While many New Zealand mom and pop retailers are dreading the arrival of online giant Amazon in Australia this year, business author Ed Ludbrook suggests retailers have nothing to fear if they understand the fundamentals of doing business in today's disrupted world.
Ludbrook cut his teeth in the controversial world of multi-level marketing and, while he has since retired from the industry, he believes there's a lot conventional retailers can learn from the commission-driven sector – chief of which is that succeeding at any business isn't about selling.
“Retail isn't about selling. Retail is the skill of creating a high-performance customer base who buy the product whether you're there or not,” he says.
“There's no pushy salesperson trying to convince you to spend all your hard earned money – that's not retail,” says Ludbrook, who offers these five retail fundamentals to help mom and pop businesses get on the front foot ahead of Amazon.1. Retail is not about selling a product to anyone that walks by, it's about solving customer demand.
“If someone comes to you looking for one of your products, they're looking for help, and by showing them what you have and picking out what works best for them, you're helping them to solve a problem. It's not about selling, it's about problem-solving,” says Ludbrook.2. There are three main types of customers.
“The ‘tryers' who are the first time customers who need to be shown that your product is what they need. The ‘buyers' who come back time and time again because they know you provide a quality product and, lastly, there's the ‘advocates', who not only buy your product, but who recommend it to others because they believe in it so thoroughly.3. Retail requires 21st-century marketing to drive it.
“This isn't about getting all your products out there. It is about focusing on one lead product and using that product's buzz to attract people.
“You may have fifty really good products, but that's far too many to start with, and just confuses people. Once you have built the confidence in your brand and lead product, people will look at your other products,” says Ludbrook.4. Quality requires skill.
“A great product won't sell itself; you need skill and confidence to explain the value of the product – that's not selling or hype; just explain the facts.
“Learning how to solve customer problems in both the online and bricks and mortar environments requires skill – train your staff for the new ecosystem.5. Some people need product credibility to be able to recommend a product.
“If you want to create advocates for your business, you need customers who really believe in what they are talking about. This means it is important to educate your good customers. Nurture them and teach them in order to give them the confidence to talk about your product,” says Ludbrook.
Retail is about problem-solving and building customer loyalty through education – for both your staff and your customers, rather than pushing for sales. If you can do the first two, the sales will follow.