August 1, 2014
By Jeffrey Ross and Patti Moloney
Although the luxury industry has slowly recovered following the 2008 U.S. housing crisis, lower retail prices combined with higher wholesale and supplier pricing is shrinking profit margins across Canada and the United States. The U.S. Chamber of Commerce reported that between January 2012 and January 2013, prices for wholesale jewellery rose by 2.4 per cent, while retail jewellery prices fell by 1.5 per cent. This troubling pattern is also playing out in Canada—we have seen this at our own store and have heard it from many retailers we work with. In order for merchants to maintain or increase profits, they have but one choice: boost sales.
Increasing your sales is no easy feat, but it is attainable when the right systems are in place. One of the most effective ways to secure a sale is by building a narrative with your customers. Connecting with clients through stories can help remove their fear of a ‘pushy salesperson’ and allow you to build a rapport that leads to sales and repeat business. Don’t be afraid to break the ice with playful banter; perhaps a relatable—not hokey—joke that evokes a laugh is all it takes. This kind of fun-loving attitude breaks down barriers and encourages the client to lower his or her guard and begin a dialogue with you.
Remember, jewellery is usually an emotional purchase and is almost always attached to a story. In a 2010 Southern Jewelry News article, retail consultant Brad Huisken notes most jewellery stores close sales for about 20 per cent of shoppers who come through the door, while averaging approximately five per cent in add-on sales. To boost sales, try building a narrative with customers by asking open-ended questions. The tired phrase, “Can I help you with anything?” won’t suffice. It allows the client to respond with a quick “No,” halting the sales opportunity in its tracks. Instead, ask what brought the customer into the store. It’s a great way to begin a friendly conversation and will help you understand who the customer is and what he or she is looking for.
Similarly, salespeople are often guilty of offering a simple hello from behind the counter while the customer browses, without any further interaction. Another scenario sees a customer waiting idly to pick up a watch repair. These are missed opportunities to build a rapport with your clients. Instead of a one-word greeting, try connecting with your customers by asking whether they have visited the store before. If they have, show them a new product you’re excited about. If it’s the customer’s first time in the store, explain the business’s merchandising point of view (MPOV)—essentially its identity—to give them a clear idea of what your store is all about and the unique services or products you offer.
Andrea Hill, owner of StrategyWerx and consultant to the jewellery industry, explains in her blog, “What’s Your Merchandising Point of View?” that an MPOV is both the physical look of the store and its values. It’s “your declaration of identity to the world of consumers, it is what your store is all about, it screams ‘come in if you like these things’ and ‘move along if you value those other things because that’s just not what we’re into here.'”
Hill points out an important, though often difficult notion for many business owners: your MPOV will both include and exclude customers “because you don’t need every customer to be successful. You just need the right customers,” she explains.
Determining who your best customers are is paramount for a successful MPOV. Hill writes that business owners need to know how their customers dress, how they spend their time and money, where they align themselves in society, and what matters most to them. By answering these questions, you can identify which customers are most suited to your business, making it easier to engage and guide the right customer through the sales process. You will also be better equipped to select merchandise that appeals to your clients, while advancing your store’s unique story, Hill explains. “This marriage of merchandise, experience, and physical (or graphical) space is the merchandise point of view, and like all marriages, it requires constant nurturing and attention to blossom and to be sustained.”
Relationship-building is not always easy, but through stories—both yours and your customers’—you can successfully build a lasting rapport with your clients. In our high-tech world, people feel more isolated than ever before; they are craving human connection. One way to reach out to your clientele is by encouraging them to share their stories on your business’s social media sites. For example, we posted the following question on our Facebook page: If you could choose the fingerprint of anyone throughout history to imprint on a charm, who would you choose? We were astounded with the heartfelt and personal responses we received. Instead of naming celebrities or world leaders, many shared stories about loved ones who had passed on. A frenzy of activity ensued, with customers ‘liking’ and ‘sharing’ each other’s posts. By asking a simple question, we sparked a genuine exchange between our business and our customers, thus furthering our relationship-building efforts.
In this new era of cutthroat competition, you and your staff must work harder than ever before to secure a sale. You must possess technical knowledge that is delivered in a compelling way. Role play is a highly effective tool to ensure your staff is fully equipped to do just that. To begin the activity, create stories your staff can use for different occasions and topics, such as bridal, Valentine’s Day, Mother’s Day, romance, etc. Role play can teach your salespeople to gain customer confidence and discover the emotional reasons that brought each client into the store. Use your monthly meetings to set the stage. One employee becomes the ‘customer,’ while one or two other employees serve him or her. Ensure you have an observer to take notes, and then let the fun begin. It should be a supportive and encouraging environment where your staff can learn, grow, and explore different approaches to connect with clients and close a sale. By allowing everyone involved to provide feedback, it becomes an inclusive form of training and an effective team-building tool.
For role play to be successful, you must follow-up the training. In addition to monthly role plays, use performance metrics to help ascertain whether any employees are struggling with the exercise. Quarterly reviews will help determine if members of your staff require additional training. When a staff member is unable or unwilling to meet your expectations, you owe it to your business to replace that person with someone who can. According to CIBJO’s “The Retailer’s Guide to Marketing Diamond Jewellery,” the ‘rule of 10’ states that, “It takes Â£10,000 worth of advertising to bring one customer into the shop for 10 minutes. It takes just 10 seconds for an inept salesperson to turn that customer away and 10 years to get that customer to come back.” An underperforming staff member can therefore have a very real negative impact on your sales.
Sometimes, despite your best efforts to engage shoppers, you will find a customer engrossed in his or her smartphone, oblivious to the in-store experience you’re offering. In a recent Google study entitled “Mobile In-store Research: How in-store shoppers are using mobile devices,” Google found 82 per cent of in-store shoppers use mobile searches to help make purchase decisions. Further, instead of speaking to a sales associate, one in three uses their mobile devices to find information. To reach this segment of clientele, businesses must optimize their websites for mobile by listing the brands they carry, highlighting current promotions, and identifying similar products the customer may be interested in. When the customer finds the same product online at a cheaper price, staff must be prepared to defend the store’s pricing by noting the exceptional service and accountability that comes with making a purchase from you.
By using the tools outlined here, you can effectively increase your sales and form lasting bonds with your customers, turning them into patrons for life.
Jeffrey Ross and Patti Moloney are a husband-and-wife duo that has used innovative thinking and technology to develop and expand their line of Dimples charms across Canada. They are also owners of Jeffrey Ross Jewellery, a retail store in Uxbridge, Ont.
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