-Mart opened stores in Germany, employees were expected to greet customer questions with a smiling, enthusiastic welcome. Shopper analyses showed that the customers thought this type of enthusiasm fit better with Oktoberfest than with a Wal-Mart shopping fest. The customers felt the sales help were flirting with them.
     With the caution in mind, here’s what the Osnabrück/Linz researchers found out about consumer opinion leaders in the retailing marketplace:
  • They know about specific products 
  • They are highly self-assured 
  • They demand information from those around them before making up their minds 
     Consumer researchers at University of Pittsburgh and University of Arizona used questionnaire items like the following to identify an especially influential category of opinion leaders called market mavens:
  • People ask me for information about products, places to shop, or sales 
  • I like helping people by providing them with information about many kinds of products 
  • If someone asked me where to get the best buy on several types of products, I could tell him or her where to shop 
     Based on all of this together, here are my suggestions for dealing with customers who are highly demanding:
  • Work to satisfy each one, but settle for less than perfection, if necessary. 
  • If you do break up with the customer, keep the relationship alive. Make the last memory that person has of your store one of gracious respect. 
  • With those you continue to serve, sincerely thank each for keeping you on your toes and then ask if they also are highly assertive with friends and family. If so, ask that they give a honest review of your store to those family and friends and recommend the others give your store a try. 
For your profitability: Sell Well: What Really Moves Your Shoppers

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Friday, July 27, 2012

Save the Group Hug for Familiar Customers

Mark Twain said, “Only kings, presidents, editors, and people with tapeworms have the right to use the editorial ‘we.’”
     Does that leave out retailers? What difference does it make if an individual salesperson or an ad for a store says, “Together, we can find what’s best for you,” instead of, “This store can find what’s best for you”?
     Researchers now at University of Florida, Stanford University, and Turkey’s Koç University explored when, if ever, a misplaced “we” implies an intimacy which irritates shoppers. First, they created three versions of a Wells Fargo Bank ad to use in their studies. The difference was in the wording of one sentence:
  • “Together, we make whatever decisions necessary to ensure your life goes uninterrupted.” 
  • “Together you and Wells Fargo make whatever decisions necessary to ensure your life goes uninterrupted.” 
  • “Wells Fargo makes whatever decisions necessary to ensure your life goes uninterrupted.” 
     For current customers of the bank, the first version led to the most favorable attitudes. They liked the idea of the bank and the customer acting as if one. For non-customers, the outcome was more complex. In general, the wording made no difference. Non-customers had no psychological investment in the relationship with the bank, so probably weren’t assessing the differences in the language. However, when another group of non-customers were specifically asked to pay attention to the differences, the “we” phrasing was less well received than the “you and Wells Fargo.” It seems the “we” did portray a smarmy congeniality.
     And then there are the businesses with whom even long-time customers don’t expect to be chummy. In another part of the study, the researchers found that customers of health insurer Aetna were significantly more comfortable hearing a “you and Aetna” message than a “we” message.
     Know what sort of retailer you are in the mind of the consumer. If it’s expected that you’ll maintain a professional distance to exercise independent judgment, this should be reflected in the marketing and face-to-face phrasing you use.
     Also attend to the objective. If it’s to resolve a complaint, keep your “I” on the issue to indicate corrective action is imminent. “I’ll take care of this,” is better than, “We’ll take care of this.” From another perspective, researchers at Bayer Healthcare, Columbia University, and Maastricht University suggest asking the complainer questions which include words like “you” and “your” in order to remind the consumer of their responsibilities.

For your profitability: Sell Well: What Really Moves Your Shoppers

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Mirror Responsibility at Complaint Desks

Thursday, July 26, 2012

Interact for Collaborative Consumption

Who stops at the car wash before returning a rental car? Anybody? So why were the Northeastern University and Suffolk University researchers surprised by the attitudes of Zipcar program participants? More important for our purposes, what do the research findings say about your chances as a retailer to have a profitable collaborative consumption program?
     Zipcar is an international automobile sharing program targeted to students on college campuses and people in urban areas who are resigned to never finding convenient parking spaces. Zipcar members carry an access card which unlocks a car they’ve reserved. The car’s parked in a somewhat convenient location, and the ignition key is inside.
     Because of the paid membership requirement and nature of Zipcar marketing materials, some observers conceptualized Zipcar as collaborative consumption. This name for sharing merchandise is a cut above equipment rental: Collaborative consumption is supercharged by the opportunity to learn about other users.
     The Northeastern/Suffolk researchers found that Zipcar participants felt low sense of ownership of the cars or of the Zipcar program itself. There was little evidence of brand loyalty. The members want the company to strictly enforce the rules about filling the gas tank and returning the car on schedule, but at the same time find the strict enforcement estranges them from other members.
     Seeking both savings and social interaction, many people in your target markets do want to share both product usage and responsibility for product maintenance. There’s a market for collaborative consumption. To make it work, facilitate interaction among the participating consumers.
  • If you don’t currently rent out merchandise, consider introducing rentals as a service to the community and as a source of income for your business. If you do currently rent out merchandise, rethink the most profitable ways to use that rental center as a place shoppers can try out products and then have an opportunity to purchase a used or new version. 
  • Encourage each customer to share product ratings with others on your store’s internet site, via the customers’ social media services, and through the old-fashioned, but highly powerful, medium of talking with others. 
  • For high-ticket items that might be used less than frequently, invite friends to make a group purchase. Yes, you’d prefer to sell three items rather than sell one. But with consumers’ current price sensitivity and anti-waste commitment, it might be a matter of you preferring to sell one item rather than sell none. 
For your profitability: Sell Well: What Really Moves Your Shoppers

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Wednesday, July 25, 2012

Challenge Smart Shoppers

People are stimulated by a challenge, as long as they feel equipped to prevail.
     Infomercials for Tony Horton’s P90X bodybuilding workout program challenged shoppers to experience using the product. The breakout difference with the P90X campaign was positioning the workout as so tough that only the elite could handle it.
     Consumers overall want ease of use and turnkey solutions. At the same time, researchers at Harvard University and Columbia University find that consumers who are interested in being productive in their lives are attracted to collecting the experiences a challenge will provide.
  • In retail stores. Researchers at University of Chicago found that shoppers who characterized themselves as “smart” rather than “not smart” expressed a higher preference for products they’d have to travel across town to get over equivalent products they could purchase nearby. These shoppers also evaluated products more positively when the products had been pushed back on the shelves rather than being in easy reach. 
  • In collection of donations. People who described themselves as “pioneers” dropped higher amounts of money into a charity box when they had to stretch four feet to make the contribution rather than just drop it in without stretching. This difference did not appear among people describing themselves as “followers.” 
  • In interpersonal choices. Heterosexual men were shown photos of potential female dates and asked to judge each woman’s attractiveness. Some of the photos were crystal clear, while the other photos were out of focus by 15%. Those men who had described themselves as “smooth talkers” found the women in the blurry photos to be more attractive than those in the crystal clear photos. Meeting the challenge of decoding the blurry photo added to the attractiveness. On the other hand, the men describing themselves as “shy gawkers” judged the women in the clear photos as better looking. 
     Even a challenging question can make a difference, but again, only if the consumer feels able to meet the challenge. For instance, provide distinctive advantages to your shoppers, and then ask, “What did you find sets us apart as a place to serve your needs?”
     According to research at Hong Kong University of Science and Technology, asking questions like these is useful for changing brand, item, and store preferences the consumer has been following without any real thought. Most people rise to the challenge when asked a question. They might not answer aloud, but they’ll probably start thinking.

For your profitability: Sell Well: What Really Moves Your Shoppers

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Tuesday, July 24, 2012

Expect Exceptions to 99-Ending Pricing

Knowing when general rules fail to hold gives you a retailer’s edge. For instance, what are the exceptions to setting prices that end in a 99? $3.99 looks significantly better to the consumer than $4.00. $499.00 will look more attractive to the shopper than $500.00 and will not look less attractive than $495.00, according to research on typical consumers.
     Over the years, exceptions to this “99 Ending Rule” have been discovered. New study findings from Auburn University suggest another one: If you find it’s in your best interest and in the best interest of the consumers to guide them toward a particular item, price that item to end in 99 and price the most likely alternatives to end in 00. This will make the 99-ending price look substantially more attractive than it would otherwise.
     The effect holds even if the 99-ending price is above the comparison prices.
     One application of this is when you’d like the shopper to purchase your luxury-quality private label house brand item, which is priced at more than a set of national brands. You’d price the private label item to end in 99 and price the national brand items to end in 00.
     Add this to other exceptions from 99-ending pricing:
  • Gift items. The purchaser would feel cheap spending $12.99 instead of $13.00. 
  • Indulgences. The same logic applies. When a consumer feels like splurging on herself, she doesn’t want to attend to the difference between 99 and 100. 
  • Business-to-business sales. You’ll probably be negotiating discounts based on the total size of a business order, the likelihood and likely size of future orders, and special requests made by the purchasing agent. But begin with whole-dollar pricing to make multiple quantity calculations easier. Business buyers don’t often get an urge to splurge, and even when they do, they try to tamp it down. 
  • Upgrades. A customer is more likely to choose the more expensive alternative if the prices for the two are presented as round prices instead of as just-below prices. So if the prices on the bin tags are $19.99 and $29.99, a good-better ad would list side-by-side the features of each version that are likely to be important to the purchaser and then end with, “All this for less than $20” and “All this for less than $30.” In the store, the salesperson says, “For only $10 more, here are the additional features you’d get.” 
For your profitability: Sell Well: What Really Moves Your Shoppers

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Monday, July 23, 2012

Sidestep the Sucker Punch of Internet Price

What do most shoppers want? Topping the list is competitive prices. But if you’re primarily a bricks-and-mortar (B&M) retailer, competing with the internet on price won’t work as well for you as looking at other ways to surpass online shopping in consumers’ minds. Instead of the boxing sucker punch of internet price, use the wrestling metaphor of pressure points.
     Here are some I’ve derived from consumer psychology research results and my in-store consulting:
  • Shoppers get more excited making discoveries in B&M shopping than in online shopping. Use surprise specials and have fun products next to serious products. 
  • Keep the checkout process highly efficient. B&M shoppers are much less tolerant of cross-selling and upselling when paying than are online shoppers. Do compliment shoppers on the selections they’ve made and be sure to thank them for their purchases. Both of these increase the probability of future purchases. 
  • Three of the top irritation triggers for online shoppers are difficulties in returning unwanted items, sales promotions that are unclear or seem misleading, and limited product selection. To win over shoppers to your B&M store, excel in these areas. Maintaining an abundant product selection can be challenging for the small to midsize retailer. Accepting special orders can help. So can product substitutability—products in your assortment mix which the shopper feels comfortable substituting for other products they might consider. 
  • Personalize. Your shoppers appreciate the chance to customize. What they like even more is the opportunity to personalize. So present the options to your shoppers in terms of them expressing their personal values. This counts for more with B&M than with online shoppers. Researchers at Colorado State University found that consumers choose to personalize even if it means accepting design quality inferior to what professional designers would produce. Another study concluded shoppers in a marketing atmosphere filled with fears of privacy being violated still will volunteer ample amounts of information about themselves to a retailer if they see the retailer using this to personalize the shopping experience for them. 
  • Smart retailers won’t require their customers to choose between B&M and online. Have both available. Then keep the experience as consistent as possible. Color schemes, type fonts, photos of product packaging, and more should provide a seamless transition. You might offer a few different promotions online than in the store, but having at least a little overlap between the two is useful. 
For your profitability: Sell Well: What Really Moves Your Shoppers

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Sunday, July 22, 2012

Drill Store Staff to Respond to Violence

This past week’s Aurora, Colorado movie theatre shooting spree highlights the importance of preparing your store staff and yourself for such incidents. After all, it was during a single one-week period last year that people were shot in an Amsterdam shopping mall, two grocery store employees were slain in Minnesota, and a Dollar General store in North Carolina was the site of a revenge killing.
     Train all hands both in how to promptly evacuate the store and, if evacuation isn’t safe, in how to hide people in a secure area which has telephone contact. And recall that, like all other training, you must practice the skills. Drill staff to respond to violence.
     From my past experience serving as the psychologist on hostage negotiation teams, here are a few more points:
  • Train staff to be ready to disobey usual policies if faced with the potential for violence. Some people become highly rigid in their thinking and behavior when under substantial stress. A tunnel-vision adherence to normal routines—such as questioning whether customers and staff should be allowed in a secured office with accessible cash receipts—can worsen the danger. Let staff know it’s okay to leave registers open, cabinets unlocked, their personal belongings ripe for theft, and so on. The policy is that there is a new policy for the duration of the emergency. 
  • Set a clear command hierarchy to take account of various likely contingencies. Decisive instructions are essential for avoiding unnecessary confusion. In addition, customers and staff are more likely to follow instructions delivered with decisive authority. If hostage negotiations do ensue, the negotiator will want to know unambiguously who is in charge both inside and outside the area where hostages are being held. As soon as law enforcement arrives on the scene, command is to be handed over to them. 
  • Regardless of how the incident is resolved, provide professional post-trauma counseling for staff. Have it available promptly. However, also realize that for some employees—especially those who became highly constrained in their thinking and behavior—the need for counseling may not arise for a few days or weeks. 
     This combination of thorough drills and flexible thinking can save lives. “Business owner talks gunman out of robbing store” was the front page headline in an issue of the Turlock Journal last March. To pull that off, the owner eschewed rigidity. You and your staff can do that, too.

Click below for more: 
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Saturday, July 21, 2012

Game On with Consumer Competition

Engage shoppers with game formats. It’s called “gamification.” But be sure the rules of the game favor your store profitability.
     Customers have always loved to play games used as sales promotions. Scratch-off discounts. Sweepstakes. “Design our new logo” or “Name our new service” or “Tell us in 25 words or less why you shop at our store.”
     In the early days, before it was called gamification, retailers and manufacturers concluded that there needed to be real, tangible prizes for maximum participant involvement, although the value of the prizes often could be quite modest. People got involved for the joy of the contest.
     More recently, marketers are finding that no extrinsic reward at all is needed if the excitement of the game is sufficient. This love of the game blossomed with the popularity of desktop computers and then the sorts of mobile and desktop devices shoppers use for ecommerce. The word “gaming” morphed from serving as a euphemism for “gambling” into a shorthand for “playing games on a computerized gadget.” According to AllThingsD, over one billion copies of Angry Birds have been downloaded.
     The ethos of social networking channels adds to the gamification impetus: The objective is to add as many Followers and accumulate as many Likes as you can, regardless of the quality of the tally.
     I could argue that the more traffic you have, regardless of quality, the greater the probability of profitability. Thus a gamification suggestion from University of Pennsylvania researchers is worth considering: Keep up the competition. The payoff is that your game participants will exert a greater effort.
     It was a half century ago that Avis Rent A Car System unveiled a series of ads which the trade journal Advertising Age later called one of the top ten campaigns of the 20th century. The theme of the ads: “We’re number 2 in rent a cars behind Hertz, so we try harder.”
     The Pennsylvania researchers applied their theory to an analysis of data from 60,000 basketball games, including 18,000 National Basketball Association games. They found that teams which were behind by one point at halftime were more likely to end up winning the game than were teams ahead by one point at halftime.
     Being slightly in back of the leader boosts motivation, and thereby sharpens performance. Tell game participants the point levels of one or two others who are slightly ahead of them in the tally.

For your profitability: Sell Well: What Really Moves Your Shoppers

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Friday, July 20, 2012

Differentiate Among Teen Shoppers

Teen shoppers are alike in ways important to retailers. Researchers at University of Burgundy confirmed what most would say: Clothes really count. Among a sample of 1,063 adolescents, media and music choices greatly influenced fashion choices, and the other way around. Clothing styles reflect peer influence, and the wardrobe of the teen signals to other teens the sort of people with whom associations will be welcomed.
     This stereotype appears to be more true with adolescents than with other age groups. Still, there are exceptions. Researchers at Nanjing University and Peking University found that among their sample of teens, some evidenced interpersonal attachment avoidance, preferring to shop without friends along and depending little on what friends might say to buy.
     There are also broad personality differences. Danish researchers at Syddansk Universitet and University of Southern Denmark, after studying teen consumers in 44 countries, described six market segments:
  • Thrills and chills. These teens want to have fun and spend freely. 
  • Quiet achievers. This group courts approval from adults. They have academic and/or artistic objectives. 
  • Bootstrappers. They’re rehearsing for their future as adults, and so are caretakers. 
  • Upholders. This group supports traditional cultural values. They tend to be more religious than the other groups. 
  • World savers. These teens want to share with others what they have. 
  • Resigned. Least spirited of the groups, these adolescents limit their expectations from products they buy. 
     Although not necessarily in the Resigned group, low-income teens are distinctive.
     When a teenager and her or his mother are shopping together, who will be making the primary purchase decisions? With low-income families, researchers at University of the West of England and University of Stirling suggest you look to both, but to the teen more than to the mother.
     In the study, 524 mothers answered questions about how savvy they considered their child to be at shopping for a summer holiday and for clothing the child would wear. Mothers from lower socioeconomic circumstances tended to see their children as skilled consumers who could be depended on to manage money and make wise purchase decisions. This was especially true when the child was older and female.
     When considering a list of item benefits, the teen might place them in a different order of importance than does the mother. Still, the teen’s final purchase preferences often reflect the mother’s. Both genetics and upbringing influence things like favoring innovative products and making compromise choices.

For your profitability: Sell Well: What Really Moves Your Shoppers

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Thursday, July 19, 2012

Slow Down Processing When Blaming Others

If blaming others for damage or inconvenience to your customers, present explanations in ways which slow down the processing by those receiving it. Text is better than video.
     Researchers at University of Washington, University of Illinois, and DePaul University looked at the case of a business publically announcing an error. Some of the study participants received the statement in text format, while the others received it as a video in the style of YouTube. Half the people in each group read or saw a statement, “We are fully responsible for this error because we relied on… advice….” The other half of people in each group instead got the statement, “We are not responsible for this error because we relied on…advice….”
     When the information was presented in a text format, there were no significant differences in rated trustworthiness of the business leadership, whether or not the leadership took responsibility. On the other hand, in the video format, the trustworthiness rating was about 54% higher when the leadership took responsibility than when not.
     Video gets a message out quickly and captures attention better than does text. But if you’re wanting consumers to realize an error was beyond your control because of the actions of others, you’re probably better off with a text press release.
     Better yet is to fix the problem instead of fixing the blame.
     Holding people responsible is different from fixing blame. Estimates by psychologists at New York University and University of Tulsa suggest that about 70% of retail employees will do less well in a store like yours if you put more emphasis on fixing the blame for the problem than on fixing the problem which caused the setback.
     Here are patterns commonly set off by blaming retail employees for mistakes:
  • Denies that failure has occurred or denies any responsibility for it. The employee then begins distorting everyday business occurrences so as to avoid confronting problems. 
  • Accepts some responsibility, but deflects most of the responsibility to other people or to unforeseeable circumstances. The employee then is too quick to sense only the criticism when given constructive advice. 
  • Announces their responsibility in order to brag about the corrective actions they’ve taken. The employee then aims to impress managers excessively, sabotaging teamwork. 
  • Wallows in self-blame out of proportion to their actual responsibility. The employee then overreacts to even minor mistakes, withdraws from necessary risk-taking, and prematurely labels setbacks as failure. 
Click below for more: 
Fix the Problem, Not the Blame

Wednesday, July 18, 2012

Favor Reciprocity with a Ben Franklin Effect

Since Benjamin Franklin is known to have enjoyed a good chuckle, I’ll use a silly joke to introduce the Ben Franklin Effect:
     A guy walks into a restaurant with a bunch of friends. They all sit down at a large table and begin by placing their drink orders. The guy says, “I’ll have an iced tea. And make sure the glass is clean!”
     A few minutes later, the server returns with a tray filled with beverage containers. He gazes all around the table for a moment, looking confused, then says, “Now, which one of you wanted the clean glass?”
     The Ben Franklin Effect takes its name from a story Mr. Franklin wrote about a legislator who disliked him. Mr. Franklin decided to ask the legislator to do the favor of loaning Mr. Franklin a particular book for a few days. As Ben tells the tale, this cultivated a loyalty of the legislator toward Mr. Franklin.
     Ask someone to do you a favor and, if they agree to do it, they become more loyal to you. The waiter bringing the clean glass to the guy is now more likely to be attentive to this patron’s other requests.
     Research supports the influence of the Ben Franklin Effect, and a study at Santa Clara University found that it works nicely if the favors are reciprocal: Psychology students set up a table about ten feet from the entrance to a large supermarket. On the table sat several Rice Krispy Treats, each individually wrapped. Also on the table was a plastic cup holding five pens. Attached to the front of the table was a sign announcing a bake sale.
     No prices were posted. When someone stopped to ask the price, the experiment began. In some cases, the salesperson would say, “Hold on, let me get you a fresh one.” She’d then walk about ten feet to fetch a treat, bring it back, and set it on the table. But in doing so, she’d knock over the cup of pens, making it look like an accident. The prospective customer would almost always pick up the pens, at which point the salesperson would say the price of the treat was $4.00.
     About 70% of the prospects made the purchase. This contrasts with a 36% rate when no favors were done or requested.
     Do favors for your shoppers and ask them to do small favors for you.

For your profitability: Sell Well: What Really Moves Your Shoppers

Click below for more: 
Show Your Value to Your Suppliers

Tuesday, July 17, 2012

Enrich Clients’ Savings Deposits

There are retailers who make money by having customers save money instead of spending money. These are the insurance agents, CPAs, attorneys, banks, and others who provide financial planning services.
     How to sell the idea of depositing money? Researchers at University of Southern California and University of Virginia first defined two concepts:
  • Goal specificity refers to how precise a savings goal is. “I want to save $3,000 this year” has high goal specificity. “Over the next few years, I want to save as much as possible” has low goal specificity. 
  • Construal level refers to how much the consumer is thinking about why to save and how much about how to save. 
     It might seem that people end up putting more money away if they have highly specific goals and if their thinking balances why to save with how to save. However, the researchers conclude that what makes a difference is the time horizon of the goal:
  • If the consumer has a long-range objective, such as retirement in twenty years, emphasize why they want to save and discuss specific dollar figures. What amount do they want to end up with, and what amount do they need to deposit each month to accomplish the goal? Although both are important, “why to save” counts for more than “how to save” when perseverance is required.
  • If the consumer comes with a short-term savings objective, such as making the down payment on a house, the consumer is likely to save more if moving beyond the “why” to the “how” and if encouraged to deposit as much as possible. 
     Researchers from University of Toronto asked, “Will people save more if they have multiple goals or a single goal?” At first glance, it could seem that the more goals, the more motivation to save, and therefore the more money saved.
     Surprisingly, the research finds that, in general, people with one important savings goal will deposit more. The reason turns out to do with tradeoffs. Consumers realize they can put away in savings only so much. Therefore, when they have multiple goals, the consumers spend mental energy considering the advantages and disadvantages of each goal. This process activates the “why” and leaves less energy for the “how.”
     This is okay if the client will find it easy to save. But if, as is usually the case, saving money requires the client to strictly budget, encourage the client to put primary importance on a single goal.

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Build on Couples’ Decision-Making Rituals

Monday, July 16, 2012

Theme Like You Care

The recent death of Marvin S. Traub serves as a reminder of the importance of theming in retailing. Mr. Traub retired from Bloomingdale’s as chairman and chief executive officer. During his tenure at Bloomingdale’s, he mounted a series of themed promotional events which attracted both footsteps and publicity.
     Here are what, from a shopper psychology perspective, I see as key tactics:
  • Care about the showmanship. Mr. Traub’s “Come to China” event included an entire Cantonese farmhouse at the flagship Manhattan store and rare Chinese decorative items at fourteen other Bloomingdale’s. Mr. Traub was indeed a retailing showman. His New York Times obituary says that when he began his career at Bloomindale’s in the 1950s, he’d pump up business by pretending to be a customer thrilled about the store merchandise. 
  • Care about the people. Have your staff dress to fit. Invite appropriate guests. At an event commemorating America’s Bicentennial year, Mr. Traub escorted Queen Elizabeth II and Prince Phillip through a display of Wedgwood china and reproductions of English antique furniture. 
  • Care about the selling. Bloomingdale’s has not been unceasingly profitable. At one point, the parent company filed for bankruptcy protection. Michael Gould, who succeeded Mr. Traub as chairman and CEO, re-conceptualized the themed promotions so that the pageantry didn’t get in the way of people wanting to spend their money. A Media Post article said Mr. Traub agreed with the change, given the state of retailing economics. Never let the crowds or the activities get in the way of your themed special event participants easily buying merchandise from you at any point. 
  • Care about the carry-aways. Have themed items shoppers can take with them to serve as reminders of the event and of your store. Bloomingdale’s became known for designer shopping bags. One by artist Jonah Kinigstein was based on French tarot cards in red, black and white. 
     Mr. Traub was the impresario of themed special events. Others have found profitability in themed store atmospherics. Researchers at Saint Joseph’s University say the following four themes have been especially successful:
  • Foreign country. Restaurants provide the most ready examples. Those featuring Mexican food look different from those serving Italian food, and when executed at the best, even different from restaurants serving Tex-Mex. 
  • Nature. Scheels and Bass Pro Shops showcase animals and landscapes. 
  • Cyberspace. The Apple Stores show off information and communications technologies. 
  • Spirituality. Spas and alternative healing centers incorporate abstract themes. 
Click below for more: 
Stage Special Events to Build Sales

Sunday, July 15, 2012

Convert Averages to Trends for Analyses

Are the numbers you’re using to make your business decisions overall averages that mask trends which change over time? Do the averages represent a smoothing of extremes, none of which are typical situations?
     Many owner/operators fail to even measure their store conversion rates. You measure it by counting the number of people who come into your store during a specified period, counting the number of transactions during that same period, and dividing the number of transactions by the number of people. A conversion rate of 40% means that four out of ten people who came into your store did make a purchase.
     There are four refinements I’d add:
  • Count potential buyers, not all the people who come into your store. The family of four shopping for a washing machine is highly unlikely to buy one for each family member. 
  • The benchmarks for conversion rates depend on the type of merchandise or services you sell. An art gallery might be satisfied with a 1% conversion rate, while a pharmacy would expect almost a 100% conversion rate. 
  • The size of the transaction in number of items and dollar amount of the purchase should be analyzed as well. 
  • The most accurate conversion rates track shoppers over repeat visits. On the first visit, the shopper might ask about the items; on the second visit, consider the alternatives; and on the third visit, make the selection and purchase. 
     As traffic volume goes up, the conversion rate goes down. That is mainly a function of the availability of sales help and cash/wrap access. One significant reason people in a retail store don’t buy is that they can’t get somebody to help them and they anticipate a wait to pay. Small to midsize stores usually have the same number of staff working for a whole shift, but traffic patterns vary during that shift. Research indicates that another reason for the inverse relationship between traffic volume and conversion rate is that during slower traffic times, those who do make it into the store are more likely to be interested shoppers.
     Paying attention only to average conversion rates impedes your aligning your staffing to the traffic patterns. Take samples of conversion rates at different times of day and week. Then plot the patterns.

For your profitability: Sell Well: What Really Moves Your Shoppers

Click below for more: 
Explore What’s Behind the Numbers 
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Acknowledge the Power of Cycles

Saturday, July 14, 2012

Ease Customer Adjustment for Obeying Laws

At the start of this month, following a lead of many cities worldwide, Seattle initiated a ban on single-use polyethylene plastic bags. According to a Seattle Times article, some shoppers were caught by surprise and ended up cradling items in their arms while walking to the car.
     How would your shoppers react to such legislation? Research indicates that an irritated shopper is likely to buy less and might become spiteful. Responding to another part of the Seattle law, requiring retailers to charge 5¢ for a paper bag, a Seattle Times interviewee named Alex said he’ll be driving out of town to avoid the fee.
     Alex’s temper might cool when he figures the extra costs of travel. Or just with the passage of time. Researchers at University of South Australia tracked the responses of more than 1,200 consumers to a ban on plastic bags. They found that, regardless of whether people supported or were opposed to the ban, any resistances pretty much faded away over the four-month span of the tracking study. In Seattle, a major complaint has been no more serious than the interrupted supply of free small plastic bags for use in picking up dog droppings.
     A caution from the Australia study: People who were highly supportive of the ban before it began became more spirited in expecting others to conform. That could lead to some shoppers harassing those others who do complain.
     To head off problems, ease the adjustment.
  • The Seattle law allows retailers to provide a heavy-weight plastic bag for a fee of 10¢ and small paper bags for free. Those small plastic bags used for meat, fruit, bulk items, and home-delivery newspapers are exempt, as are the large, thin plastic bags used for dry cleaning. 
  • The first day of the ban, July 1, was a Sunday, which is a busy grocery shopping day. On that day, each Safeway store in Seattle offered a free tote bag to the first 2,000 customers who asked. 
     After consumers have adjusted, a plastic-bag ban might morph into more, as it did when Asda in the UK allowed customers in some stores to pay less if they brought in their own container to purchase fabric softener.
     Again, ease the adjustment.
  • Decorate the container with the name of your store in large letters so that the container becomes a token testimonial to customer advocacy as others watch the container being filled. 
Click below for more: 
Short & Wide for Reusable Containers

Friday, July 13, 2012

Keep Technology in Its Place

A few decades ago, Springer-Verlag and McGraw-Hill Japan published a book I wrote titled Computer Confidence: A Human Approach to Computers. The book found an audience among businesspeople—including retailers—who weren’t sure about the best ways to profitably employ the new digital technologies.
     Thankfully, the book is out-of-print. What I wrote there is now so antiquated. But my inspiration for writing it boils up in my brain every once in a while. What did it this time was a report in Bloomberg Businessweek that consumers are tiring of Quick Response codes.
     Only a year ago, the popularity was growing for those small, square, maze-like matrices designed for scanning by shoppers’ smartphones, tablet computers, and other portable electronic devices. The scan produces a link to an internet URL. The number of monthly scans recorded by the industry’s leading code maker had mushroomed from 80,000 in 2009 to about one million in 2010 to about two million by mid-2011. In December 2011, QRs appeared in more than 8% of all magazine ads, up from fewer than 4% at the start of that year.
     Loads of consumers were moving from “What the devil is this?” to “What fun this is!” Social psychology research findings indicated the consumer dynamic gave retailers a wonderful opportunity to build good will by coaching customers to teach friends and families how to use QRs.
     What’s turning interest around these days is that as the novelty wore off, the content frequently failed to stay engaging. Scan the QR and you ended up at the home page of the store or brand’s website, and there wasn’t much exciting there. The little maze was used as evidence that a store was technologically savvy rather than as a tool for showing an instructional video or doing something else valuable to the shopper. The BBW article tells of the boxes appearing, unscannable, on a highway billboard and inside a liquor bottle.
     On the other hand, some retailers are using the technology in ways that do add value. Quiring Monuments in Seattle can engrave a QR code into a tombstone so that a scan links to a website the departed family sets up.
     Retailers are being encouraged to embrace technology even further than now. My advice is, in doing it, be sure the technology is never just an answer in search of a meaningful question. Leave that to Alex Trebek on “Jeopardy.”

Click below for more: 
Keep Your Ecommerce Easy to Use 
Unveil Quick Response Codes Through Shoppers

Thursday, July 12, 2012

Qualify Your Customers by Interacting

Want to swindle your shoppers? Then learn from the business model of the Nigerian 419 Scam. This is one of those where the target of the swindle gets an e-mail saying that if the target sends money or their bank account information, they’ll get an unbelievably large amount in return. It’s called the “Nigerian 419 Scam” because the e-mail solicitation comes from Nigeria and the section in the Nigerian criminal code forbidding the scam is numbered 419.
     But, of course, you don’t want to swindle shoppers. In this case, too, there’s something to be learned from a Microsoft Research paper titled “Why Do Nigerian Scammers Say They Are from Nigeria?”
     The answer to the question, according to the paper, is that the scammers want to qualify their prospects quickly. Because many people already know about the Nigerian Scam, an e-mail coming from Nigeria with improbable tales of West African riches and a request for the recipient to send their own riches will quickly eliminate all but the gullible.
     And it’s the gullible the perpetrators of the swindle are aiming to entice. As the Microsoft Research paper points out, a Nigerian Scam sufficiently profitable for the swindlers requires a substantial amount of back-and-forth coaxing. The maximum return comes from continuing to milk the cash cow. Only the highly gullible will stay with it long enough.
     It would seem that a lesson for retailers, whether or not they want to swindle consumers, is to have a question or two which enables retailers to discover if a shopper should be eliminated from consideration for making a profitable sale.
     Well, that might work when you’re screening thousands of prospects online. For the store-based retailer, the interaction should come from the start. It’s not one or two questions to the consumer you’ll use, but a series. Facilitate a dialogue. The question you’ll ask yourself is, “In what ways, if any, might this person be qualified to make a purchase here?,” rather than, “Is this person qualified to make a purchase here?”
     A related point: Keep your interactions sufficiently professional to protect against you unintentionally scamming shoppers: The scam e-mail generally includes poor grammar. Research at Carnegie Mellon University found that, for many consumers, poor grammar lowers the consumer’s guard, making them more susceptible to being cheated.
     A casual tone can open up shoppers to your positive influence. But a sloppy tone can be misused.

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Wednesday, July 11, 2012

Use Value Added by Third-Party Certifications

QSR reports that selected items sold by quick service restaurant chain Subway have been approved by the American Heart Association to display a mark which reads “American Heart Association Certified. Meets Criteria For Heart-Healthy Meal.”
     In addition to assisting Subway customers to avoid fatal heart attacks so they can patronize the shop in the future, displaying this sort of certificate adds comfort value to consumers for the items approved. When you have such a third-party certification, set higher profit margins on the items.
     The positive effect of a certification in the shopper’s mind spreads further than the items displaying the award. Your other items and your store itself gain prestige. People will be impressed even when selecting different products and services.
     It’s another example of the power of contagious magic in shopper psychology. Contagious magic refers to the belief—commonly encountered in consumers and usually subconscious—that two adjacent inanimate objects will exert an influence on each other. Being around the healthy items makes it seem like everything else in proximity is more healthy.
     Actually, in a reverse twist, this can increase the chances shoppers will select less healthy items.
  • A research team from City University of New York, Loyola College, and Duke University found that when a healthy salad was added to a list of side dish choices, diners separately identified as high in self-control became more likely to order the French fries. 
  • Researchers from New York University and University of Pennsylvania found that when people put into their grocery shopping cart an item touted as healthy, the people became much more likely to select an unhealthy food item next. 
  • Children 8 to 12 years old who read on-package nutritional information which positioned the product as healthy demonstrated what Boston College researchers called a “backlash effect.” The kids went on to make unhealthier choices. This was especially true when the on-package nutritional claims were general instead of specific. The type of general claim you’d find on the American Heart Association’s Heart-Check Meal Certification! 
     In other circumstances, the third-party certification does distinguish the product from others, resulting in increased consumer interest. For a period of time, Ace Hardware dealers were being advised to set higher prices on spray paints carrying an Environmental Protection Agency certification on the label, even though the supplier cost for the product was the same as the cost for spray paint not carrying the certification.

For your profitability: Sell Well: What Really Moves Your Shoppers

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Catch the Power of Contagion 
Ease the Guilt for Adult Unhealthy Eaters

Tuesday, July 10, 2012

Get Acceptance if Breakdowns Common

When you live and work in Taiwan, retailing service failures are common and consecutive. That’s the conclusion from a research team who should know. They’re based at China University of Science and Technology in Taiwan and National Taiwan University of Science and Technology.
     The researchers found that, in their situation, the strength of negative emotions after a second service failure were less than those after the first. This seems to conflict with other research which says that resolving a customer complaint after a first failure can strengthen store loyalty, but if there’s a second failure, often the bond is sharply broken.
     In my opinion, the explanation is that the consumers of Taiwan accommodate themselves to service failures. Successive failures acquaint them with the reality that tolerating breakdowns is the only game in town.
     The story, dating from the early 1900s, credited with originating the term “the only game in town” sticks any recipient of that designation with negative associations: A traveler asks the hotel desk clerk to recommend a place to play some high stakes poker. The desk clerk says, “The bar next door has high stakes poker going all the time. But I’ll tell you that the dealer there cheats people blind.”
     “My goodness, why do people from around here play poker there?,” the traveler asks.
     The clerk replies, “Well, it’s the only game in town.”
     Still, it’s not all negative. The hotel desk clerk’s answer to the traveler was incomplete. People played poker at that bar because it was the only game around going on whenever you wanted to play, and people were willing to accept losing their money in order to have fun playing cards, drinking, and socializing. The customers kept coming back because they received value, even though, with being cheated blind, they probably wouldn’t describe themselves as high in customer satisfaction.
     Researchers at Southern Methodist University, University of California-Riverside, and Boston College found that under certain circumstances, customer satisfaction has little effect on repurchase behavior. This happens with products and services you provide and products you carry which are essential commodities—like automobile repair services and groceries. It was less true when the objects of acquisition were luxury, pleasure-centered products—such as high fashion.
     If you’re selling commodities to consumers and failures are nearly inevitable, get acceptance from your customers by empathizing with the inconvenience and then preparing the customers to deal with breakdowns.

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Monday, July 9, 2012

Untangle Customers from Your Personal Battles

In the language of the transactional analysis (TA) school of psychology, “Let’s You and Him Fight” (LYAHF) refers to somebody pulling others into personal grievances.
     LYAHF came to mind during my visit inside a branch of my bank where I happened to be. As I entered, I heard a female voice gently yell “Good morning!” toward me from behind a desk. I didn’t recall having seen the woman before. How nice to be greeted so cheerfully, I was thinking.
     When I reached her desk, I explained I’d like the bank to get some of my money to Turkey’s Boğaziçi Jazz Choir. One of my colleagues, the multitalented Nur Diker, is in this year’s choir, the choir won first place in the Folklore Category at last year’s INTERKULTUR World Choir Games, the choir is competing in the 2012 games in Cincinnati this week, and I wanted to contribute a little to show my support.
     As I explained all this, the expression changed on the face of the woman behind the desk. What was a smile became a look of irritation. She said, “I’m going to have trouble helping you with that. I’m Armenian.”
     Now I was thinking, “What an error she’s making!” Like her, I looked irritated, but for a different reason. She was making reference to what’s been called the Armenian Genocide of 1915-1918, when, most researchers conclude, two million Armenians living in Turkey were deported or killed. The Turkish government has steadfastly denied responsibility. The woman behind the desk at my bank seemed irritated that I was asking her to facilitate a transaction with an organization in Turkey.
     My irritation was because I was being tangled into a grievance that, at the point I wanted to do business with my bank, was not relevant to me.
     I thought of replying, “I know that Armenians have suffered greatly. A man of Armenian ancestry named Pete Karian, a hard-working, highly successful owner/operator of a dry cleaning store, who married into my family, would talk occasionally of the horrors his grandparents endured.”
     Instead of saying that, though, I repeated my transaction request, feeling uncomfortable. What I would have said to her was genuine. But she should not have called upon me to have thought about it.
     Coach yourself and your staff to keep customers out of personal grievances unless the customers ask to be involved. Entangling them can strangle your profitability.

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Prefer Obligation to Shame

Sunday, July 8, 2012

Fan Them with the Opera

Want to transform passersby into fans of your store? Have a flash mob serenade them. If they like opera, use opera to blow them away—and toward your shelves and racks.
     A flash mob is a group of people who assemble suddenly in a public place, perform an unusual and sometimes seemingly pointless act for a brief time then disperse. Song performances in food courts and mass dancing in train stations are flash mob events many have seen on internet videos.
     When flash mobbing began, the objective was to surprise the merchants and shoppers. These days, some centers plan them. There are two reasons for this. First, retailers recognize that the performance can bring excitement to the shopping experience and publicity on the internet afterwards. Second, retailers want to avoid the evil form of the flash mob in which unwary staff go mentally numb and close down their sensory channels while the flash mob steals merchandise. Breaking into song shouldn’t lead to breaking into the store.
     Researchers at Simon Fraser University examined the effects on consumers in a public market of having a flash mob surprise shoppers by singing opera. The study compared what happened with the music presented live, the music presented from a recording, and no music.
     As expected, the live music produced more consumer arousal and more positive feelings about the shopping experience than did the other two conditions. Both these increase the potential for purchases.
     Beyond this, the flash mobs resulted in more feelings of connectedness to the shopping environment and more consumer-to-consumer interaction. The music led to passersby forming groups temporarily because of enjoyment of the music and the experience. This phenomenon, too, can increase shopping basket dollar averages.
     When people purchase in groups, each shopper’s cart tends to ring up a higher total than if those same people had shopped alone. They are more likely to make what we think of as impulse purchases. A major reason this happens is that consumers in groups become more willing to take on risks, and it is the fear of risks behind much of any resistances to buying.
     Participants in the Simon Fraser study responded positively to the opera music, overall. Clearly, plenty of other people would prefer other styles of music. The magic of the flash mob is in the surprise and the live presence. These can come with a wide range of serenade motifs.

For your profitability: Sell Well: What Really Moves Your Shoppers

Click below for more: 
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Saturday, July 7, 2012

Grant Employees Task Identity

As the shop owner looked out the front window of her store, she saw a man digging a hole in the median strip of the wide street. Then the man moved about thirty feet beyond the pile of dirt and dug another hole. When done with that one, he again moved on about thirty feet from the second dirt pile and dug a third hole.
     An hour later, she looked out the window again, only to see another man shoveling the pile of dirt back into the hole. Sure enough, after filling in the first hole, he moved on to the second hole, filled in that one, and then on to the third hole.
     The shopkeeper couldn’t contain her curiosity about what appeared to be some monumental waste of city workers’ time. She crossed the street to the median, walked up to the man filling in the third hole, and asked him to explain.
     “Oh,” he began, with a nod which indicated he’d heard the questions before. “We have a system here. My buddy digs out the dirt from the hole, my other buddy puts a tree in the hole, and then I come along and fill in the hole with the dirt.”
     “There’s no tree there!,” the woman exclaimed.
     “Yea, that guy’s out sick today. But the other two of us still have our jobs to get done.”
     Indeed, the shopkeeper had been correct in her assumption. This was a monumental waste of time.
     In your store, you’d spot such an error. But the whole hole story might serve to remind you of the risks in dividing up a task and the advantages in giving one employee what’s called “task identity.” One of your staff is responsible for planting the tree.
  • Encourage each staff member to serve the customer throughout the purchase process. By identifying with the complete task, the retail worker enhances identification with the shopper as a complete person rather than as a list of impersonal steps. 
  • When you schedule a special event at your store, assign one person the responsibility for execution. They own that event. 
  • Have a “Product of the Week” you assign to an employee who has shown interest in the product. The employee sets up the display, keeps an eye on the shelves to see the item is properly stocked, and gets a special bonus that week for sales of the product. 
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Friday, July 6, 2012

Adjust Assortment by Use Attractiveness

When should you offer shoppers a great many choices, and when should you narrow down the choices?
     For decades, consumer behavior researchers have advised that a large variety of offerings attracts shoppers, but as shoppers get closer to wanting to make a purchase, they welcome a pruning down of variety. They prefer a smaller assortment to assess.
     Researchers at University of Maryland found this advice worked well with consumers who were toiling toward a goal over time, such as in a fitness program.
     Some study participants were given evidence they were close to reaching their individual fitness goal, while others were led to believe they were far from the goal. All the participants were then shown a set of six protein items. In some cases, the items were all protein bars differing only in flavor. This was a low-variety set. The other participants—some who felt close to their goal and some who felt far from it—were presented a high-variety set that included a protein bar, a protein shake, and four other forms of protein supplement.
     Among consumers who felt far from the goal, motivation was higher when the consumer was asked to choose among the high-variety set. On the other hand, among consumers who felt close to the goal, motivation to achieve the goal was higher when the consumer was asked to choose among the low-variety set. Similar results were found with items to be used in a diabetes maintenance program and a physical rehabilitation program.
     Based on findings like these, the researchers suggested you offer a goal-seeker a broad variety of assistance items at the start and then, as the customer feels closer to achieving the goal, offer a more limited selection.
     Now research findings from Washington University in St. Louis indicate that there’s an important exception to this advice: When a purchased item will be highly attractive to use, give a limited number of choices for decisions to be made in the future and a broader variety for choices to be made soon.
     Here, the researchers considered choices among items like chocolates to eat, ice cream assortments, vacation destination packages, and labor-saving home appliances.
     Take into account the attractiveness the consumer will find when using a purchased item and the psychological distance from the selection process. This affects whether you move from presenting a larger to presenting a smaller assortment, or the other way around.

Click below for more: 
Limit Variety as Shoppers Approach Goals

Thursday, July 5, 2012

Prepare for Natural Disasters

Not that long ago, millions of homes in America were without electrical power because of a severe heat wave. This followed a series of thunderstorms and hurricane-force winds which downed power lines across a broad swath of the U.S.
     Whatever the season and the location, disasters can cut communities down. That includes the retailing communities in the area. It was not only homes which were without power, but also the shops. Yet, talking about a prior tornado which significantly damaged almost every small to midsize retail business in Joplin, Missouri, Lori Rivera, Senior Outreach Manager for the U.S. Federal Emergency Management Agency (FEMA), told a National Retail Federation conference, “Without retail, there was going to be no recovery.”
     Prepare for natural disasters:
  • Rehearse your store’s crisis management program. Recognize that consumers whose homes are destroyed or family members injured can suffer grief which leads to desperate actions. Along with gearing up to sell to your community members as much of what they desire with as few restrictions as possible, you’ll be needing to protect against hoarding and looting. 
  • While it’s fair weather times, develop good working relationships with the people you’ll depend on for information, supplies, and enforcement during a disaster. Recognize that the information will flow both ways. During 2011 North Carolina hurricanes, FEMA used what they called a “Waffle House Index” to judge the damage from the storm and the progress of recovery. The WHI measured whether the restaurant in the area was open and, if open, whether a partial or full menu was being served. Waffle House restaurants planned the limited menus in advance and set rounded prices to include tax so that change for cash purchases could be made more easily. 
  • Know in advance what shoppers will want during and just after a natural disaster, and then be ready to put it front and center. It should be easy to predict most of the list of products and services. But there can be some surprises. Some years back, Wal-Mart found that in anticipation of violent weather, sales of Strawberry Pop-Tarts grew more than did sales of batteries, and the best-selling product of all was beer. Researchers at University of Pennsylvania found that the anxiety accompanying natural disasters leads consumers to prefer postcards with thick borders around the edges to similar postcards without a thick border. They also preferred orderly shelves, uncluttered aisles, and unambiguous instructions. 
For your profitability: Sell Well: What Really Moves Your Shoppers

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Wednesday, July 4, 2012

Describe Distinctive Attributes to Experts

Guide the choices your shoppers make by discussing product attributes important to them. The number and the nature of attributes can make a difference.
     Researchers at Carnegie Mellon University and University of Southern California found that with packaged food items with which the shopper is familiar, shoppers pay the most attention to the attributes of taste and brand name, more than they do the size of the package. Researchers at University of Pennsylvania and University of Illinois-Urbana/Champaign found that across all product categories and levels of shopper familiarity with products, the attributes of color and shape have special importance.
     Researchers at University of Iowa, Northwestern University, and INSEAD-Singapore recommend describing fewer attributes to experts than to novices and emphasizing the uniqueness of attributes. In their studies with electronic products, the researchers found that consumers with limited knowledge of a product category would make choices in a store using fairly standard, easy-to-comprehend characteristics on which the various alternatives could be readily compared.
     In contrast, the expert consumers were more interested in whether any of the alternatives had fairly sophisticated features which distinguished that alternative from the other choices. They’re less likely than the novices to count up the number of features. Other research finds that if a number of alternatives receive a high quality rating on a certain attribute, the experts don’t pay as much attention to that attribute in winnowing down the choices.
     Discussion of attributes also plays a role in the categories a shopper uses, and the category in which a shopper places a product determines the comparisons they’ll make in deciding what to buy from you. If you’re selling apples, donuts, and oranges, health-oriented customers will be comparing the prices, the freshness, and other attributes of the apples with the oranges. But the convenience-first customers will be doing an apple-donut comparison.
     If you’re selling flowerpots, statuary, and seed flats, a dedicated gardener looks for the flowerpots and seed flats to be in the same shopping area. The dedicated outdoor decorator wants to compare the aesthetic attributes of the flowerpots with the statuary.
     We can guide the choices of our shoppers by the ways in which we arrange the merchandise and describe the alternatives we give the shoppers for spending their money. But it can work even better to present the alternatives in terms of the number and nature of the attributes we discover our shoppers using already.

Click below for more: 
Discuss Attributes to Guide Choices 
Be Aware How Shoppers Compare Products