The Selling Equation

January 5, 2015 —

Generally speaking there are three types of home goods retail selling environments:

A) The “Live on the Traffic” Operation
B) The “Room Design” Operation
C) The “Hybrid” Operation

The “Live on the Traffic” operations typically are highly promotional and focused on closing the deal when the customer comes in the door the first time. Salespeople perform little prospecting on their own. They tend to sell from stock types of operators and offer various financing programs.

The “Room Design” operations are much less promotional. They build a following through spending a greater amount of time with each client. They don’t need the traffic counts that promotional retailers need because they generally produce a larger ticket size per customer. They tend to be special order, room planning and customer in-home focused operators.

The “Hybrid” operation, as the name implies, is a mix of these two. They have a blend of promotions to drive traffic and also offer some special order, but usually are limited on the actual in-home design services.

I have seen great successes, dismal failures and everything in between in all of these environments. So there is no right or wrong type of operation. The main thing is that you know who you are and how to improve. That’s what the sales equation will help you do. It sets the stage for improvement in your top line revenue in any selling environment. Here’s the equation:

Sales = Customer Opportunities (Traffic) x Close Rate x Average Sale

Whether you are a “Live on the Traffic” or a “Room Design” type of operation, determining the elements that make up your sales equation are a critical and a necessary part of improving it. If a promotional type operation has interactions with 2,000 customers in one month and closed 35 percent at $1,000 each on average that equals monthly sales volume of $700,000. At the other end of the spectrum, a home design operation might get the same sale results with a different mix. If they have 700 customer interactions with a 25 percent close rate and a $4,000 average ticket, they would also produce $700,000 in monthly sales volume.

The Value of Improving the Elements

I will use the first example to illustrate the impact of what a 10 percent increase in each of the elements in the equation would have on overall sales. So, customer interactions become 2,200, close rate becomes 38.5%, and average sale becomes $1,100. The result is sales of $931,700. That is a 33% increase in sales based on just a 10 percent increase in the elements.

The reason I am showing you this is to encourage you to take the first step, which is to become familiar with your sales equation. You should know these performance indicators for any given date range and definitely track it on a weekly, monthly, quarterly and annual basis for all stores, salespeople and categories.

To get the data, you will either need a software system or go through the tabulation manually in Excel. As long as your information is accurate, the resulting information will help you set a strategy to improve your top line.

Customer Opportunities (Traffic)

This can be the most challenging part. If you just ask your salespeople to report their selling opportunities to you, you will likely get mixed results. The best way that I have seen businesses get accurate traffic counts is through using a Customer Relationship Management (CRM) software system where salespeople record their customer counts. This data is compared to a visual proof traffic counting system. These two systems ensure a level of accuracy. In fact, several stores I have worked with are reporting 95 percent CRM opportunities recorded vs. traffic counts.

Traffic is one of the most important Key Performance Indicators (KPIs) in retail. I often say, “Knowing Traffic is Retail 101.” Along with being a vital part of the sales equation, it helps you judge the effectiveness of your advertising. If you executed a certain promotion, a measure of its results in bringing people to your store is seen in your selling opportunities during the promo period. Or, if you are an operation that is less promotional, the number of selling opportunities is an equally important indicator of how well the salespeople are doing in engaging their customer base.

Traffic is also an important factor in determining correct staffing levels. One of the top reasons a sales floor underperforms is not having the appropriate number of properly trained sales associates. Without traffic numbers, you may be guessing at your correct staffing level. With this, a store that lives on the traffic will need a much higher number of sales people per customer ratio than a highly design-oriented store. For example, I have seen high-traffic stores operate with 180 to 200 customers per salesperson per month and design operations operate successfully with 80 to 100. You’ll have to find the right ratio for your store.

Close Rate

Once you know your traffic, this part is fairly easy. Just take your number of sales and divide that by your selling opportunities. This will vary by the type of operation and category of merchandise, too. Categories such as mattresses or appliances, for example, should get a high close rate. Often, these are necessity purchases so closing on the first visit is important to success. I have seen verified annual close rates over 60 percent and as high as 80 percent in these categories.

Also, for operations that do not follow up with customers who are “just looking,” it is very important to focus on tracking and improving close rates as they are relying on making the sale on the first visit. Because once they’re gone, you won’t have any way to contact them.

Other operations that do more follow-up, design work and in-home visits, may have several face-to-face meetings with a customer until a sale is finally made. They may have a lower close rate overall because they are good with follow-up and actually engage their customers more often. Close rates in full-line furniture tend to be between 15 and 30 percent.

Average Sale

Finally, average sale is the total of all tickets per customer per day divided by the total volume. Whatever type of operation you run, high-end, low-end, special-order or stocking focus, average sale is a critical performance measure.

Know where you are overall in your business on a monthly and quarterly basis.

Set minimum performance standards for your sales teams to achieve overall and individually.

Constantly Implement Strategies to Improve

Whether you are a high-turn operation with an average sale of $1,000 or a room-planning operation with an average sale of $2,500, a $100 dollar improvement means exactly the same thing for each sale completed. When a business is above its break-even sales level, that extra $100 equates to typically 30 to 40 percent in extra profit. So it really matters and adds up. In the home furnishings industry, I have seen average sales range from as low as $500 to as high as $5,000.

Whatever type of operation you run, start by implementing processes to collect data so you know why your sales volume is what it is. From there you can set clear expectations for each metric to achieve your desired volume. Then you can develop a strategy for improvement. Continually tracking the sales equation will act as your report card. Keep improving your selling, marketing and customer follow-up processes. You will likely see improvements in traffic, close rate, average sale size and, of course, your overall volume of business.

David McMahonDavid McMahon is a management consultant and certified management accountant. He is director of consulting and performance groups for PROFITsystems, a HighJump product. You can reach him to discuss improving your situation at david.mcmahon@accellos.com.

Answering the Call

January 5, 2015 —

Reach out and touch someone? This 1980s advertising slogan by AT&T focused on the power of phone calls and their impact on relationships. Is the telephone in your store being used in the same way—as a powerful business tool? Is your staff effectively handling incoming calls and maximizing outgoing calls?
Furniture stores spend time, energy and money developing a marketing message designed to create a relationship or image with the consumer long before entering the store. A poorly handled phone call may dilute, muddle or even destroy that message.

For years I have been calling furniture stores. Sometimes these were stores under my supervision and others were competitors. I still call furniture stores today. Three recent phone conversations illustrate the potential to ruin a carefully crafted marketing message.

A major national furniture retailer was advertising via email a “First Time Ever Finance Offer.” Having a background in consumer financing, I was curious and picked up the phone to call the local branch. The person answering the phone identified himself as a salesperson and asked how he might be of assistance. After explaining I wanted information on this first-time offer, he informed me he had been off for a few days and not aware of the promotion. Apologizing, he asked me to hold while he gathered the information. He quickly returned saying he was sure there was a memo on the promotion, but he could not find it. He could check with his manager but the manager was busy helping another customer. Perhaps I could call back later? I never called.

I called another store about an advertised mattress. The salesman was polite and knowledgeable. He encouraged me to come in and check the mattress out. Be sure to ask for me were his parting words although we never knew each other’s name. He never introduced himself and never asked for my name. I never went to the store.

Finally there is the retailer who must feel he has addressed any possible phone issues in ways that would surely please his customers. Yes, the automated answering machine informs you that everyone is taking care of other guests and then the endless loop of options begins. Press 1 for this, 2 for that and so on up to 6 options. Of course your message is very important, the recorded voice assures you, please leave your message after the beep. I never left a message.

Often stores go to great lengths to train their staff on the features and benefits of the merchandise. They take pride in their staff’s ability to present all of the positive aspects of the furniture. They practice and train them on the selling process, from greeting to closing the sale often placing emphasis on the importance of building a relationship with the customer when they enter the store. Shouldn’t you place the same level of emphasis on training to take or make phone calls?

The telephone is a powerful extension of advertising and marketing when used correctly. Improper or untrained telephone usage may be threatening your business one call and one customer at a time. Surely there are many calls that go smoothly but what is acceptable? Are seven out of 10 well-handled phone calls an acceptable rate? Isn’t every phone call important?

Countless courses and training tools are available for the proper use of the telephone. One that I reviewed covered more than 50 unique phone scenarios and how to handle them, but I’m not sure the person who developed this particular training ever managed or worked in a busy furniture store.

Instead, here are practical solutions for training and using the phone in your store.

Answer phone calls promptly and preferably by a human not a recorded message. An unanswered phone sends the message to the caller that you may be short staffed or not interested in new business. Customers in the store hearing the incessant ringing phone must be thinking, why don’t they answer the phone? Establish a maximum number of allowable rings by which a call is to be answered. I suggest no more than four rings.

If you must use an automated system keep it short, simple and promptly return calls to any messages.
Standardize the greeting used to answer the phone but steer away from long mandatory scripts. In today’s technology-driven world, customer patience levels are shortening. Have you ever experienced the drone of a long-winded and uninspired script that employees have been asked to use?

Before beginning a shift, bring employees up to speed on the store promotion, terms, event or products being advertised. Cheat sheets with event details close to the phone are great reference tools and reminders for your staff.

Use thank you early and often. Thanking a customer for calling, thanking them for their business or thanking them for the opportunity to solve a problem goes a long way in a customer’s experience.
Don’t makes excuses to customers why someone is not available. A simple “He’s not available right now” is more professional than “He had to run home to let his dog out”.

Be sure to say you are sorry if the customer is having a problem, apologize and commit to finding a solution to the problem.

Create processes for getting messages to their intended recipients on a timely basis. A broken promise to receive a call back offsets any goodwill or positive marketing efforts. A multi-part phone log allowing notes to be handed out while maintaining a permanent record is one option.

Be mindful of keeping or forgetting calls on hold. Need I say more?

Teach your staff to introduce themselves, get the caller’s name and use it appropriately. Take a call back number just in case you are disconnected.

Of course the phone works both ways. Outgoing calls are powerful tools to help you maintain your customer base, grow your business and cement the customer’s relationship with your store. Consider the following for making outbound calls.

A personal call to thank customers for purchasing or simply visiting the store is powerful. Many stores focus on the power of thank-you cards, but a thank-you call is just as powerful. Remember to use and share names in the conversation.

A call to make sure everything went smoothly with the purchasing process may be viewed by some employees as opening a can of worms for problems. Seriously, don’t you want to know if there are problems that need to be addressed? Whether the process went smoothly or there is an issue, your customers will appreciate the effort.

Train your staff to pave the way with customers for future calls by asking permission to reach out in the future with special offers or events. Salespeople rarely enjoy cold calling and many customers do not appreciate being cold called. Think of this as permission-based marketing similar to having someone opt in to an email process.

Call customers with information before they call you. If their merchandise has arrived early or arriving later than expected, a phone call will be appreciated by your customers.

As a store owner or manager, open your ears to listen and really hear what is going on with phone calls. Coaching or praising an employee immediately after a phone call is powerful and lets them know you are listening. You may even consider a secret phone shopping service to measure how the store is doing with telephone calls. Call your store from time to time; you may be surprised by what you hear.

Marty GrosseFurniche.com founder Marty Grosse has 35 years of experience including senior positions across six top-tier retailers. Furniche provides visitors real, relevant and timely shopping advice with access to research, local furniture stores and manufacturer information. Contact him at martygrosse@furniche.com

Uncovering Opportunity

November 25, 2014 —

Whether you call it a sofa, couch, divan, davenport or settee, few can refute the satisfaction it brings to plop down and relax on a comfy surface at the end of a long day. RetailerNOW spoke with four upholstery manufacturers for this snapshot of the market—Reyna Moore, vice president of marketing and merchandising for Norwalk Furniture, Len Burke, vice president of marketing at Klaussner Furniture, Mark Gilmore, vice president of sales at CR Laine and La-Z-Boy’s Paula Hoyas, vice president of merchandising, Chuck Seilnacht, director of retail excellence and Mark Wagner, vice president of brand and retail marketing.

RetailerNOW: What’s been the biggest innovation in upholstery in the last five years?

Moore: Function and technology. Consumers want to maximize the use of their furniture. We’re not just talking about ottomans with built in storage but also about pieces traditionally reserved for use in one room showing up elsewhere. People are building master suites with sitting rooms furnished with elegant chairs and smaller sofas. Technology has been the biggest change in the industry. We need to embrace how we use technology to reach consumers. Norwalk has launched an app for our Kent group—retailers download the app in-store and consumers can “play” with the furniture, changing arms, seats, fabric. It’s a nice tool to discover the collection and it diffuses the nervousness people may have about buying furniture; it’s a great icebreaker.

Norwalk TribecaNorwalk makes furniture shopping fun and interactive with its mobile app developed exclusively for its Kent collection.

Burke: It’s important to keep up with technology so you can anticipate how that will translate to consumers’ furniture needs. For example, we used to have to keep in mind that users would need to sit right in front of the TV for maximum viewing pleasure—that’s not true today. To keep up with new technology, Klaussner sends staff to the Consumer Electronics Show. We need to know what’s happening in technology. We’re fighting for disposable income and competing with electronics, travel, auto, not just furniture. CES is a very exciting show and we try to bring that back to our showroom. We show 12-15 big screens (55”— 90” TVs) and the new 4K; we do it to show dealers what they’re competing with. We partner with one of the largest electronic distributors in the U.S. to make these TVs available. Dealers need to embrace technology—not run from it. We also have to keep up with components that are compatible with Apple products. Everyone is sitting there with iPads/iPhones; everyone is connected and everyone is looking to integrate those components into the furniture. Tech dictates the consumers’ lives.

Klaussner StudioKlaussner’s Studio theater seating (below) is the perfect mix of comfort and technology with its power recliners and lighted cup holders.

Hoyas: In motion the innovation is all about power, power, and more power. It’s finally here—I’ve been in the industry for many years and always felt it was coming. Powered motion offers comfort and adjustability literally at the touch of the button. The technology and design offer more angle options and the ability to independently recline the back or the foot rest. And the wallaways are perfect for smaller spaces.

Gilmore: Absolutely the changes in technology, from the way we communicate via social media to our dealer’s ability to access information through our web portal. We’re using iPads and at some point catalogs won’t be used as much (though not right now). Five years ago the social media platforms didn’t exist like they do today. Facebook has slowed and Instagram is huge. Houzz, Twitter, Pinterest—they allow us to reach out to consumers and inspire designers. They’re looking for ideas and using these tools. Our dealer portal on the website is filled with information and available 24/7 so they can look up orders, fabrics, access the digital library—our customers don’t have to wait to get their questions answered. Then there’s the technology in manufacturing itself—we’ve made several capital expenditures in our cutting equipment and manufacturing that’s helped us with capacity in that last few years.

RetailerNOW: There are so many colors and patterns in upholstery at market, but on the retail floor there are a lot of blues/browns and neutrals. What is the consumer really after and are we giving them what they want?

Moore: Consumers want their furniture to have longevity; they add more color with accent chairs and pillows not necessarily the big pieces. When we look at our patterns we don’t judge the performance of a fabric by the yard, but where it’s placed. Consumers are trying to be more on trend and with us having more custom options they’re able to do that.

Burke: As domestic business comes back to the U.S. you’ll see more retailers using color. Before, if you ordered a container of red sofas for example, and it didn’t sell you were stuck with lots of red sofas. We offer 600 fabrics but 40 percent of our business is special order. We give retailers choices; our business has come back and retailers are looking for a domestic supplier. This is a fashion industry and everything derives from apparel and paint; we’re seeing retailers taking a bit more risks now.

Hoyas: We’ve been enamored with color; consumers love it and tell us that and then when they have all of the options in front of them they pay homage to the neutrals. But the colors can come in accessories and accent pieces so their investment is safe for a number of years with the base colors. Retailers are pulling in more color on their sales floor. With patterns we see a lot of the smaller scale patterns, geometrics, abstracts, floral abstracts. We’re also seeing more traditional transitional looks—consumers want a traditional foundation but not grandma’s traditional. Think textural menswear looks, leather, tweed and natural fibers—the foundation is tradition, but updated it’s actually what you’re seeing in fashion with boyfriend cuts and oversized menswear cuts in women’s wear. Furniture always follows fashion, but with everything out there on TV and the Internet, we’re closing the gap and people don’t have to go off to study these designs or styles—everything is instantaneously available.

CR Laine JEREMY SOFACR Laine provides dealers with tools and resources to help them recreate the vignettes that draw consumers attention.

Gilmore: Market is the fashion runway; everything we do will get somewhat boiled down to the end consumer and the end consumer plays it far safer. Consumers want design help; they say ‘I’ll know it when I see it.’ We try to help dealers see the possibilities or ideas and then replicate them in their showrooms. We give them paint colors, and design ideas and information on the vendors we use for our lighting, rugs, accessories, etc. We’re trying to inspire the dealer to do this so the customer will just walk in and love it—and buy it. The reality is it doesn’t always happen that way. The way we merchandise our showroom takes a significant financial commitment; but retailers can take pieces of it and make it their own. We put quite a bit of time and effort twice a year into designing and merchandising our showrooms, but retailers are doing it every day and that’s hard work. Their sales floors are always changing. When dealers sell stuff it’s great, but it adds to your work. It takes a significant amount of effort to be done right.

RetailerNOW: How do the ever-changing regulations (such as in flame retardants) impact your business? Do your retail partners seem concerned about this issue?

Moore: In areas of the country where people are a little more exposed to the information, we get more questions. Moms are concerned about safety in the home—those customers are asking for it. Norwalk is more of any early adopter of these types of things; we want to take a position of leadership.

Burke: The retailers are asking questions. There’s been a lot of press about it; is it harmful? Is it not harmful? For us it hasn’t been an issue because we pour our own foam, we aren’t dependent on a third-party supplier and we can react quickly to whatever needs to be done. We’ve been able to adjust to that.

Gilmore: The issue is the regulations are an ever-moving target for manufacturers and what [legislators] don’t realize is the number of steps in the manufacturing process. It’s not as simple as slapping a label on something. The reality of the flame retardant issue is very few dealers ask the questions. Quite some time ago we took the (flame retardants) out. There are a few who are socially minded who are asking.

RetailerNOW: What type of product information or training do you offer your retail partners?

Moore: We have a corporate trainer and we have training here at the factory. We just hosted a two-day training class and we had everyone from a new designer to someone who’s been selling for 15 years. After market we bring product back to the factory and merchandise our showroom here because we use it as a training ground. We do product training and sales techniques. Right now we have monthly classes, 35 people per class, and retailers are asking for regional training. Coming here is a huge success because they can see the factory and see how product is made. We follow their sales afterwards and we see huge spikes.

Burke: We launched Klaussner University in April, an online training course for sales associations. There are modules on Klaussner product knowledge, upholstery, casegoods, motion, sleepers, and leather. It’s interactive and allows them to work at their own pace. There’s backend reporting for managers, printable worksheets and testing and certification. Training is important and our reps do a good job but this new program provides instant training.

Seilnacht: La-Z-Boy offers all of our retailers a comprehensive online training curriculum. Our product knowledge courses cover upholstered products, new introductions, and mattresses. Our selling techniques courses include a seven-module series and other selling skills courses are focused on presenting finance options, selling casegoods, and more. We also have a suite of more than 20 management training courses that has both basic management skills training and courses specific to retail management.

Gilmore: The web portal is helpful, but our reps are consistently out in front of the dealers—training is important. Retail stores have turnover so you are constantly training; we have product-knowledge meetings multiple times a year. For the last three years we’ve offered intensive two-day training sessions here at CR Laine. The training is on things they should know about selling leather furniture or patterns on curved backed chairs, not specific to our product—we keep the numbers low—small groups (20 people). When they walk out of here they feel confident. More knowledge brings confidence, confidence brings trust and trust brings sales. If you can achieve those things…if you show that confidence to the consumer they will believe you and they will buy, it’s not complicated.

RetailerNOW: How are you effectively marketing to Millennials and/or how are you helping your retail partners do the same?

Moore: We’re marketing to them through social media and we’re reaching out to younger retailers to see how to go after that group. Our Urban Studio collection was designed for the younger customers as well as small space living (baby boomers downsizing). It’s for the young executive who invests in quality product and they tend to be more contemporary; they’re also more comfortable with colors and the color palette in that collection is strong. This members of this demographic group are curators of their own home and we recognize that.

Burke: We’re obviously designing product for them. We’re trying to stay informed on social media and we’re keeping our retailers tuned in. Photography changes every day, videos are important and we supply the marketing assets and ideas to the retailers; our brand is the dealer’s brand; we have to help them come up with ideas.

Wagner: Our products are designed to appeal to consumers who are interested in creating a comfortable and inviting home, and are seeking high-quality furniture at a great value.

We market to more of a mindset, rather than a specific age demographic. We offer consumers a full line of products in a wide range of customized styles for the living room and family room. We support retail partners with comprehensive marketing programs, including national media campaigns, in-store promotions, public relations and social media efforts.

Gilmore: Our focus is how to meet consumer needs not just one demographic. We build a product with the consumer in mind—does it have the right sit, pitch, comfort, styling, color. There are people in their 20-50s driving Mercedes; Mercedes doesn’t go after a certain demographic.

Uncovering Opportunity

Here’s something that might come as a surprise to you: The majority of upholstery sold in the United States is made in the United States.

“These are not jobs that have returned home, these are jobs that never left,” said Pat Bowling, vice president of communications for the American Home Furnishings Alliance (AHFA).

Interestingly enough, these upholstery factories are having a hard time finding workers. AHFA’s Solutions Partners division is trying to help uncover the reasons why these jobs have been difficult to fill and possibly develop a campaign to help recruit new workers.

Part of the problem may be training. Lower end upholstery factories used to be a training ground for factories that specialize in higher end, more custom products. But as production of lower priced products moved overseas, U.S. factories lost their pipeline of trained workers.

Another problem might be the misconception that all the furniture jobs are going overseas. “If you think about it, all the media attention focused on plant closings over the last decade has most people thinking ‘no one makes furniture in the U.S. anymore’,” Bowling said.

Mark Gilmore, vice president of sales, CR Laine said “It takes a trained person to do eight-way hand tied and it’s not as simple to get those people. There aren’t as many people out there doing that.”

Gilmore and others in the upholstery industry are encouraged however. Catawba Valley Community College, Hickory, N.C. now offers a two-year course in upholstery manufacturing and it’s first class (soon to be graduates) was full.

The Roller Coaster of Sales

November 25, 2014 —

Of all the important things you do in a furniture store, planning and holding effective sales meetings may be the most important. Anyone who has ever managed a store knows the work never ends. There’s merchandising, operations and marketing that need to be taken care of, but let’s face it: nothing else ever happens (or matters) until a sale is made. It is easy to overlook the importance of a good sales meeting and the impact it can have on your selling success.

When salespeople are selling and everyone is buying, there’s no feeling like it. And when salespeople are selling and nobody’s buying, well, there’s no feeling quite like that either. Selling is an emotional roller coaster. That’s why your sales crew needs meetings that help them grow, improve and stay focused.

Think about how you plan sales meetings. What does a good one look like? What do you include in your meetings? Where do you divine your creative inspiration? How do you deal with all the different sales people and their personalities? And if selling is a roller coaster, where is your seat?

Here are a few tips for improving the impact and effectiveness of your weekly sales meetings.

Create a sales meeting calendar

This should be done after establishing your advertising and marketing calendar for the month or quarter. Good sales meetings will maximize advertising expenditures. Advertising plans also provide a framework for sales meetings. When does the promotion run? What is the featured merchandise? Is there a finance offer or other specials with the promotion? All of this is important to review with your staff. Have you ever had a salesperson ask “Are we running any merchandise or other specials right now?” Not exactly reassuring, and a bit cringeworthy.

Create a meeting template

Think of your meetings as a hamburger. The top bun is the basic information of the promotion including time frame, types of advertising, merchandise specials, financing or any information that the sales team should know. The meat of the meeting should be something that enhances or reinforces one of the tenets of selling such as the greeting, probing/qualifying, presentation, overcoming objections, closing or following up after the sale. The meat you choose may be guided by one of the key elements of your event. Maybe it is spending time in the bedding department working on “qualifying” the mattress customer during your gigantic “Pedic” event. The bottom bun of the burger is preparing the team mentally for the game of selling. We all have outside distractions in our lives (relationships, pets, mortgages, children, vacations, etc.) it’s important to help salespeople focus on the day at hand and the customers. Use the bottom bun, or end of your meeting, to reinforce any sales contests and goals.

Stay focused

Do not use sales meetings as a venue to review operational or team dynamics issues. These items need to be addressed but not here. I once attended a sales meeting where the manager reviewed a litany of problems and finished the meeting with an enthusiastic “Now let’s go out and have a big day!” Really?

Spice it up

Remember, selling is fun! Find creative ways to spice up your sales meetings and fight the “same old same old” syndrome. Think about occasionally changing the meeting location. I once held a sales meeting outside in front of the store. You can hold one in the back of a delivery truck complete with chairs and a movie screen. Engage your staff by involving them in the meeting in some way. Think about a skit, a scavenger hunt, game or simply researching a new product on the floor to share the features/benefits with the other sales people. There is always the old standby of having a factory rep come in and do part of the meeting. Make sure you trust the rep to keep it positive and upbeat.

Find a story

Everyone has a story. Find selling stories in everyday life that parallel the selling process on your floor. I once held a sales meeting named “The Selling Secrets Only Your Hairdresser Knows.” The meeting was held with the sales team behind me looking into the mirror complete with a customer in the chair in front. Think about it: Hairdressers have to ask careful questions of their clients to determine their needs. Hairdressers are always looking in the mirror at themselves knowing that the customer is evaluating their looks and evaluating their professionalism. Hairdressers must have all their tools within reach to do their job and, of course, they rely upon repeat business and word of mouth from happy customers. Sounds like selling furniture doesn’t it? Train yourself to look for selling situations everywhere you go. There is nothing like a story (good or bad) to reinforce selling skills. Another benefit of this could be you end up recruiting that employee at the dry cleaners to be part of your sales force.

Be open to critique

At the start of the next sales meeting ask for a rating of 1 – 10 on the previous meeting. By conveying a servant mentality to your team in helping them improve and perform at higher levels, you may be surprised at the feedback you receive. Let them know you want to improve to help them get better, make more sales and ultimately make more money.

Use technology

Videos and movie clips can help make your point. Blogs devoted to selling can also help. There is even a Pinterest board out there for sales motivation ideas.

Get everyone involved

Invite your non-selling staff to the meetings from time to time. It never hurts for them to gain a better understanding of the selling process. They may ask some enlightening questions that benefit everyone.

Have fun

Take your work seriously but do not take yourself too seriously. Sure you’re the boss and, yes, you are important and of course everyone should cling to all those nuggets of wisdom you utter and … Come on this is the furniture business! Have some fun. Be sure to celebrate individual and group successes in your meeting. Most importantly keep every sales meeting positive!

Effective salespeople and teams require positive, upbeat and regular sales meetings if you want them to get back on that roller coaster and ride it over and over again. Now get in the front car, buckle up, throw your arms over your head and scream with delight when your crew achieves sales goals. There is nothing like a roller coaster to get your blood pumping. And don’t worry, your sales people will be right behind you.

Furniche.com founder Marty Grosse has 35 years of experience including senior positions across six top-tier retailers. Furniche provides visitors real, relevant and timely shopping advice with access to research, local furniture stores and manufacturer information. Contact him at martygrosse@furniche.com

Calling it Quits

November 25, 2014 —

The subtitle of a Van Morrison album is, ‘No Plan B’. The album comes to mind as I wander the aisles of a retail show and see so many vendors offering their services to help you close your business. Just before writing this column, I received an email from a couple who had been in business for 35 years and were looking at closing their doors.

Their business had been on the market for three years without producing a sale. They were asking if it was time to consider Plan B—closing the store. This is not the first time this scenario had been discussed, but to this writer, Plan B is not a good alternative.

While they mentioned visiting with their attorney and accountant, it appears the conversation is a few years too late. When you want to sell a business, these discussions need to be held about five years before you want out.

There is a different strategy to operating a business through the last few years and the preceding years of the retail life cycle. When you are operating your business, as the owner you have an advantage that most people do not get.

Most people get a W-2 at the end of the year and there are a minimum number of tax and medical deductions they can take. The owner of a business can do a lot more. From having the business provide you with a car to giving your children a salary instead of an allowance, there are many opportunities for the small business owner to place a lot of expenses within the operation of the store.

Of course, this makes the store earn less, but there’s something neat about paying your children to take out the trash at the store and being able to pay them money as a legitimate business expense instead of giving an allowance which is not tax deductible. You are not as concerned with the bottom line of the business when you are getting these perks.

However, when someone wants to buy your store, in addition to looking at the store they will want to look at as many as five years of financials. This is the same five-year time frame we were just mentioning.

When the buyer is going to offer a contract, they are going to pay for the inventory at landed cost, a fair valuation of the fixtures, equipment and the build out of the store, and the best part—‘good will’ or ‘blue sky’ money which is calculated as a multiplier of the average of your net profit for the last three to five years.

Stop and do the math for your store right now. Look at the net profit for the past five years and add those numbers together. Divide by five to get the average, and then we will assume your buyer is going to offer you 2.4 times that average amount. Nice pile of money?

That explains why for the last five years you own the store, you want to get all of these ‘marginal expenses’ out of the business. Look at all of that other money we talked about in inventory, fixtures and other items. If you choose Plan B and close the store, you are getting none of the blue sky or good will, pennies on the dollar for the fixtures, equipment, and build-out. Also, your now-empty building is not only worth less, but your insurance is going to be more expensive for an empty building.

I bet the couple who contacted me would think differently about closing their store if they knew how much money they could get by selling.

I have many questions for my prospective selling couple.

How many different brokers have you utilized in these past three years? Were those brokers specialists in small business? Where have they been advertising the business? Have you had someone give you a qualified business evaluation so that you know you are asking the right price? Have you considered keeping the building, but selling the business?

There are a lot of questions to be asked when you are thinking about selling the business. Those questions need to be asked—and answered—well before the day you want out. And knowing now what you can get from selling a profitable business, there should be no Plan B.

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.

Sales to Plan. Do You Have One?

November 25, 2014 —

A few years ago, I attended a sales leadership conference of a multi-billion dollar corporation in Hawaii. I sat with the top 20 percent of a sales force that numbered in the thousands. It was like a rock-n-roll show with two massive screens on either side of the stage in the auditorium.

The vice president came on the stage. Before speaking, he presented two slides: The first slide was plain and simple: “Sales to Plan.” The second slide was even simpler: “104%.” Music erupted and a standing ovation ensued.

There are many Key Performance Indicators to measure a company’s success. Sales to Plan was the most important performance indicator that this company’s team was concerned with. Most other numbers in the company relied on the sales team achieving this metric. Profitability, operating spend, inventory, number of employees and liquidity levels—all required sales to achieve their plan. Your home furnishings store is no different. It is interesting, though, that many other smaller businesses don’t always share the same focus on setting and achieving an actionable plan as this top corporation.

Achieving your desired sales volume is critical to growing your profits and cash flow. If you fall short of your sales target, your fixed expenses will eat into your profits and make payables difficult. This is fairly obvious, but the truth is that many small home furnishings stores don’t have a good handle on what their targets should be and how to achieve them. Some retailers even ignore company-wide sales goals altogether choosing instead to focus only on the goals of individuals. Best-practice businesses, on the other hand, set achievable sales volume targets. They ensure they have sales and marketing teams in place that can match or exceed their targets.

Actual sales are easy enough to determine. The tricky part is setting the target. Should you just pick a number, say 10 percent, and add it to the previous year? Should you keep the number flat? Should you ask your salespeople what they think they can achieve? Or, should you figure out what sales you need to produce a certain profit?

Whatever you decide it is a prediction. Your sales target will rarely be perfect. No one can see the future and everything that will occur in a market while factoring regional and national economies. However, setting this target is the best way to send a message to your team of the direction of your business. Without this goal, your chances of getting there and surpassing it become much less likely.

There are six steps to setting sales to plan:

  1. Determine your annual sales plan on written business. You can use a percentage-increase-over-last-year method or a profit-up method. With a profit-up method, you start with your bottom-line net income and factor all fixed and variable expenses to determine a required sales volume. A third way is to use this formula: Planned Sales = Planned Number of Customer Visits x Planned Average Sale x Planned Close Rate. Just make it realistic.
  2. Break down your sales target into four quarters and 12 months. Review your three prior years to determine if there is any significant seasonality. You cannot just take annual goals and divide by 12 as different months have a different number of weekend days.
  3. Break down your sales target into 52 weeks, seven-day weeks. (Monday-Sunday). This accounts for full weekends and allows you to set an average weekly volume target.
  4. Review the company goals with your sales team.
  5. Help your salespeople set achievable targets. Individuals are just that—individuals. Some are proven top writers, some are average. Do not set everyone with the same sales goal. This is less motivating to the top people and unrealistic to others.
  6. Define your strategy. What do you need to do to make your numbers? This will involve defining specific operational tactics. For example, if you determine that planned customer visits and close rates are going to remain constant, average sale size must increase to produce a higher volume. This may be done through focusing on add-ons, group pricing and merchandising tactics.

So how do you use Sales to Plan as a Key Performance Indicator to grow your business?

It’s easy, really. At the end of each week, report the results for each salesperson and for the entire operation. Weekly Actual Sales/Weekly Planned Sales. This is your weekly report card. On a weekly basis, report the month-to-date numbers with respect to the target. If you are above 100 percent, you are on target. Once the month is over, nothing can be done. The purpose of weekly tracking is to check your progress while you can still do something about it.

Remember to spend some time after the month has concluded to analyze why you exceeded your planned volume or why you missed. Make tactical adjustments to correct when necessary. Here are some areas to dig into when determining how you ended up where you are:

  • Break down sales into its parts: Total number of customer visits, average sale, and close rate.
  • Look at sales produced by each one of your sales reps.
  • Review sales by inventory, vendor and category.
  • Review return on promotional activities.

Your sales plan needs to be assessed every quarter—not just for the prior three months, but also year-to-date. You want to be over 100 percent here. If you’re off target by more than 5 percent, you should re-examine your strategy. Are your goals unrealistic or too low? If you find that hitting your numbers is not possible, you may need to reduce other expenses to maintain proper profit levels. If you find that you are well ahead of your target level, it may be time to up the bar. That’s a good thing!

Your annual review is a time to reflect on the past. Use what you learn from that review to set a new strategy for the following year. Build on your successes and, just as important, learn from your failures. Go through the entire process of setting a new planned level of sales.

The first step to improving something is to track it. The absence of a plan is either a plan to fail or a just dream. The KPI Sales to Plan allows your organization to be forward looking and gives you a performance report on arguably the most important number in your business: Your Sales Revenue.

David McMahon is an industry business consultant and certified management accountant. He is director of consulting and performance groups for PROFITsystems, a HighJump Product. He can be reached for questions or comments at david.mcmahon@accellos.com.

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.