Ready, Set…Send!

November 25, 2014 —

Have you launched an email campaign? If not, you have an amazing opportunity on your hands. According to the Direct Marketing Association, email marketing delivers the best ROI of any marketing tool. Email is better than TV, radio, newspaper, social media and even search engine marketing. Think about it: You read your email every day. Since nine out of 10 consumers check their email daily, and six out of 10 do it first thing in the morning—the inbox is where you want your message to be. But first you have to earn the right to be there.

Last month I wrote about winning strategies and common pitfalls of running an email marketing campaign. This month, I’d like to address how to get started.

First, it’s important the entire management team buy in that email marketing works. Last year companies attributed 23 percent of their total sales to email marketing and 70 percent of respondents had used a coupon they received via email in the previous month. Those numbers should get anyone’s attention. Campaigns for furniture retailers have delivered millions of dollars in annual sales, so it’s definitely worth doing.

Next, it’s important to actually launch your campaign before beginning to collect email addresses. This in counterintuitive to some with the thinking that it would be smart to collect emails first, and then once there is critical mass begin a program. The reasons this is a flawed strategy are numerous, but I’ll tell you the biggies. First, your people are not going to keep asking people for email addresses when they don’t have a good story about what it will be used for. Second is that email addresses get old and die, so you need to communicate immediately. If those two reasons aren’t enough, your messages will likely get labeled as spam when they start coming six months later because the recipients will forget they gave you permission, and that will get you black listed resulting in all of your future efforts getting labeled as spam.

When launching the program you’ll have an important decision—do you spiff or not? Since commissioned sales people will closely align their activities with their pay plan, this may be a smart move. But you have to then decide if you can accurately and easily measure their efforts, and also be able to detect fraud. Another idea is to have a kick-off contest that rewards top collection performance for a limited time. This creates some excitement and gets the new habits formed.

Speaking of salespeople, it’s absolutely critical that this group buys into your program. One of the techniques we implement with our campaigns is to make sure that all future email to that customer has the salesperson’s name included in the email. It doesn’t take long before your salespeople start seeing previous customers holding an email in their hand and asking for them by name, which will cement their new habits for life! Until then, they will need encouragement to have the faith that it’s in their best interests to ask for an email address with every sale. Be sure to “inspect what you expect” or your new program will certainly fall flat. Simply measuring and publicly posting collection percentage results may be enough to motivate competitive salespeople, but also be ready and willing to offer more training to those with challenges.

To get the best performance from your salespeople, you need to give them the proper tools. I’d highly recommend some role-playing as part of your launch. Write down the top five objections your salespeople think your customers will have, and make sure that each is addressed. One common concern is “What are you going to do with my email address?” Salespeople should be ready to answer this question with something like: “Now that you are a customer of ours, we’d like to give you the VIP treatment. About once a month you’ll hear something from us that is actually interesting, and you’ll also be invited to private events and sales that we don’t advertise to the public. And of course we never share your email address. Since you can always unsubscribe with a single click, let’s give it a try!”

In addition to your in-store efforts, you’ll need to make a decision of whether or not to collect email addresses on your website. If you have substantial web traffic, this can be an excellent way to gather prospects and then use email to get them in the door. We implement a “Super Collector” for many of our clients, which is about three times as likely to gather an email address than just having a form on your site. The Super Collector is a pop-up that asks the visitor if they would like to receive email. We have lots of tips around how to design this for best results, but mainly you should offer a great reason to sign up. You should send these new prospects several emails spaced out over a period of time on your company’s USP (unique selling proposition). By now you may be thinking about who on your executive team is going to handle email marketing. It can be a big job to shop for an email platform, implement it, and then keep it running correctly. You’ll also want to make sure your content is excellent and focused on your customers not on your company. If your messages are all about your next sale, you’ll lose the attention of your audience. With the amazing potential email marketing offers, you’ll want to make a serious commitment to your campaign. You may have a marketing executive that has experience in this area, or you may be wise to look outside your firm for a company that can do all the heavy lifting so that you can stay focused on selling furniture. Alternatively, you may look for a hybrid solution—hire a firm to get you started and then see if you can take it over.

Ken Mahar enjoyed a successful career in retail sales, including furniture, before founding Email Broadcast. That retail experience has helped him become an expert in email marketing. Learn more about email marketing at www.emailbroadcast.com or call 206-714-4767.

The Tables Have Turned

October 8, 2014 —

The Wall Street Journal reports that luxury consumers are ditching their dining rooms and turning the spaces into everything from home offices to libraries. Shelter magazines have pages devoted to revamping or repurposing your formal dining room. The National Association of Home Builders predicts that single-family homes of the future will get smaller: the average home size will be 2,150 square feet in 2015, down 250 square feet from this year and almost 400 square feet from 2007. According to the survey, most builders expect to see more great rooms—a combination of the family and living rooms that flow into the kitchen—and more eat-in kitchens and fewer formal dining rooms. This begs the question, are the dining rooms and the furniture we put in them in for some radical changes?

RetailerNOW talked with three companies that produce and/or distribute dining furniture to get more insight into the category— Mike Cohen, vice president of sales at Coaster, Bill Herren, creative director, Woodard and Adam Tilley, vice president of product at Stanley.

Before you panic and start unloading your dining room inventory, relax. Dining is not dead. It represents more than 25 percent of Coaster’s business, it’s Stanley’s second largest category (at 30 percent) and for Woodard it’s a little more than 40 percent of sales.

The dining room is evolving and so is the furniture. Über formal dining rooms are a thing of the past, according to Tilley. “In the 80s and 90s dining rooms were very formal; you needed a table pad, you were worried about scratching the surface. Folks struggle with really formal furniture,” he says. “People are shying away from that at a mass level; they still want the big table that seats 8-10 people, they just don’t want it to be stuffy.”

Coaster DiningCoaster’s Mullingan group has optional bench seating, a growing trend in dining.

The larger tables are important, people still have dinner parties and family gatherings and, as we all know, the kitchen (or kitchen/dining room combo) are always the hot spots for any soiree. Cohen says casual dining is also growing and in fact gathering tables with benches are very popular. Herren says the 48” round table is always popular, but lately they’ve also had requests for more ovals and rectangles.

Woodard is an outdoor furniture manufacturer, but they are starting to see outdoor furniture inching inside, particularly in homes with children or pets. “At premarket in Chicago I showed a dining set and people said they’d use it inside,” Herren says. “On the seating they’re using a lot more of that inside, especially on the woven because it’s virtually indestructible.”

Consumers are looking for dining options that satisfy their sense of style, meet their needs and require little maintenance. Herren says “I notice people are getting away from glass on dining tables—they want something that’s easier to take care of.”

Dining is a category retailers and vendors alike have been struggling with, Tilley says. “It’s a category that’s had its ups and downs; as an industry we’re trying to figure it out.”

So with all of that—how can retailers be successful in this category?

Cohen says his best customers offer selection. “The majors that do well will always have a full product selection with all styles.” Retailers need to have “a logical plan for good, better, best. It’s not always about price-point. As Mattress Mac says—SKU up.”

Merchandising and color, Herren says, are important. “Our best customers show it all decked out, [accessorized] to give the consumer ideas,” he says. Also, “the more color you show, even if they aren’t going to buy it that way, the more it gets their attention.”

Stanley diningFairlane, from Stanley, has several tables, including this oval that transforms into a round for smaller spaces.

Stanley DiningTilley agrees that display and merchandising are key. “When a retailer offers a $6,000-8,000 dining room table they really have to display it well. You can’t just take that table and stick it out there next to the bedroom furniture. The total room experience is so important.” He also cautions retailers not to skimp on space by trying to show a large table without its leaves—it has to make a grand statement. “Retailers who are doing well are taking a Disneyland approach to displays and are having fun with it and creating rooms consumers fall in love with.”

Stanley, Coaster and Woodard have different approaches when it comes to product roll outs.

Coaster’s new collections typically include options for living, dining and bedroom. Cohen says customers appreciate seeing these options and having the styles shown across all categories helps them make purchasing decisions.

Dining has become more important to Woodard, Herren says. When they introduce a new seating group they now introduce dining as part of the collection. “People are spending so much more money on their outdoor areas,” he says. The seating and dining don’t have to match “but they do have to blend, not different styles but different finishes and fabrics.”

Stanley takes a two-pronged approach. In the higher price-point category they roll out whole-home, 100+ piece collections, but “they are more of a collected lifestyle look,” Tilley says.

There are mixed materials and different finish options so the overall style is the same, but with different variations. “You can tell a story about a customer that lives in a home that is fully furnished with one collection that looks like a curated group that goes together,” Tilley says.

At starting price points Stanley offers portfolios, which focus strictly on categories. “This is for the retailer who might need to fill in their dining room gallery for example,” Tilley says. “It has a lot of style and value but you don’t have to buy a 100-piece collection. Louis Philippe bedrooms sell well, but not dining room, for example. This option helps our turns and the retailers’ turns and it’s easy to buy, advertise and sell.”

“Dark finishes are still hot, unique styles get attention,” Cohen says. “And commodity, inexpensive looks will always be top sellers.”

Cohen thinks the trend in dining over the next 10 years will continue with smaller dining rooms or no formal dining rooms because of new home and apartment construction, but he also sees gathering and expandable tables, well…expanding.

WoodardCasa-Dining-002_ORtdLarger options are in as Woodard’s Casa dining table shows; this table comfortably seats up to 10 people.

“People are getting bigger, so there’s a need for bigger furniture,” Herren says. “We also have more requests for a softer looking contemporary, not so angular.”

Tilley says there is a strong business in solid wood casual dining, particularly the Amish look. He admits it’s hard to figure out the category but Stanley is refocusing on dining and based on introductions at the summer Las Vegas market, he’s optimistic. He sees products that do double duty becoming even more important, for example étagères that double as bookcases or office pieces, tables used as desks or console tables that collapse into themselves or buffets that turn into media consoles. “Multi-purpose products are important.”

“We know there is business to be done there,” Tilley says. “Dining is one of the areas of the home that people are going to come back to and start spending on as we emerge from this great unpleasantness [economy]. If you figure out how to do it well, you’ll take a lot of the market share in the dining category.”

Investing in Lives

Recent immigrants Samamtu and Ismaila Yaha were able to furnish their apartment thanks to The Barnabas Network, a furniture bank in Greensboro, N.C.

October 8, 2014 —

The Furniture Bank Association of North America has more than 90 organizations around the country helping out in their communities. Retailers interested in partnering with a local bank can find a list of members at www.furniturebanks.org

Not wanting to miss anything, Betsy Reynolds took her time walking through Chattanooga Furniture Bank’s utilitarian showroom with its scuffed linoleum floor and furniture lined up in center-facing rows.

Chairs to the right, sofas to the left. A smattering of tables and mismatched chairs off to one side. There is nothing fancy to the outdated tweed and plaid furniture that fills the showroom, but try telling that to Reynolds.

“Everything’s so beautiful it’s tough to choose,” said Reynolds, a woman who knows a thing or two about toughness. After living on and off in shelters throughout Tennessee and Georgia, Reynolds was finally able to find a permanent job last spring cooking at a restaurant. The job helped her secure a year-long lease to a two-bedroom apartment.

But a roof over your head isn’t always enough. When you’re trying to get back on your feet, it helps to have a place to rest them at the end of the day.

So on a Saturday morning before work this summer, Reynolds and her two teen-aged daughters were given the chance to fill their new home with furniture: a sofa, a dinette table with three chairs and—most important to the girls—mattresses they could each call their own.

Reynolds looked at her bounty stacked in a truck and smiled. “We’re going to be living good from now on,” she said. “I don’t think the girls ever thought they’d be going to be in a place where they could sit down on a couch and call home, somewhere they’re proud of.”

Reynolds’ story plays out every day of every week in hundreds of furniture banks around the country. But for all the success stories like Reynolds, furniture banks could use some much-needed help from the home furnishings industry.

A furniture bank is no different than a food bank only the organization provides donated furniture to people or families recovering from traumatic life situations or acute financial problems. Most furniture banks offer their goods to clients who have been referred by area churches or social agencies.

The furniture must be clean and useable; the mattresses are sanitized before being turned over to their new owners. Sometimes the furniture is free to clients in need, sometimes there’s a nominal charge.

“Anyone in need we’re here to help,” said Bill Lemke, who runs the Northwest Furniture Bank in Tacoma, Wash.

Lemke started the furniture bank in 2005 after visiting a San Francisco food bank with his son and other volunteers. “It just hit me that what they were doing with food—giving it to people who needed it so it wouldn’t go to waste—could be done with furniture, too,” said Lemke, a wholesale furniture representative at the time.

Lemke eventually quit his job as a rep to dedicate himself to the furniture bank. Today Northwest Furniture Bank furnishes the homes for more than 100 needy families every month. “I liked my old job, but it doesn’t compare to what I’m doing or how I feel today,” he said. “We’re changing lives here. When you give a child or an adult a mattress to sleep on, imagine how much better they’re going to perform at work or school the next day.”

Furniture banks and home furnishings seem like a natural fit for stores seeking an outreach program in their community, but surprisingly not a lot of furniture banks and stores have relationships.

There are dozens of furniture stores within a 30-miles radius of The Barnabas Network, the furniture bank serving Greensboro, N.C., yet the store relies mostly on hotels and the community for its inventory, said Erin Stratford Owens, executive director of Barnabas Network.

“For whatever reason we haven’t built the relationships with (furniture stores) that we’d like,” Owens said. “I know they have a lot to offer us—not just in furniture, of course, but in getting our message out to people who might have items they no longer want. We’ve got to do a better job.”

Owens, Lemke and other members of the Furniture Bank Association of North America want to make that happen. “When you think about it, it’s a win-win-win for everyone involved,” he said. “The retailer is solving a problem for their customer who’s asking the question, ‘What do I do with my old furniture?’ Your furniture bank gets some much-needed inventory and that will go to a family in need. Everyone wins.”

More than a decade ago, North American Home Furnishings Association (NAHFA) member John Klopfenstein, president of John Klopfenstein Furniture in Leo, Ind., partnered with Mustard Seed Furniture Bank of Fort Wayne.

Klopfenstein offers the services of his delivery crew to any of his customers who are having furniture delivered to their home. After setting up the new furniture, the workers will deliver the old furniture to the Mustard Seed. The customer gets the tax deduction and a family in Fort Wayne gets some much-needed hope in the form of a sofa, mattress or other piece of furniture.

“It costs me a little bit of money since the drivers are on company time, but this is my community,” said Klopfenstein. “There’s more to life than constantly looking at the bottom line.”

In Dallas, Freed Furniture has a strong partnership with its local furniture bank. The showroom has plenty of signage promoting the local furniture bank and helps customers arrange delivery of their old furniture to the bank, which assists homeless veterans.

The store donates damaged and discontinued furniture to the Dallas Furniture Bank. Store owner Howard Freed even hooked up the bank to buy product at better pricing from his vendors.

“There’s such a natural fit between the bank and what we do,” said Freed. “More stores can and should be helping where they can”

Lemke said there’s another reason for home furnishings store owners to help their local furniture bank. “It’s been proven many times over that the public wants to buy from businesses that give back to their community,” he said.

Lemke said store owners can invest a lot of time and effort—such as Klopfenstein offering free delivery—or they can simply put brochures for their local furniture bank in their store to let customers know of the service.

“There’s really so many levels a store can choose to participate in,” he said. “It’s just a matter of jumping in.”

Making Social Media Work for You

October 7, 2014 —

Tim McLain is an Internet marketing expert who works with home furnishings brands and local retailers. Contact Tim at tmclain@netsertive.com. Shana Bresnahan manages online brand integrity and engagement through social media and online advertising at Riley & You. Contact Shana at shana.b@rileyandyou.com Ali Mirza is a digital marketing strategist with iSocialYou who can help with Facebook advertising and social media marketing strategy. He can be reached at ali@isocialyou.com

Facebook. Pinterest. Instagram. Blogs. Websites. Don’t forget Tumblr and Snapchat, the current social site of Millennials. And in Twitter’s case, remember to say it in 140 characters or less.

Social media marketing can be daunting for small home furnishings retailers trying to understand the opportunities. And experts warn that those who brush social media aside, saying their primary buyers are older and still read newspapers or listen to the radio, do so at their own risk.

“The 50-plus demographic is now the fast-growing user of social media, especially Facebook,” said Shana Bresnahan, social media and online marketing strategist for Riley & You, a Nashville-based agency that develops targeted and integrated marketing strategies.

If that’s surprises you, it shouldn’t. “Grandparents want to see pictures of their grandkids,” Bresnahan said.

In fact, Bresnahan added, many young people are leaving Facebook and are gravitating toward sites like Pinterest and Instagram where photo sharing is the focus. “That plays right into a retailer of home furnishing’s strong suit,” said Bresnahan.

In August, some of the nation’s top marketing and social media experts gathered in Nashville to discuss, among other things, best practices of social media. Experts urged retailers to implement a social media plan but also cautioned that social media by itself is not the answer for all of a store owner’s marketing.

“You need multiple marketing channels today that span the old tactics and the new,” said Tim McLain, senior marketing manager at Netsertive, a channel marketing technology company that brings brands like Ashley Furniture, Serta, La-Z-Boy and others together with their local retailer partners online which leads to customers walking through a retailer’s doors.

McLain said those channels “need to deliver a consistent message to reach everyone in your local market where they spend most of their time today: in front of computers, tablets and smartphones that are connected to the Internet.”

The best way to reach all ages of customers is with email, according to Ali Mirza, founder and president of iSocialYou, a social media marketing and consulting agency.

“Everyone has an email address,” said Mirza, who has worked with dozens of retailers to help them expand their social audience to generate leads and revenue from social media. “Ask them for it when they check out, start a monthly newsletter, deliver special offers—your single most valuable marketing asset is an email list. “

Mirza said retailers and customers view social media in different ways.

“As retailers we think of social media as a lead generation tool to get more sales,” he said. “Our customers want to use social media for engagement, or talk with us, ask questions, and get genuinely helpful content to help them use the things they buy from us. And yes, they also want to see baby pictures and connect with old friends. But small retailers have a place to engage with their customer base to stay top of mind at all phases of the purchasing funnel.”

Not every retailer needs to jump into social media for social media’s sake, said McLain. “It takes a large investment of time to properly do social for even a single location,” he said. “If your goal is to ramp up new customers swinging your doors to buy, put your limited marketing investment into targeting advertising that puts the right message in front of local customers the instant they’re researching a purchase from you.”

This is where search engine marketing, display banners, and mobile placements really shine. If you’re putting ads in the paper or on TV or radio, the 1 percent of those reading or listening today who are ready to buy will do research online, according to McLain.

Closing the loop between traditional and digital ads is your most lucrative opportunity, McLain said. Otherwise you’ll lose customers to your competitors who are investing in online advertising.

Smaller retailers looking for a social media presence shouldn’t simply default to Facebook. “It very much depends on what kind of retailer you are and where your audience is today,” said Bresnahan. “If you’re a unique furniture store, you may find that Pinterest is the primary site to use first. It’s very visual, lots of photos, and it’s used by more women than men who are talking about unique pieces, arts and crafts, things like this.”

Bresnahan said studies show that Pinterest is the second-biggest driver of clicks back to furniture retailer websites as a social channel. Facebook remains the biggest.

Bresnahan said retailers can tag their photos with prices and drive a buyer to their store for a specific item or category they have on display on a social media site. “I recommend picking one site and doing it really well at a deep level before thinking of adding others,” she said.

Mirza suggests Facebook as a small retailer’s best bet provided the store has one or two internal staffers handling social media. “(Facebook) is the easiest to manage and share posting rights with multiple people across lots of devices,” he said.

McLain agreed: “Facebook today is the Google of social media. It has the largest local audience and has the very best advertising targeting features of all the social sites. It’s easy to set very strict targeting parameters to be sure your message appears to local customers who’ve liked your competition, big box or local retail competitors, and set a specific budget to keep the ad alive for several days before, during, and after the event to drive added awareness.”

But McLain cautions retailers that a Facebook ad will only drive results if it’s aligned with other media buys and messaging appearing both online and in the real world during the same time period.
Mirza said another way to target locally via Facebook and Twitter is with your email list. “You can upload your list, create a promoted Tweet or Facebook ad, and have it appear to those people who have given you their email address in the past, as well as people who are ‘like’ your customers who live in the area,” he said.

Bresnahan, McLain and Mirza all agree it’s easier than many home furnishings retailers might think to get started. You’ve even got someone close by who can help, they added.

“Likely you’re already doing some kind of marketing,” said Bresnahan. “Either you’re outsourcing it or have someone doing it internally. This is your go-to resource to help you get started with social media.”

Bresnahan recommends outsourcing the work because social media is changing all the time. “Even if you have one person working on your marketing, it’s hard for them to keep up with the changes,” she said. “If you can afford to outsource it, you’ll ensure that your social channels stay up-to-date and you’re consistent with posting new content.”

Another option is to look within to your current staff. “It’s very likely that one or two of them are familiar with Facebook or Pinterest and have a natural interest in being your social media person,” said McLain.

Just be sure that you, as the store owner, are added as a manger of your social channels, along with one or two other staffers “That way when employees leave, several of you have access to your channels to keep things moving,” McLain said. “If only one person has full administration rights, you could be in big trouble.”

Mirza believes a store that has many employees who take part in a company’s social media team, gives the company a more active presence online and engages with customers more consistently.

“Your team knows how to answer the questions your customers ask most often, and can be excellent brand advocates for your store online,” Mirza said. “Be sure to turn on notifications (email and mobile) so your team is alerted when new posts appear on your channels, reviews are posted, etc.”

Responding in a timely manner is just as important, said McLain. “Your goal should be to respond to any kind of question or complaint within 15 to 30 minutes. If someone does post a complaint, respond fast and tell them that you understand their concerns, and always put the name of a person the customer can call, that person’s phone number and email address right in the response. You want to channel their potential anger to your phone or email, and be very publicly responsive to stop any additional negative posts from appearing.

Mirza said social media should be integrated into a retailer’s overall marketing plan. “Most stores are doing a little radio, some TV, and print. All of the promotions they’re running and messaging their putting out through these channels should also appear on social media sites like Facebook and Pinterest,” he said.

Coordinate upcoming sales, new product arrivals, and the rest with your team to have everything in sync, he added. And be sure to put Facebook or other links inside your ads so local customers know to Like or Follow you on social media.

You’ve got mail!

October 7, 2014 —

A recent survey found that business owners said 23 percent of their revenue came from email, up from 18 percent a year ago. While these weren’t all furniture retailers it begs the question—how much business could you be driving from a well-executed email campaign?

Email marketing can be one of the best tools in your marketing arsenal provided you follow a few fundamentals and avoid some common pitfalls. Let’s start with the fundamentals. Get these right and you’ll be giving yourself the best chance of having a winning campaign. It’s as easy as 1-2-3.

FUNDAMENTALS

1. Address your audience’s interests.
Nobody wants to receive irrelevant email. What do they have in common? What would they be excited to learn about? What would they find entertaining, funny or worthy of being forwarded? The smaller your niche (we sell organic cotton futons to women in their 30s) the easier it is to zero in on content, but that doesn’t mean if you’re a full-line furniture retailer you can give up. Dig deeper: Who is your target market and what interests do they have? Start your campaign ideas there.

2. Always add value.
Now that you have identified your audience, make sure your email content is adding value to their life. Furniture is an infrequent purchase so your email campaign has to be good enough to keep them around long enough for their next purchase. If your content is all about you, announcing yet another sale, you’ll lose them before they are ready to make their next purchase. Instead delight them with something fresh—designer decorator ideas, household how-to’s, moving tips, easy furniture repair, flea market finds. Whatever your audience would be into deliver it and they’ll love you, forward you, and stick around to read your next sales message.

3. Frequency.
I haven’t found any compelling reason for a furniture store to email its audience more frequently than once a month. That’s not a hard and fast rule, and perhaps you have an event so good that it justifies two emails, but for the most part one is enough. I know others do it (I’m looking at you, Pottery Barn), but if you want engaged readers three years from now, flooding their inbox is the wrong strategy.
If you’ve worked hard to master those three fundamentals, don’t shoot yourself in the foot by making these common pitfalls:

COMMON PITFALLS

1. Weak content.
Could you throw a great dinner party the same day you had the idea? Then why subject your potential customers to poor preparation? Relevant, compelling content takes time to research, cultivate, curate, edit and refine. If you’re trying to write this month’s email, skip it. Work on next month’s instead so you can publish something truly worthy of your audience’s attention. Their attention is valuable. Don’t waste it by rushing something out.

2. Ignoring trigger messages.
Most retailers think of email marketing as a “newsletter” only—something they send out to everyone. In reality it’s much more. With a little effort and some programming, you can easily send out automated messages that deliver true value. How about a birthday card since your finance customers all supply their birthdates? How about a reminder to turn their mattress every six months after their purchase? Maybe a “dining table repair” email one year after a dining table has been purchased. What about an adjustable bed message sent to people over a certain age who have not recently bought a mattress? You can easily set up these messages in advance, and automatically launch them each day as programmed. My research shows that automated emails have a 24-percent higher open rate and a 47-percent higher click through rate than standard emails.

3. Poor graphic design and ignoring mobile.
Why is it many retailers who live and die by design invest thousands of dollars in a beautiful showroom only to turn around and use a basic email template where they’ve simply dropped in their logo and changed a couple of colors? Those same retailers typically also have no plan for the fact that 44 percent of all emails are opened on mobile devices. Be sure to invest in a custom email template that you feel proudly conveys your brand. You’ll also want a “responsive design” that automatically responds to a small screen by resizing it’s images while keeping the text full size. Trust me, if people have to scroll and pinch and zoom on their phone, you’re going to lose them. The extra investment is going to raise your brand image considerably and you’ll get more from every email you send.

4. Not knowing when to get help.
Anyone can send out lousy emails. Just check your personal inbox for proof. If you want email to make a significant impact in your sales and you don’t have the experience in house—you may need help. It’s OK to admit that! Self-awareness is an underrated character trait. A good email marketing partner will have the graphic design, copywriting, coding and, most important, strategy that you need to be successful. It’s tough to do everything well. Why not focus on becoming the best retailer you can be and look for help with the ancillary services that can help you succeed. You may be surprised at how affordable it is when compared with the in-house effort required.

Next month, I’ll talk about basics like list building for those yet to start their campaign.

Ken Mahar had a successful career in retail sales, including furniture, before founding Email Broadcast. That retail experience has helped him become an expert in email marketing. Learn more about email marketing at www.emailbroadcast.com or call 206-714-4767.

Happy Birthday!

October 7, 2014 –

With the summer selling season behind us, and winter approaching it is time to pull up your marketing boot straps and do some more promoting and advertising.

As you may have noticed most of my marketing and inspiration comes from outside our industry. That’s not to say we don’t have our own share of creative ideas, I’m just always on the look out with my marketing radar turned on.

No matter where your store is located, how many you have, or what you sell there’s one “holiday” that’s celebrated around the world and one we can all use in our marketing. The birthday!

Think about it … every one of your customers has a birthday, which gives you a reason not only to contact them, but also to offer them something extra for their special day.

There’s great value to creating or improving an existing birthday marketing program. To help you get started, I want to share seven tips.

If you are averse to using a customer’s actual birthday, simply use their purchase date. Of course this isn’t a birthday but it is an anniversary and allows you more opportunities to promote to your customer list. All six of these steps apply to both the birthday and purchase anniversary.

1. Create a Memorable Program

The first step is to create and name your birthday program if you don’t already have one. Come up with something exceptional, fun and something you yourself would want to be a part of.

Don’t just slap something together, give it some thought and put some creativity behind the name and what you’re going to do to acknowledge a person’s birthday. If sending a gift, make it fun, different, valuable and time sensitive.

2. Collect Birthday Information

I love what they do at Famous Dave’s BBQ (and, yes, their BBQ is not bad either). They have put together their P.I.G. Club, which stands for Pretty Important Guest. I never imagined I would knowingly sign up for something that called me a P.I.G., but Famous Dave does it so well, I couldn’t resist. They offer an offline sign-up form every time you eat at their participating restaurants.

When you join the P.I.G. Club they ask you for your birthday (and that of your spouse, which is pretty smart). Then they send you valuable offers via email, including a free birthday gift.

Chances are there is somewhere in your customer or prospect funnel where you can easily ask for the date of their birth. I would not recommend asking for the year, only the month and possibly the day. Some retailers only ask for the month and then create a birthday promotion for anybody who has a birthday in that month.

Can’t wait to build up your birthday list? You can purchase an email list of local individuals with birthday information. Even though this would be “cold marketing” it still has a greater potential to get noticed by the recipient by the very fact that you’re recognizing their birthday. The key to cold mailing is to make it as personal as possible.

3. Make Facebook Work for You

Reaching out on Facebook to wish a happy birthday is easy and painless as long as they are your Facebook Friend. Once they become a friend, Facebook makes birthday information available (provided the customer supplied that information to Facebook) and you can easily send birthday greetings and special offers. This can be a powerful form of marketing for anyone who has a lot of likes and is still looking for the return on the Facebook investment. Using your Facebook friends’ birthdays is a great way to monetize your social media efforts.

4. Send a Belated Birthday Message

Most of us won’t have a problem with this one, since most of us probably forget a birthday or two from time to time. So if you find yourself behind on your birthday marketing, don’t let a month go by, send a belated birthday promotion.

5. Make Your Own Birthday Cards!

Standard birthday cards are fine, but why not make your own? Again using birthdays in your marketing is about making it a personal connection. A plain vanilla card that was obviously bought by the case does not help you make that connection.

6. Consider Other Celebrations

If you’re worried you might scare somebody who doesn’t know you or your business (e.g. cold marketing), consider celebrating your birthday, your pet’s birthday, someone famous or a local personality.

There are many different ways you can tap into the power of the most celebrated holiday in the world and it’s only limited by your imagination and willingness to do something 97 percent of business owners would never imagine doing.

Jeff Giagnocavo

 

 

Jeff Giagnocavo is co-owner of Gardner’s Mattress & More, Lancaster, PA, co-founder of Mega Mattress Margins (MegaMattressMargins.com), and he regularly speaks at industry events on successful retail strategies.

Reigning in Inventory

October 7, 2014 —

When it comes to buying merchandise, don’t just think about how much you’ll be spending. Think about how much you can save.

I was in a store recently watching the owner look over the inventory with a sales rep in tow. The rep was holding a note pad while the two of them walked each aisle and looked at the bins of parts.

The owner of the store would pull out a bin so that he could see how many of that part he had, and with a brief hesitation would say to the rep, “Give me two of this.”

You could tell much thought was being given to the process because he would occasionally correct himself: “Give me four of this … no, make that just two.”

In today’s world, that technique for ordering has given way to automation. As dealers sell furniture and home furnishings to their customers, their point of sale system tracks how many and when each item is sold. The system then calculates a frequency rate and produces a report telling the buyer how many to reorder.

This usually works, but what happens when the store has a transaction out of the ordinary. Perhaps a customer orders an abnormal quantity of something. Maybe a manufacturer ships an incorrect piece or color. The retailer decides to keep the error and does sell it but does not want to stock the item. Yet the system doesn’t know this and wants to reorder in advance of this unusual order happening again. When the merchandise does not sell, the store finds itself in an overstocked position.

Inventory control is important to any store. With most stores, inventory represents the biggest investment of money; the only possible other sizable investment being the building that houses it.
I remember attending a class on inventory control where the teacher told a story of a small mom-and-pop business. The couple began the store out of their garage and slowly grew the business to where they had the need for a shop and sizable warehouse for all the products they had added to their selection over the years.

What had started as a hobby while they worked their day jobs grew to the point they both quit and were now working full time in their store. They managed to pay off their home, the building they bought for the business and were in the process of developing a sizable nest egg for retirement.

Their method of ordering was the same as the example previously described. However, when they added their newest warehouse, the couple decided they no longer had to order on a ‘onesie-twosie’ basis. They figured they could finally order in larger quantities and get a better price.

The teacher in my class correctly asked, “Why would a business that has profited so much from ordering in a conservative manner change to another manner?”

When you are ordering merchandise there is a lot to be considered. The cost of any item is more than just the price you are paying. With many manufacturers, they have minimum quantity or minimum dollar amount for orders. Perhaps the manufacturer has a service fee for orders that do not meet this minimum. Either or both of these charges should be a component of what is referred to as the ‘landed’ cost.

For example, let’s say you order lamps. If you do not meet the minimum and incur a service fee, the cost of this fee should be added to the cost of the item before you consider the selling price.

Landed cost also refers to an item once it has arrived and is placed on the shelf in your warehouse. There is an expense your business incurs with the person taking a case or pallet off the truck, unpacking it, and placing the items on the warehouse shelf. Add to that the freight factor and/or the service fee and you likely have a very different cost for that item.

How much warehouse space does that product consume? If you look at your storage area and consider all of the operating expenses for that area, the rent or mortgage payment, you can determine a “cost per cubic foot” regardless of whether or not an item sits on the shelf. Traditional retail uses a “cost per square foot.” However, because we have shelves with items stocked above each other, we could use a cubic foot consideration.

A big consideration is the money being saved as well as the money being spent. Yes, there are savings you may have by buying in quantity. However, you have to consider what else that money could be doing for you if you did not buy so many.

This could be a sizable addition of business for the store, but only if there was money available to put the necessary parts on the shelves. Past the consideration of adding this new category of products, any inventory sitting on a shelf can become expensive.

Think about purchasing any part. Our example manufacturer gives terms of 30 days to pay for the item. If the item is sold within the 30 days, our store has received the item and received money for the item before having paid the manufacturer. We refer to this as “playing on house money” because the store has no exposure.

The other side of the scenario occurs when the store pays the manufacturer with a credit card. If the credit card is charging interest from the time of purchase, then that interest should actually be a part of the cost of the item.

If the store owner buys a dozen of an item and has that initial 30 days to pay for the twelve, then any of the items still sitting on the shelf after 30 days is also incurring interest. While this interest may not be paid to a credit card, this is interest that your money could be earning if it were doing something else for you.

Think if you were to invest that money in a money-market fund that earns 1.3 percent over a year. Now that product that is sitting on your shelves after the thirty days is costing you the opportunity to earn that amount of money.

This is not to be a long and complicated calculation that you should be doing with each and every item that you order. Instead, these examples are cause for you to think about how you buy.

Once you have paid the manufacturer and it is your money that is sitting on the shelf in the form of product, you need to ask yourself if that is the best place for your money to be sitting.

If the answer is ‘yes’, then congratulations! You have demonstrated some savvy buying decisions. If the answer is ‘no’, then as you sell down that inventory, look for other products, or ways, to get the most from the investment you have with your money.

Subscribe to Tom Shay’s e-ret@iler, a free monthly newsletter packed with tips for improving the profitability of your store, at profitsplus.org.

Flexible Financing

October 7, 2014 —

In today’s retail environment, offering consumer-financing options not only helps close sales, but it’s also often expected by your customer. Retailers who don’t offer financing options can be at a disadvantage, because it’s likely the competitor down the street does.

Retailer Advantage for NAHFA Members

Some consumer-finance program rates are based on annual sales and offer standard, non-customized programs and pricing. Working in collaboration with North American Home Furnishings Association (NAHFA), Synchrony Financial (built from GE heritage) offers low every-day rates and special financing promotions specifically designed for association members.                                                                                                         

Multiple Reduced Rate Options

Many consumers use in-store credit because they want to, not because they have to. They like having choices in both their home furnishings and the way they pay for them, and appreciate the convenience of longer, deferred interest promotion periods. Twelve-month deferred interest is a standard option, but 18- and 24-month deferred periods are also common. These longer terms and a range of holiday specials are available to NAHFA members at discounted rates.

Being able to offer your customers a choice in financing options lets them choose the one that best meets their needs and increases the likelihood that they’ll buy from you. Two main categories of financing have evolved: One offers minimum monthly payments with deferred interest and the other, equal monthly payments with no interest. Both programs are available through NAHFA.

Stimulate Repeat Purchases

Often, consumers are approved for more than their initial purchase, resulting in an ‘open to buy’ credit line that can be used at your store in the future. You can access lists of these cardholders from the Synchrony Financial Business Center and use the complementary Marketing Toolkit to build a direct mailer, inviting these loyal customers to come back and shop with you.

Additionally, applying for credit means your customers provide you with contact information, which lets you build a database for your marketing campaigns. By reaching out to this database with well-crafted messages you can drive repeat business and stimulate referrals. This can be as complex as sending a parent a flyer about a sale on youth furniture, or as simple as sending a customer a birthday card with a coupon.

No matter who your customers are, offering financing options helps build new and repeat customer relationships and close more sales. Use the NAHFA member-only discounts and rebates from the Synchrony Financial program to drive traffic, increase sales and lower your operating costs.

Call NAHFA, 800.422.3778, for complete pricing and program options. Visit the Synchrony Financial Program representatives at the Retailer Resource Center, 1st Floor Plaza Suites, at this month’s High Point Market.

Inside Coverage

September 8, 2014 —

You’re covered for fire and theft, but what about that employee you fired?

You open your mail and your chest tightens. It’s a court summons. You quickly scan it. The plaintiff is an ex-employee. Now your mind is racing along with your heart as you retrace the employee’s termination. Maybe he wasn’t performing. Maybe business had been a little off and you needed to cut expenses. It had nothing to do with discrimination or sexual harassment or any of those other problems your attorney and insurance agent told you to worry about. Your documentation is impeccable. Your employment manual is up to date. You follow a checklist for all terminations. You are in compliance with all the employment laws. Everything is in order, right? Right?

The truth is, many retailers’ human resources policies and practices aren’t perfect and that might be a problem. Even if you are spot-on, you can be sued.

The average cost to settle an employment practices liability claim can be steep. In 2012, the most recent year for data, employers paid out a record $467 million for wage and hour settlements, according to National Economic Research Associates Inc. The average compensatory award in federal employment cases last year was $490,000, according to Bloomberg Law Report. That doesn’t include attorney fees and punitive damages. The cost to your reputation can be equally destructive.

Small- to mid-size retailers are most vulnerable. They often don’t have the necessary capital to defend themselves against an employment-related suit or other resources, such as a human resources manager who keeps up with the rapidly changing employment policies.

The economic downturn and its resulting job losses have spurred the fears of employers. Litigation against employers by disgruntled former employees seeking redress for issues, both justified and unjustified, relating to their terminations continues to increase. With litigation on the rise, more employees are asking themselves if they need Employment Practices Liability Insurance (EPLI).

First, a little education: Employment Practice Liability Insurance is available to employers to help defend and respond to claims by employees for acts related to their employment. Some types of claims an employer would see coverage respond to include:

  • Wrongful dismissal, discharge or termination of employment
  • Violation of employment discrimination laws (including harassment)
  • Breach of a written or oral employment contract or implied employment contract
  • Sexual or workplace harassment of any kind
  • Wrongful demotion
  • Negligent employee evaluation
  • Wrongful deprivation of a career opportunity

As a retailer, you should know your general liability insurance does not provide coverage for these exposures. Indeed, most commercial general liability polices and workers compensation policies have very specific wording excluding coverage for these types of claims in their policy language. For the most part, the case law has upheld these exclusions with few exceptions.

Before shopping for EPLI coverage, you need to do some honest self-evaluation regarding your organization’s culture as it relates to employees. A thorough examination of your HR procedures is not only necessary from an insurance underwriting position, it is also a good risk management process to undergo on a regular basis.

Consistent evaluation can help identify potential problems before they develop and allow for corrections to be made. As a starting point, take a look at your employee handbook. It doesn’t matter if you have one or 1000 employees, a handbook is probably the single most important tool you should have in your HR toolbox.

A handbook is the best way to communicate policies to your employees and set the tone of your store. Creating—and annually updating—the manual will put your store on the right path to EPLI loss control. Besides, most insurance companies require stores to have a handbook in place as a condition of coverage.

But a handbook is just a starting point. You should examine all of your HR functions and activities. There are many HR assistance organizations available to help any size store with this review; NAHFA has one.

Once you’ve completed the self-evaluation, you can discuss the availability and make up of EPLI coverage for your store. For most retail stores, EPLI is a stand-alone policy. As with most insurance, you get what you pay for, and, thus you can affect the pricing with the coverage options you choose. Also, there is no standardization of coverage forms as with most other insurance policies, so it is important to examine specimen coverage forms carefully to denote differences in coverage.

It would be nice if, in good economic times or bad, having solid and consistent HR procedures were all you needed to reduce the chances of a claim. However, it is not a total barrier and it would be reassuring to know you have the EPLI coverage to pull out of your tool box if needed. Think of your HR procedures as a belt and EPLI coverage as your suspenders. With both in place, it will be very unlikely you’ll get caught with your pants down!

If you would like to get a quote for EPLI coverage, contact your NAHFA membership representative at membership@nahfa.org or (800) 422-3778 and Association Insurance Services can give you a quote. 

Two Stores, One Roof

September 8, 2014 —

Thinking about grabbing a drink or reading a good book? Why not visit a furniture store? While stores like Restoration Hardware are working to get people into their stores and off the Internet by encouraging product interaction thorough their new design galleries, some independent furniture stores are adding other businesses within their buildings to increase traffic.

That’s what Toms-Price Furniture in Wheaton, Ill., did. The family-owned store for mid- to high-end furniture and interior design welcomed Prairie Path Books, Gatherings & Great Reads into an existing apartment set-up within its 65,000-square-foot store.

A book lover and trained lawyer, Prairie Path owner Sandy Koropp had always wanted to open her own book shop, but found the multi-year leases that come with them too expensive. Instead she settled for hosting book events at her home or around town. One of the book events took place at Toms-Price, where Koropp was a good customer.

Furniture store owner Scott Price had originally leased out about 1,800 square feet of the store to a local builder. “It was synergistic and dove-tailed well, but they closed due to the recession,” Price said.

Koropp began hosting book events at the store this past spring. “As I took her around the store, I showed her this [empty] space and suggested she try a full blown book store,” said Price.
When Price showed Koropp the model apartment at the back of the store, she was blown away. “[Price] is an amazing community outreach model,” said Koropp. “He offered the space to me rent free. It was one of the most amazing moments of my life.”

Price’s offer was more strategic than philanthropic. Koropp gets a place to fulfill her dream while Price gets more customers walking through his front doors.

“We like the traffic,” Price said. “It’s not like the grocery business. This helps get people into our store and gives increased exposure to the brand and products we offer—accessories, furniture, mattresses. Sometimes [people] didn’t realize we sold those things. They didn’t realize the full breadth of our offering.”

Sept2014CommunityArt4Toms-Price Furniture added a bookstore inside its Wheaton, IL location creating a stronger sense of community

The store-within-a-store concept is nothing new. Department stores like Macy’s and Nordstrom sub-let retail space to cosmetic companies, who, in turn, provide their own employees. Best Buy’s arrangement with Samsung was instrumental in helping boost the store’s sagging sales. Struggling retailer J.C. Penney is taking the concept to the extreme, offering its entire stores to separate branded spaces.

However, the furniture industry, for the most part, has kept to itself. That is starting to change.

Although Koropp knew nothing about opening a bookstore, timing was on her side. She found a consultant in Florida who helped her determine inventory and bought more books and bookshelves from a Michigan bookstore that was going out of business. Prairie Path Books is open only during Toms-Price store hours, making it accessible seven days a week. Koropp also partners with Whole Foods, which conducts a series of wine, cheese and liquor seminars.

“We wanted to have an impact,” said Koropp, “and increase [human] contact and polite discussion, sharing ideas on issues while listening to a cellist or violinist and sitting on Stickley furniture that still has its price tags.” Koropp and her partners have 18 direct reports, including managers, volunteers and interns. Each serves a specific function from running point of purchase systems and book-buying to training staff and creating events. “We are a team—and we are part of the community.”

Koropp said, “The designers are delightful, even making signs for us, and the customers are the same mix as theirs. Our sales achievements have been higher than our projections.”
Price’s store also has a large room where groups—not just book lovers—can hold special events. “We like for the community to be part of the store,” he said. “We like the traffic. Furniture is a business that most people need only every seven years or so. Having the bookstore on-site [enhances] brand exposure.”

Toms-Price manager Cathy Manock agrees. “We knew it would look nice, but it is better than I imagined. It’s creative and inviting as they can sit on our furniture. I’ve heard comments from people about the great looks of the store and people have been coming back. It’s a slow start, but I think, over time, we will see more benefits.”

In Florida, John Washburn, needed a way to introduce people to the trendy, eclectic, imported furniture offerings of his Washburn Imports stores in Orlando and Sanford.

A slumping housing market in the state was hurting sales. “I was trying to figure out how to make things work,” said Washburn, who tapped into in his previous life as a bartender. Washburn built the Imperial Wine Bar in his Orlando store. “We’d serve beer and wine, and inspire people to hang out,” he said.

Washburn-11Florida retailer John Washburn, owner of Washburn Imports in Orlando and Sanford, added bars to his stores to increase foot traffic.

About 18 months ago, Washburn opened a bar in the larger Sanford space. Due to the limited number of county liquor licenses, he decided to offer a full bar. A general manager oversees both furniture stores, and another oversees both bars.

Washburn said, “The bars and the furniture stores have a good symbiotic relationship, although, at times, the staff has a hard time understanding how to avoid stepping on the toes of the other business.” However, Washburn added, “the negatives are so minor they are far-outweighed by the positives.”

To avoid furniture damage, “We keep furniture that can withstand abuse in the bar area,” said Washburn, “but problems are almost nonexistent because we attract a more mature crowd that likes to enjoy a really good beer in a relaxing atmosphere.”

A one-hour time overlap exists between the two businesses, during which people can get a glass of wine and walk around the furniture store. Half the showroom closes when the bar section opens.
The stores are built differently and, therefore, are configured differently; there is a separate entrance for the bar in each store. In Sanford, private parties can be given private areas accessed by the store door.

So far Price and Washburn are happy with the increased traffic they’ve seen in their stores. Despite his wife’s initial skepticism, Washburn says the bars “definitely have increased business in our stores.”

Price will re-evaluate Prairie Path’s sales benefit to his store in the next six months to a year. To date, neither he nor Washburn see any negatives.
Price says the bookstore’s atmosphere mirrors that of his furniture store. “You can go and browse, read, and linger there,” he says. “We want our furniture store to be like that. You can come, linger, hopefully make a purchase, but always feel welcome.”

Finding the Right Partner

When furniture store owners Scott Price and John Washburn went looking to add a store within their stores, not just any business would do. The key, both men say, is finding a business that provides overlap in your customer base.

Price says the idea of a bookstore within his Illinois store resonated with him because the two businesses share similar qualities. “They are educating people, recommending books to read, providing high-touch, high-service, and that’s very much what we do in furniture,” he said.
“We are both seeking out the customer interested in good service, quality products and a good, high-touch experience,” he says. “Theirs is a store for the book aficionado and ours is the furniture store for people who love their homes. There is a nice synergy in terms of the customer base."

Price recommends other retailers find a business that will generate a similar type of customer their store already attract, like a coffee shop. “Anything that draws customers and makes them part of a community but also a place people want to go to and go to visit,” he says.
At the book store tucked into a corner of his furniture store, “you can go and browse, read, linger; we want our furniture store to be like that. You can come, linger, hopefully make a purchase, but always feel welcome.”

Washburn, whose two furniture stores in Orlando and Sanford, Fla., include bars, says bringing two businesses together under one roof “has to be a good symbiotic fit—somewhere people want to hang out.”

“Keep people interested,” he says. “Make it a lifestyle experience that will drive people into your store. It can be coffee, mahjong or whatever.”

Currently a freelance writer, editor, and public relations consultant based in suburban Chicago, Sue Masaracchia-Roberts has more than 25 years of experience in public relations and writing. Her specialties are the fields of manufacturing and small business, healthcare, and natural and alternative medicine. Her writing has appeared in a number of newspapers and magazines, including RetailerNOW, the Chicago Tribune, NorthShore Living, Vital Times, the Business Ledger, and What’s Happening?