Well, just as we started to think we were emerging from the GFC of 2009 – the worst worldwide financial crisis in something like seventy-five years – the prophets of doom are at it again, doing their best to talk us into a protracted recession. They may well be right, and it’s certainly not my field of expertise, so I’ll refrain from chiming in on the economics dialogue. However, as a committed sales professional, I am not as shy about speculating on how it is likely to impact this noble calling of ours – in particular, how it might affect the fortunes of those floor salespeople employed in small business bricks and mortar outlets (the BAMs)…
With so many dark clouds looming, we could be forgiven for thinking the worst, for allowing ourselves to be swallowed up by all the negativity. But adversity does indeed breed invention and it certainly spawns opportunity. With consumer confidence taking a battering, the role of personal selling inevitably gets redefined. Suddenly, we find it moving from backstage to spotlight.
In fact, the best news to come out of times like this is that many retail storeowners, resellers, and service providers, especially in the challenging small business specialist environment, are able to enjoy an ‘awakening’. While they are understandingly preoccupied with monitoring the mood of their local marketplace and anticipating the potential threats, many are seeing this brighter side, and are feeling encouraged to re-invent the positive aspects of their market positioning. Yes they are eying the opportunity to re-emphasise their unique selling proposition (USP). This is the one thing that can set the specialist apart: ironically it’s always there in the business mix, but it’s a shame that it is not always optimised until times get tough:
Personalised customer service
Local knowledge and back-up
For those smaller outlets who do keep their eye on the ball, it soon becomes obvious that their advantage over the larger generalist competitors, and the rapidly expanding worldwide web – is their ability to provide a combination of expert advice, and personalised customer service, topped with a serving of local knowledge and backup. Theirs is a classic example of the need to resurrect the all-important people advantage, and to promote it as their ultimate point of difference, particularly where considered purchases are concerned.
With consumer confidence frayed at the edges, prospective purchasers will be craving the kind of reassurance that can only come from the human experience. Without that person to person added-value either in-store or in the field, specialists face the daunting prospect of having lowest price become the default anchor point of their marketing proposition. They need to recognise that their online competitors don’t necessarily have it all their own way. Selling direct from a website, even with a well-composed benefit story and an attractive incentive package, can often represent little other than a price comparison. So there really are two sides to every story! Despite their obvious-cost-of-doing-business advantage, e-marketers suffer a constant headache trying to adequately differentiate their offer. In some respects, they are actually envious of their bricks and mortar adversaries.
So the ‘clicks and bricks’ scenario, combining the virtues of shop-from-home convenience with the live in-store buying experience, looks to be the most logical move for shopkeepers to share in the growth of web purchasing. A lot is being said about how online retailing will decimate the existing retail model, that how stores will simply become convenient ‘try-on’ and product demonstration showcases for the big cash register in the sky. Sure, this threat is certainly real, but just as real is the frustration of many of the aspiring e-marketers who rue the fact that they cannot offer ‘touch and feel’ local support out in the field. They see the other side, and know full well that they are just as often serving as little more than a pre-purchase product/price catalogue on behalf of their BAM competitors. Consequently, most of the smaller independent outlets have at least, and at last, written web activity into their marketing plan. Often it is no more than an enticement to visit the store, but nevertheless they are now flying the cyber flag!
While we have to concede that this consumer culture is changing rapidly, at least for now we seem to be still at the stage when the BAMs must ensure that for all but the commodity sector, their overall proposition adequately sells the added comfort, security, buyer confidence, and peace of mind that can only be experienced in the company of a competent salesperson. So, at every stage of the chain, vendors must simply get their prospects in front of a fellow human being if they want to salvage any reasonable level of gross profit return, certainly if they want to protect their full-service business model.
In response to the online challenge, many are now promoting elaborate ‘why buy from us’ market statements to deflect the price-consciousness of buyers by differentiating everything other than the price ticket. It is not surprising that these are based heavily on the benefits of personalised customer service, combining it with promotional events to put excitement and adventure back into shopping. The major shopping centre landlords and their big-brand anchor tenants have a serious responsibility too in this regard… they must ensure that the mall is seen as a ‘happening’ centre – a hive of people activity – and keep a constant flow of ‘reasons to visit’ in front of the public. Ironically, the internet threat can become the opportunity, with social networking the most effective medium for spreading the word.
It’s also interesting to note that many larger-scale resellers are now reversing their thrust into self-service delivery in favour of reinstating some good old-fashioned customer service. Around my home marketplace in Australia, many will surely try to emulate the Bunnings hardware example, heavily promoted to the public as the epitome of massive scales of economy blended with the passion and attentiveness of a dedicated shop-floor team – and, addressing both the trade and retail markets in the process. In their own words, ‘driving strong service is fundamentally important to our business’. This is a clear reversion to active rather than passive selling, and it has not been lost on the major retail banks, who are now countering their unpopular branch closures with ‘customer-friendly’ advertising and public relations campaigns aimed at restoring the people factor.
This need to have capable salespeople on hand becomes glaringly obvious when we take the time to sit down and weigh up the contribution of active personal selling within the total marketing mix. Sales managers have always been attentive to this, but it seems that of late it is an aspect that has been virtually neglected in the wider management spectrum, particularly in the department and chain store environments. I suspect it is about to get a lot more attention, because in any form of selling, we need to recognise how performance is measured – by those long-standing benchmarks that are generally accepted as the five critical sales performance variables. Total sales is always the most obvious measurement, but there are five other key performance indicators that tell us most about the live selling contribution we are making:
average transaction value
Conversion rate in particular is arguably the most important of the non-monetary benchmarks. In trade selling it reflects the success ratios from initiating contacts, to securing appointments, to closing sales. At retail, the simple relationship of sales transactions versus heads through the door is generally used as the measure. The other four are no less important either, and deserve the same recognition and attention… for, despite the many millions of dollars otherwise invested in getting goods to market, our personal interactive selling effort is the only component of that vast marketing mix which can effectively impact every one of these key performance indicators. If we happen to be the last live salesperson in the chain, it is no exaggeration to claim that the entire success of the exercise, from concept to consumption, ultimately rests on our shoulders.
It is not wise then for marketing managers to underestimate the real worth of our personal sales contribution. Despite the changing face of marketing and the relentless pursuit of cost efficiencies, it is still recognised that no corporation ever cost-saved or down-sized its way to ultimate success. It takes good marketing to deliver prospects, but it takes even better selling to convert those prospects to customers.
This is hardly one of the best-kept secrets of business – we all know that almost everything can be fixed by ‘more sales’. Selling its goods and services therefore remains the principle driver of any business enterprise, so the role of personal selling, that special kind where we are actively involved in helping our customers with their purchase decisions, has never been more important than it is right now. Combined with sound category management – the forecasting prowess to ensure ‘right product, right time’ – it could well become the saving grace for those merchants who recognise it!
Peter Drucker, considered by many the doyen of modern management, once observed ‘the aim of marketing is to make selling superfluous’. But, with due respect to Peter, it hasn’t happened yet, and despite the current climate of change, probably never will. So where does this leave the salesperson?
Well, for starters, we must concede that the combination of web shopping and the use of more attractive and informative packaging will see more and more product migrate down into the self-serve commodity category. This doesn’t necessarily spell extinction for specialist selling staff, but it will ultimately mean fewer numbers of them. Top-performing salespeople will still have a vital role to play. Concentrated further up the scale of price, complexity, and pride of ownership – clearly at the full-service end of the spectrum – they will inevitably emerge as a select band.
Up there, on that higher plane, the role will never diminish in relevance; it will maintain its capacity to deliver just rewards for those who aspire to staying in that elite company. Given the pessimistic outlook for the economy over the next couple of years, this ‘will to succeed’ factor becomes doubly important as good business managers discard the traditional performance review approach in favour of performance preview. Yes, they will be looking at performance potential rather than history, and will be earmarking those who are showing the drive and willingness to claw their way to that top shelf.
With differentiated selling looming as such a critical component of business sustenance, this will present a rare opportunity to those of us who have devoted our career to face to face selling. A lasting dedication to self-improvement – that insatiable thirst for new knowledge and inspiration – will be the key to our success!
I guess the simple message for salespeople is a rather blunt one – get good at it or get out of it!
By Keith E Rowe
In a distinguished career spanning half a century, Keith Rowe has managed the full journey from shop floor to boardroom. Along the way, he has headed the Australian sales and marketing operations for three of the world’s largest Consumer Electronics manufacturers – Toshiba, Sanyo and Sharp.