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Retail Success Factors, Part ll: Increase sales in a tight retail environment

April 16th, 2013

Category: Customer Relationship Management, ERP Enterprise Resource Planning, Online Retailing, Retail Business News, Retail Business Tips, Retail Innovations, Retail Selling

Male Sales Assistant At Checkout Of Clothing StoreRetailing has been given some good news recently. The Australian Bureau of Statistics (ABS) released figures for January 2013 showing a growth of 3.4% on the same period last year. However, many retailers are still doing it tough. This is due in part to high fixed costs like rent and staff wages as mentioned in last month’s article. That article looked at how you can substantially lower costs to deliver savings while today’s article will look at how you can increase sales and thus profits, even as retailing continues to experience bumps on the road.

We look at 2 key avenues for increasing sales: extending your bricks and mortar operation online and marketing and promotions.

Online store – minimal staff investment while selling 24/7

If you’re not sure whether adding an online store to your bricks and mortar operation will be a drag or a lift to your business, then the Sydney Morning Herald article on Specialty Fashion Group might give you pause. They recently announced a lift in profits due to a number of initiatives such as an increased focus on online sales.

Having an online store can greatly multiply your sales in the following way:

You can continue to sell outside normal trading hours, 7 days a week, and importantly when your customer is in the mood to purchase, which might be at 10pm or 2am.

  • You can attract new customers who prefer to shop online, or who are outside the geographical catchment areas of your stores.
  • It lets you promote the product range in your stores which will generate more store traffic.
  • It lets you sell a wider range of product beyond what you showcase in your bricks and mortar stores
  • Even better, some advanced retail ecommerce platforms also provide easy integration to other digital sales channels that are popular with consumers such as eBay and comparison shopping sites.

    • eBay is also a great channel to turn slow- or non-performing stock back into cash, rather than have it languish in stores/ warehouse where it’s just taking up valuable space.

One of the biggest disincentives to selling online for small to mid-sized retailers is the effort involved in establishing and maintaining an online store. Managing the delivery process can also be a major hindrance depending on the type of products being sold.

Thankfully, there are now low cost software solutions including one from Creative Computing that allow for rapid online store creation, automatic maintenance of online stock levels, etc., and which also provides integrated shipping/delivery management.

Marketing and Promotions – low cost yet powerful way to increase sales and beat competition

While some research has indicated that retailers are experiencing higher marketing costs and this is putting downward pressure on profits, it doesn’t have to be that way. Combining a well-designed marketing strategy and consistent execution of promotions with the right Retail CRM software will see you gain more customers, attract a strong and loyal following, and sell more.

Well designed and executed marketing strategy and tactics involve conducting frequent and highly targetted promotions that offer something different every time, such as: 30% off, BOGOF, free delivery, bonus item, and so on, with the occasional 10% off storewide promotion. The idea is that each promotion looks unique and over a selected period of time you’ve made at least one offer that would appeal to each person in your customer database.

Utilising a retail CRM system can greatly increase your sales in the following way:

  • You can capture new customer details, purchase history and preferences at the POS instore, via your online store or other sales channels like eBay.
  • You can then offer targeted promotions to those that are most likely interested in your offer. These offers can be sent inexpensively via email or SMS.
  • The best CRM systems also manage your loyalty programs, helping you reward faithful customers with little effort on your part. A quality CRM system should automatically manage loyalty points’ accumulation, redemption and reporting. It should also alert your sales staff of exclusive discounts and special offers to those on a loyalty program. Having a way to easily and consistently reward loyal customers will increase sales whether times are hard or good.
    • ­To ensure Loyalty programs help you increase sales, it’s important to reward these customers differently. Promotions that give them a sense of entitlement or makes them feel extra special work best. For example an exclusive event: first look and option to purchase new range before it’s publicly available.
    • Other loyalty promotions might include customers earning discount vouchers whereby redeeming the voucher requires them to return to your store to make an additional purchase. You could also use time-limited ‘bonus’ vouchers sent to some or all loyalty customers which can generate additional sales at a traditionally “slow” time.

Integration is important if you want your retail system to help you increase sales, cost-effectively

Key to getting the most out of retail technology is integration. As mentioned above, it’s important your online store is integrated to the back end, and this is also true for CRM software. Increasing sales in today’s retailing environment demands you have a holistic view of your retail operation. Having insightful, up-to-date ‘data’ available at the touch of a button, helps you to quickly and easily adapt to changing customer demands, marketplace fluctuations and global pressures – so whatever the challenge, you can still sell more products, more often.

To find out how CONTROL Retail Management system drives sales upwards, contact us, or phone Bernie Hogan on 1300 646 536.