I’ve always believed that asking a specialty store customer, “How may I help you?” costs sales. After testing and measuring a new sales approach, I can tell you that the cost is substantial!
Let’s frame this as a positive. What is the potential revenue opportunity if your store(s) staffers stop asking the question? Well, in a $2 million store it could be anywhere from an additional $50,000 to $300,000 in sales growth.
How? I’ll explain. Studies show that customers use a two-step decision process to make a purchase. First they decide if they’re going to purchase something. If they decide they do want to purchase something, they then decide what they will purchase based on the offering and their needs and wants.
But when a customer is asked, “How may I help you?” most of the time they respond with, “Just looking.” That means salespeople are getting their customers to say out loud that they aren’t in the store to make a purchase. Now salespeople how to overcome that first decision.
I recently created and tested a sales process that changes how a customer’s purchase decision is made. The thinking is that with ecommerce sales now over $265 billion a year, the customer’s shopping and purchase decisions have changed. Retailers must grow and adapt to this change in order to survive and thrive.
While the specific approach is proprietary, I can tell you that it runs counter to most retail sales approaches. It’s also incredibly simple and effective. Most important, it ensures the staff engages in a way to maximize the customer opportunities. It also avoids any type of “Just looking” responses.
I needed to test this new approach with a retailer with multiple stores and traffic counters, so I worked with a client who already does a great job with their customers. My belief was that if it worked in their stores it would work everywhere.
In the first month we tested the new approach in a number of stores and used others as control stores. The test stores saw a substantial improvement in their customer conversion while the control stores remained flat. In the second month we then trained the staffs of the control stores in the new sales approach.
The results? The first set of stores improved their conversion by an average of 15% in two months. The second set of stores improved their conversion 14% in just one month.
Some stores improved by almost 25%. Every single store improved their conversion as a result of the new approach. 85% of the stores also grew their Average Daily Sale as well.
Here is the financial impact. If a store had a 30% conversion rate, after the test they are now converting at 34.5%. That’s all incremental sales growth on the same exact traffic. That means a $2 million dollar store with 15% conversion growth would grow sales by $300,000.
While the test was on a new sales approach, I believe it also proved that when specialty retailers avoid questions that result in a “Just looking” response from the customer they can substantially increase the conversion rate and sales.
Engaging customers without saying “How may I help you?” does require practice, coaching, and time to change the habit. The good news is that you now know that the payoff is there for the effort.
So let me ask, how much do you think you could grow your sales by changing your approach? Stop asking customers if they need help, and start engaging and delivering a better customer experience.
– Doug
A few additional points:
1. My last Four Weeks to Becoming an Extraordinary Coach and Developing a Winning Retail Team program of the year starts next week. Details are here. It could be just the tool to help you change your sales and service approach.
2. I’ll be happy to discuss how this new sales approach can impact your sales results. Please reply to this email and we will schedule a time to talk.
3. I don’t believe the growth would be as high in general merchandise stores such as a hardware store, but I do believe that asking “How may I help you?” impacts the quality of engagement.
