How To Use Your 2020 Data To Better Understand, Support and Delight Your Customers

In the last post we discussed building the ultimate data collection process for multi brand stores to place your business in the best possible position to grow. The more you can learn about your business, your customers and your targeted market, the better prepared you will be for the newly emerging algorithms, artificial intelligence support and insight.

For now, let’s look at the data you do have. Let’s set it up to answer questions that will allow us to better understand what is happening in our business and what we can do better to improve and gain market share.

Start with asking your ERP system to create the following spreadsheet for up to the last five years. It will be a big file, but full of data to help you and your team better understand what is actually happening in business.  

I suggest the following 11 headers for each line item invoiced:

  • Invoice Date
  • Customer 
  • Qty shipped
  • Vendor
  • Vendor Product Number
  • Description
  • Finish (if you can)
  • Margin (if you can’t pull this information directly, you can create a simple formula with information below)
  • Total line cost
  • Total line sale
  • Showroom salesperson

Please note here, only ask for the data if you are confident that the data in each of the cells is correct. If you had any past data integrity problems or consistent mis-entry issues, do not include those topics or time periods in your spreadsheet. As the saying goes; Garbage in, garbage out.

Once you have this data, make sure each cell in a column is formatted uniformly. If they are not, the data will be off when combined for a table or report.

Find your best and brightest spreadsheet expert and ask them to set up a pivot table and pivot chart with this data. If you cannot find such a person, ask your accountant, myself or YouTube. Click here for a simple overview of pivot tables to get you started.

From this data you will be able to ask the following questions:

  • What am I actually selling by: 
    • Vendor
    • Finish
    • Product category
  • Are my customers:
    • Purchasing everything they need from me?
    • At what margin?
    • What product categories that I sell that they are not buying from me? 
  • What are my salespeople selling:
    • By brand
    • By function
    • By finish
    • What are they not selling?
  • What are my margins by:
    • Brand
    • Customer
    • Vendor
    • Salesperson
    • Product category

Notice that I have included questions related to product categories even though that is not one of the spreadsheet headers. We do not have exact information here, but we know that most brands are primarily focused on one product category. It is not a perfect metric, but it will offer you added insight into what your customers are buying/not buying. This filter will help you identify which product categories and vendors are reaching your margin goals, opportunities to sell more product categories to your good accounts, and if your salespeople are remembering to sell all the products you offer.

Once you have these answers, along with answers to questions you deem important to your business, you can focus on the opportunities you see that offer the largest upside and are the easiest to address. 

After you set this up, you can run the data output and create your pivot table reports at the end of each month. You will now have actual, black and white data to allow you and your team see what is actually going on and plot a course to improve sales, margins and team performance. Not to mention getting the right products on display and building a more dynamic inventory.

Aversion of this post appeared in the February 14, 2020 issue of Connections, the Decorative Plumbing & Hardware weekly newsletter.

Value = Experience / Price

We are in the midst of the largest retail shakeup in history.  To put the DPH showroom performance in perspective, Coresight Research notes in its November 15 update, “US retailers have announced 9,052 store closures and 3,956 store openings.”  Having just returned from the annual DPHA conference, I can tell you that the overall feeling is that business is good and will remain that way for the next 18 months.  While this is not a statistic, deeply researched or confirmed, it has been a good indicator for years. I would like to congratulate all DPH showrooms for continuing to run ahead of the brick and mortar pack.  Let’s make sure we stay ahead.

Think back to the time before the term “customer experience” was used to evaluate everything from Jiffy Lube to Hermes.  As the industry began to pull itself out of the muck of the recession, the term “product value” was all the rage. Its catch phrase was: “Is that a good value for my money?”  Customers were looking for value – the best products for their dollars, not low price. 

As the industry became skilled on the “value” sales conversation, that term slipped into the background and “customer experience” emerged as the overall, undefinable, defining metric.  Repeatedly we read and have been told that, “All great businesses offer a top-notch customer experience.” We see it referred to in case study after case study but, as with “value,” the challenge is to define and measure great customer experiences.

Angel investor Darren Herman offers guidance in his blog, Operating Partner.  He proposed the following simple formula:

Value = Experience / Price

On first thought, that formula appears to be too simple, when you evaluate the equation in more detail, it makes sense.  The kicker is defining experience. Price is simple: the lower it goes, the lower the experience factor can be to still deliver attractive value. But, if you are playing on the luxury-premium level, you have to improve the experience to justify higher pricing. 

It has been proven continuously that the lowering price value strategy is a never-ending race to the bottom and that’s not a successful formula for DPH luxury experiences.  The decorative plumbing and hardware industry can deliver on its value paradigm by focusing on the following five touchpoints: Showroom, Website, Salespeople, Customer Service and Vendors. 

Breaking them down into easily defined deliverables allows you to create a manageable list to use as a brand experience evaluation scorecard (equally applicable to Manufacturers, Representatives and Showrooms).

  • Website
    • Is your website easy to use and comfortable for your customers to shop?
    • Does your website offer the information your customers require?
    • Is your website easy for Google to find?
    • Are your key vendors’ presentations and product pages up to date?
    • Is your website respected more than your competition’s?
    • For e-commerce sites, does your showroom’s in-stock inventory cater to the products your customers really need before the vendor can deliver? 

Side Note: Today’s customer wants to do their work whenever and wherever they are.  To have a poor website is interpreted as you are not interested in their business.  An effective and easy-to-use website is a must have.

  • Salespeople
    • Are your salespeople more knowledgeable and respected than your competition?
    • Are they consistent from customer to customer?
    • Do they listen actively?
    • Do they want to improve?

Side Note: Every time I am at a showroom or attending a conference the number one problem our colleagues mention is finding good people.  Yet, few companies offer any type of sales training to make their good people better. I have never met a salesperson that cannot get better and that includes me.

  • Customer Service
    • Do you offer uncompromising cradle-to-grave service?
    • Do you proactively communicate both good and bad information with your clients as their job progresses?
    • Do you reach out to the client and end users after the job is finished?
    • Is your product return process painful for the client? Are they presumed guilty before being proven innocent?

Side Note: A significant factor in the continuing growth of showrooms and vendors is based on selling more to good customers.  Will that hold true if you continue to offer the least?

  • Vendors
    • Are they what they say they are?
    • Do they train and keep your purchasing, sales and customer service teams up to date?
    • Do they design and craft products in line with their pricing?
    • Do they deliver on what they promise?
    • Are their demands in line with their value to your business?

Side Note:  Vendors, when was the last time you surveyed the key 100 showroom salespeople about what they think will help your brand improve?  When was the last time you and your distributor showroom surveyed their good builder and trade customers about what they think will help your brand improve? Sitting in your office listening to a few loud folks is not the best way to build your brand’s foundation.

  • Showroom
    • Is your showroom easy and comfortable for your customers to shop?
    • Is your showroom easy to use by your salespeople?
    • Is your showroom perceived as stylish by your core design trade customers?
    • Are your key vendors’ displays up to date?
    • Does your showroom’s inventory contain the products your customers need before the vendor can deliver?

Side Note: Maintaining a showroom is hard work and expensive, but when done effectively is can be very profitable.  The more vendors, representatives and distributor showrooms stay in step, the better for all parties involved.

This list provides a tool to evaluate your business and to determine your customer experience rating.  Each point can be valued good or bad or with a five-point scale. Determine which metric works best for your business and team.

There is one other factor to consider.  Each point on the list focuses on eliminating FRICTION your customers encounter when working with your company.  Both trade customers and end-users HATE friction. Removing friction requires an investment of money and time. Willingly taking back a polished nickel lavatory faucet that looks as if it was attacked by a steel grill brush is not easy or cheap, but necessary.  

Do not lose sight of the fact that you are working to increase your customers’ perceived value of your business.

The bottom line is that each individual customer will evaluate your business.  Having a metric to determine how your business is perceived will improve your customers’ experiences and help you develop effective strategies to address weaknesses.

A version of this article appeared in the January issue of Kitchen & Bath Design News

Vendors, May We Please Improve Training

The quality of training in the showroom business is all over the place. Training is not like selling; they are two distinct talents.  A few companies create solid content but have not trained their trainers on how to train (say that fast three times). Other vendors weakly educate the local representative and tell them to go forth and educate all involved. They send them in with catalogs and some samples.  Really, is that how a brand should be presented?

Here are some notes:

  • No one looks forward to product knowledge training sessions.  Showroom salespeople are extremely busy and do not want to give up the time during the day.  Also, no one wants to come in early or stay late.  
  • Abide by the Venture Capital pitch 30/30 rule.  No font should be smaller than 30 pts. and no presentation should be longer than 30 minutes.  In a perfect environment our minds can only stay focused for a maximum of 20 minutes. So build a solid 20 minute presentation and leave time for questions. Do not overreach, you will not gain a thing.  In fact, you will lose what you gained in the first 20 minutes.
  • Do not train on a product that is not yet on display or ready to ship.  The salespeople will forget all the information by the time you are ready to receive orders, even if it is just a week away.
  • Beta-test your training content in the field.  Present your new training program to a few local showrooms, then note and implement the feedback.  
  • Train your own customer service team first.  Present the training draft to them first and gain their feedback.  Then, when a showroom salesperson calls with a question that references the training, everyone is on the same page.
  • Do not hand out any reading material during the presentation. You want the trainees to look at the presenter, not at a price book.
  • Recap, ask questions and offer rewards during the 20 minute training.  Questions keep them engaged and rewards help all stay attentive throughout.
  • Do share actual product samples…LOTS of samples.  It is proven that if people have product in their hands they will remain engaged.
  • If offering food, save it for AFTER the training.  If they have food during the session, they will focus on that.

Finally, if you really want to do it right, hire a 100%, full-time trainer.  As we noted above, your talented sales people and representatives are not always adequate trainers.  Do you really want to get into an automobile with new brakes that were installed by a mechanic that was trained by the brake manufacturer’s local salesperson?  Then why do you ask talented salespeople to educate the salespeople that sell your brand’s story to design and building professionals?  

If your training content and presentation are solid, you’ll always get the best product knowledge training time slot and the showrooms salespeople will gladly attend ready to learn.

A version of this article appeared in the February Issue of Supply House Times

It's Holiday Time, Yipee!

Image by mohamed Hassan from Pixabay
I hope everybody had a lovely Thanksgiving.  A wonderful holiday allowing American families to pause for one day to celebrate the passing year’s blessings. Then consume mass quantities of delicious food.   

As Thanksgiving fades into memory, Christmas Day is on its way.  The massive barrage of advertisements for Black Friday, Small Business Saturday, Cyber Monday, Giving Tuesday have passed and they have been replaced by a consistent torrent of emails, ads and banners telling me that I can only have XX% off if I buy now!  It is all so annoying. 

Outside of that noise, I do enjoy holiday shopping.  I love to discover just the right gift for my family and friends.  Each gift I select has deep logic behind it, and I know it is something they never would purchase for themselves and will treasure for years.  I hope to watch them peel back the shiny paper and see a bit of delight on their faces when they discover what it is.  I love that look!  Then sometimes they unwrap the gift and look at me, what the….?  Off to the return counter.

The important thing is that my time searching, not dealing or discounting, is time that I spend thinking about the wonderful people in my life and in small, very small, way give them a bit of Holiday joy.  
 
Happy Holidays!  
 
Ohh, P.S.  As the 2019 Holidays pass, all will turn to talking about 2020.  Before that happens, find a moment and congratulate yourself, yes you, for all the hard work you did in 2019.  Every once in a while, it is good to look in the mirror and say, great job, well done!  Cheers
A version of this article appeared in the December 20, 2019 issue of DPHA Connections.

Tinder In My Showroom?

“I like that but could I see it in this tone of yellow?”  How often have you heard this on your showroom floor?  

This is a question that has been haunting showroom salespeople for decades and, I think, we just might have the answer.  At the 2019 Lightovation show at the Dallas Market Center, a leading luxury lighting manufacturer had strategically placed 4’ x 3’ interactive touch screens amongst its spectacular products.  The screens were programed so the user could simply swipe right to easily move from image to image.  Even amongst hundreds of beautiful lighting fixtures, these screens, with their larger-than-life images, were the draw.  An EXPERIENCE garnered more interest than the actual product.  People would stand and swipe to their heart’s content as the images were quickly delivered from its huge database.  Yes, it was a large screen that was the star of a show attended by the purchasing agents from the top lighting showrooms in the United States and Canada.  Not a specific fixture, product series or brand, but a SCREEN.  Are we focused on our screens or what?

Brick and mortar showrooms are not going away, but if a physical luxury showroom does not incorporate a 21st century experience, that will hurt its image.  Imagine a customer walking into your showroom and heading straight for the interactive screen.  In a matter of minutes, they are flipping through your products as fast as they can swipe.  Customers travel to your showroom to interact with the actual product and still want to be able to see everything imaginable.  They want to experience the best of both the physical and digital worlds in your showroom.

When a customer asks what this faucet looks like in another finish, no problem.  You can show it to them on your 4’ x 3’ screen.  You cannot physically show it all, but you can show a large image of your customer’s dream look by simply accessing your mighty, mighty database. 

The answer is to bring the internet power into your showroom.  Slap a screen on the wall and voila, millions of product images are alive!   Unfortunately, it is not simply plug and play.  It will take some programming, and access to properly configured vendor databases to make this dream a reality.   

When I returned home, I did a little digging and discovered these two “Kiosk” companies.  It seems kiosk is the preferred terminology in the self-serve retail world, as opposed to large touch screens.

Also note, these company’s understand that your screen needs are different from McDonalds and they have programers ready to deliver what will surprise and delight your customers.

I believe kiosks (screens) will be a big showroom draw and expand showroom offerings to infinity and beyond…

A version of this article appeared in the December 13, 2019 issue of DPHA’s Connections

What Happened at the 2019 DPHA Conference in Seattle

As always, the 2019 DPHA conference was abuzz every day from 7 in the morning until well after midnight.  It has been another good year for our industry, and most are enthusiastic about their individual futures and excited about the expanding opportunities in the decorative plumbing and hardware market.   The days were punctuated by captivating product booths and many varied discussion topics.  Below are the more popular trends and topics that were consistent threads in my many conversations:

  • Business remains strong with some secondary markets anticipating a small slowdown in early 2020.
  • New products introduced were mostly simple upgrades and product line tweaks with only a few truly new products presented.
  • People are interested to see if industry consolidation will continue and how it will affect the DPH showroom world.
  • The industry needs to remain focused on luxury versus premium. 
  • Where do the fascinating new technologies fit into our hand-crafted product business?

The education sessions were anchored by talented, insightful people.  Here are my key  takeaways:  

David Avrin enlightened us by helping us to:

  • Locate customers we did not know existed
  • Continually work to surprise and delight our customers
  • Remove FRICTION at all points of customer interaction
  • Allow your team members to make what they think is the best decision versus “doing what the book dictates”
  • Learn why your customers want to buy
  • Remember trust is the root of a good relationship

Jay Acunzo open our eyes to:

  • Never stop looking for the next big thing
  • Never wait for what was the next big thing to die before moving on
  • Never stop improving your business’ unique draw
  • Never stop evaluating your process and structure
  • Understand what the anchors of your business are
  • Build on and refine what is working
  • Meet your customer where they are
  • Make your business’ culture embrace change and creativity

Designer Panel: Overcoming Confirmation Bias, What The Trades Really Want 

  • Do not get rid of printed catalogs
  • As a group, they do not want to buy plumbing on the Internet
  • They need more door hardware training to improve their confidence with product applications
  • Trades cannot always get to the showroom to work with a client, and might send in client alone with STRICT instructions on what to show them
  • They need CAD files now and will soon need BIM (building information modeling) product files
  • A lot of clients are not adventurous and want their entire bathroom designed from one brand’s product series with no deviations
  • New product updates are important, so please ask how each designer would like updates delivered (email, text, etc.)
  • CEU’s are important but not mid-day
  • Designers need finish samples to complete client design presentations – why are they so very hard to get?

The DPHA conference allows the talented people in the DPH world the opportunity to focus on bettering their businesses. Other gatherings are focused on product and purchasing programs. Last week we talked about everything from what ERP to use to earning customer trust.  If you did not attend, you missed the opportunity to gain valuable insights into your business by bouncing ideas off of some very knowledgeable and engaged people.   It is now only 11 months till our next DPHA conference.  Please make plans to join your fellow Decorative Plumbing and Hardware professionals in New Orleans, October 22 – 25, 2020.     The more we work together the more our industry will improve for the benefit of us all. 

Below are the products. companies and individuals that were honored at the 2019 DPHA conference:

What Gifts Should I Send this Holiday Season?

Let’s think about walking into a showroom, a purchasing office or an interior designer’s studio during the holiday season.  What do you see?  There are large and small Christmas trees, twinkly lights, cookies and candy galore, tall rectangular lavishly wrapped booze boxes and holiday cards by the score.  Lots of people exchanging numerous gifts, thanking their customers for a great year and others trying to be remembered in the New Year.  So many companies and individuals trying to make an impression.  So what happens to all of those gifts?   

The business holiday season is a traffic jam of companies trying to be remembered by old accounts or impress new ones.  Is this where you want to spend your marketing money? Hoping that Johnny at ABC will recall yet another logo coffee cup that will motivate him to lead his next customer to your display?  How many gifts will Johnny receive?  Will yours be the one that is magically remembered?  It is a big HOPE.  But you don’t want to be that company that plays Scrooge and does nothing. 

I would like to offer an alternative solution for holiday brand building.  

I always tried to find a solid charity that offered a holiday card where we could place a picture of our complete team on the cover wishing Happy Holidays.  The money went to a good cause and when anyone asked a team member, they had a good holiday story to share and show where they are in the card cover image.

Doing this freed our holiday marketing money to use during a time when it made a more substantial impression.  By mid-January, a lot of people are back in the day-to-day workflow and miss the “entertainment validation” of the holidays.  This is a good time to take a target to dinner, bring in a catered lunch or hand out gift cards.  By waiting until the January holiday hangover, you will be the lone brand thanking key players and it just might wash away the gift they received from your competitor way back in December. Some companies that follow this plan have a large event in early spring to welcome the building season and rev everyone up.  

This plan also removes the stress of trying to do the best thing for your clients and allows you to better focus on your family’s holiday festivities.  Because isn’t that what the holidays are all about? 

P.S. Let’s never forget that HOPE is not a strategy.

This article previously appeared in the November 22 issue of DPHA’s Connections

The 21st Century Customer Experience

Photo by Alexander Kovacs on Unsplash

21st century retail rule: upper-end retail can only survive by offering an amazing customer service.   

But a great customer experience does not have to be a blow your hair back carnival ride.

An honest, quality driven sales process remains a great customer experience.  Some customers will want a Flying Whoopee but that might not be your customer.

If you set up a solid process, hire smart people and work with good vendors, your customer service experience will be attractive to many.  

It’s not easy but do not make it harder than it needs to be.

Websites Only Take my Jobs on Price! Horse Pucky…

Earlier I wrote an article with the opening line, “So why is it that 47% of top interior designers purchase products online?” and most of your comments were that the websites offered free freight and lower prices.  Wake up gang, that isn’t the major reason designers are buying online. We are losing more business to digital savvy designers that are specifying and buying on the Internet. Jobs that we will NEVER know about. Sure, there are top shelf luxury designers that are price obsessed, but most are looking for easy access to information when and where they want it.  

Every time you lose a job to a low-ball bid, you hear about it directly from your customer.  It hurts badly and sticks in your mind! All that time, all that effort, amounted to nothing.  What about the job at that same design house that was completely specified and purchased online?  You knew absolutely nothing about it and were not involved at all. What is worse for your business, losing a job to a low balling #@!*#**, or never getting a whiff of a large job as it was all worked on online?  

After the recession, website companies remained unsophisticated and price was their key advantage.  The surviving sites, and new designer-oriented sites, offer an addictive combination of an easily navigable user interface and anywhere, anytime accessibility with live solid phone and chat support.  This is why talented designers are working on these sites. It has absolutely nothing to do with price. Do not mix these two up. Price competition is not going away, but in the luxury market it is not as big an issue as we portray it.  People will take the easiest path first.

If a customer comes in and says they want to order a $6,000 list bathtub from lowestofthelow.com, just let them.  Make a note on your calendar to check back when the job is trimming out and ask how that worked out.  I think you will remind them not to do that again. I suggest not fighting individual pricing debates, unless it happens often.  There will always be sites and stores that offer silly pricing. It is really not worth your team’s time, and you are worth your profit.  Take the energy and focus it on the future.

I was not aware how many talented designers were specifying products online until we started to receive RFQs that were 100% built on websites.  When we reached out to these good clients, they told us it was nothing against our team or showrooms, it was that our website was hard to work. So they matriculated their favorite brands’ websites that offered them the intuitive interface they craved.  Now that hurt. We did everything right except offer our good customers the tools they wanted.

We have to believe and think big.  Big like when you opened our business.  We knew everyone would come because our look was so damn good. Let’s take that same attitude and build magnetic web sites. 

Note: Please take another look at the proposed strategy in an earlier post.  “So why is it that 47% of top interior designers purchase products online?” It offers a few tips.

A version of this article appeared in the November 256 issue of DPHA Connections.

If It’s New, Display it!

Photo by Daria Shevtsova from Pexels

If a solid vendor releases a new product, put it on display. No debate. Get it on the floor ASAP!

It is not about your taste, your style or what you think is hot. How many times have you heard the phrase, “I cannot believe they bought that!” There are fabulous tightly-focused luxury showrooms that are directly reflective of its owners’ style.

Roman and Williams Guild is directly derivative of the design style of the Robin Standefer and Stephen Aleshch. They curate the store’s collection of just about everything for the home with their style filter. This curation is also seen at stores such as Room & Board, Rejuvenation Hardware and Blu Dot Design.

They all have their design niche and stick to it. However, if you are to succeed in one or two home product groups, such as luxury plumbing and hardware, be known to have all the latest and greatest. How many times have I heard a showroom saying, “No one will buy that,” and it ends up being the hot look for the year. The truth is we do not have any idea what Mr. and Mrs. Smith will fancy, but it is up to us to make sure we can find it.

Sure some of the new designs die ugly deaths, but that is not the point. If you think every brand always hits the right note, think again. I am not going to dig deep here, but I would postulate that if a designer or go-to vendor hits one out of four, they are in rarified air. 

Our market is too small to only show Euro-modern or transitional. At Phylrich, the great dolphin and swan series only accounted for 2% of product sales, but 7% of dollar sales. We never know what look will ignite a passion in a client. Show the new as long as you can. If it is only a fabulous dust collector, then move on. But if it hits a certain cord, Wahoo.

If I am a successful distributor of a quality company and they invest all the money and time to create a new product line, I will put it on display. In fact, we had the rule with our good representatives that if this brand introduces a new product, get it on order. We wanted to be the first in town to display its new look.

P.S. Vendors: If your good distributors follow this path, you should make sure they are supported in their willingness to get your new products on display. A DPH vendor’s best marketing is making sure the best salespeople in the best showrooms have its latest and greatest on display. Without the display, sales are tough.

Except for a few heavyweights, luxury DPH showrooms are poor marketers. Yell and scream all you want, but it is true. It’s not that we cannot market. We do not have the funds to do so. Five percent of $15 million is a lot less than 5% of $100 million. Heck, running a basic digital marketing package runs between $7,000 to $10,000 a month, not including website maintenance. To reach the design and building trade along with the interested homeowner takes coordination between factory and showroom. Both need to work together to get the word out.

Our strong calling card to our design and trade accounts is our function and deep product knowledge. If the Smiths want a faucet they saw in Domus magazine that is manufactured in Denmark and not yet available in North America, we get it. 

If it is out there, we will find it and make sure it will work as specified.

If it is new, show it and share the story with anyone and everyone.

Anonter version of this post appeared in the November issue of Supply House Times.