“The confidence that individuals have in
their beliefs depends mostly on the
quality of the story they can tell
about what they see,
even if they see little.”
- Daniel Kahneman
Got a gut feeling
Got a gut feeling
Got a gut feeling feeling
Today’s Venture Capital companies are constantly looking for new style trends and products to improve their portfolios and improve their market shares. These businesses are managed by savvy entrepreneurs who are constantly harvesting the latest data and then adding market knowledge to help them create and implement their best strategy. Sounds like a good strategy, right? Is this how your business works?
In our DPH world, each vendor and showroom has its own unique ways of market testing and the most popular process is each business’s perceived reality, your intuition or gut feelings. You know it well; over a short period of time, a few showroom sales people sell a job or two in a matte black finish. Then they frantically search for what manufacturers offer this finish and run to management proclaiming “We absolutely have to have this on the sales floor NOW! This is getting really big! We all think rose gold will be the next oil rubbed bronze… “ Well, we all know where that went. Did anyone look at the showroom sales history and your product quote report? How about calling a handful of manufacturers and simply asking them for a “most popular finish report”, noting the current percentages and a 3 to 6-month percent change? Would that help? Why in the DPH world is DATA not the foundation for market evaluation and forecasting?
I can hear the words ringing in my head – “I know what is going on in my business and my gut instincts have gotten me to where I am.” This is the way so many DPH showrooms and manufacturers have governed their business since the 60’s, and yes, a lot of those businesses are still quite successful. However, would you invest in a business with intuition as its sole source provider of market research?
Perceived reality plays a large part in all of our lives, but it should be based on solid data from your business, one’s key vendor partners and monitoring leading style media. Yes, it will take time to dig through your sales figures and quotes, as well as sharing vendor information and referencing 10 good style sources. But at the end of the day, don’t you want to have the right product on display at the right time? Don’t you want your customers to know your showroom is the place to see the popular, new and classic looks?
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Also published on the Decorative Plumbing & Hardware Association’s blog: How Do You Forecast?