Are you willing to say, "Don’t buy that from me."?
A customer walks in the door of your boutique pet store. Even though there are four national brand "big box" pet product retailers in your vicinity, this customer chose to come to YOUR store. Cool.
She’s looking for a dog toy to keep her dog occupied during the day while she’s at work. She strolls down an aisle, picks up a pricey stuffed animal dog toy, steps up to the cash register, and pulls her wallet out of her purse.
She’s ready to make a purchase.
You, the owner, know that the stuffed animal dog toy typically gets shredded within the first half hour of playtime. Not a lot of bang for the buck.
What’s your next move? Take her money? Or advise her not to buy the product?
If you’ve read our book, you know what Mike Palmer has done many times over. And his business is growing more profitable year over year.
Whether or not you’ve read the book, we’d love to hear your strategies for this kind of scenario. Let’s hear it, entrepreneurs!!!
June 9th, 2005 at 10:46 am
Interesting post. Over the Memorial Day weekend, I went to a pool supply shop and my friend wanted to buy a plastic turtle pool toy. The employee could have said nothing and made $16 off of us, but instead, he spoke up and said the toy was known to fall apart and for us not to waste our money. Not only was that simple gesture greatly appreciated, it locked me in as a future customer and I will happily recommend that pool supplier to others.
From a business perspective, I work for a large corporation (yes, I sit in a cube farm) and the suppliers that gain the most respect and loyalty are the ones who are upfront about not being able to deliver a product, but refer us to someone who can. That also builds a strong business relationship.
Just as in life, your business can’t do everything. Being upfront and offering a referral goes a long way.
June 9th, 2005 at 11:11 am
[quote]You, the owner, know that the stuffed animal dog toy typically gets shredded within the first half hour of playtime. Not a lot of bang for the buck.[/quote]
My first question is that if you are the owner why are you selling a product that you are professing to be inferior in most cases? It’s one thing to advise the customer that their choice wouldn’t work for them when it would work for others. It’s a totally different case to tell the customer that you know the product you are stocking won’t work for just about anyone.
June 9th, 2005 at 12:33 pm
Great post guys, having worked in retail businesses before I know that my reaction would always be to educate the customer and let them make an informed decision. Maybe she’s looking for a quick snack for the dog and won’t care, but at least she’ll know the qualities of the product.
And in the long run, the lasting impression will be that you, as the owner, provided additional value by trying to impart your experience.
The strategy applies not just to retailers, but across industries. It gets to the heart of one of the key measures for any type of business - the lifetime value of a customer. The question is what is worth more - making that individual sale, or taking advantage of an opportunity to cement this person as a long-term customer who’ll buy from you again and again?
June 9th, 2005 at 3:43 pm
I agree with Howard; my first thought was, why sell the product? The owner of a boutique would have complete control over which products to offer. "
Regardless, this same situation happened to me a few days ago at my local hardware store. I was looking to purchase wood filler. I picked a new product that looked like it would be really easy to apply with little mess. The cashier asked what I was using it for and when I told him, he took me back to the aisle and picked out the wood filler I initially expected to purchase. He said the new stuff would be off the market when everyone realized how worthless it was but the corporate office decided on which products to purchase, not him. I was grateful for his intervention and will consult him on future purchases.
I always appreciate industry expertise and offer it as much as possible to my own customers.
June 9th, 2005 at 3:54 pm
[p][/p]It actually works on the service side too.
I prefer to stick to my core competencies and bring in the experts where I may be weak rather than risk providing substandard service to a client. So, rather than offer advice on investment strategies or legal issues surrounding the incorporation process (as examples) I instead refer clients to financial planners and attorneys I have worked with before and trust.
I may sacrifice short-term billings, but I know I’m building long-term relationships.
June 9th, 2005 at 10:56 pm
great stuff, everyone!
lou–very nice way to say it: "sacrifice short-term billings for long-term relationships"
stay tuned for tomorrow’s challenge. it has to do with raising money…
-Sloan bros
June 10th, 2005 at 7:49 am
Sometimes you may not know how inferior the product is until your customers start returning it. Just because you’re honest doesn’t always mean your suppliers are!
For me, it’s important to ask the customer up front, "what is your budget", or "what do you really want/expect from that". This way, I can give them the most "bang for their buck" in a product that will give them the best results in the price range they had in mind. I don’t oversell. That just shoos them away too when they find they’ve gotten had!
Explaining the truth about the products you sell, and sticking to that motto will bring you a much better clientel that’s willing to be loyal and will spend more in the long run.