What Do You Do When the Customer Lies to You?

I received an interesting email from a friend, Dave Feltz, a great shoe retailer in Oklahoma, which discusses a topic we have to deal with all of the time.

Hey Rick,

I just had a customer in my store who wanted to show me the pair of shoes he “bought” from me that he was having a problem with.  Well I looked at the shoe, and thought that doesn’t look like one of my shoes, but I figured I’d give him the benefit of the doubt and took his shoe and checked the stock number against my computer records (which I have kept for 6 years.) Well the computer said that the stock number couldn’t be found, meaning that I had not ever had this shoe that the customer was claiming that I sold him.

I told him that I had never had that shoe, and that perhaps he was mistaken, to which he replied, “I bought that shoe here, I buy all of my shoes here!”  So I asked him what he wanted me to do for him, and fortunately he just wanted to show me the problem and buy another pair of shoes, and didn’t want any kind of restitution. (I wouldn’t have given any since I know that he didn’t buy it from me)

Then I asked him for his phone so I could check to see if he was a preferred customer. When I checked he wasn’t signed up so I had no way of checking if he had purchased the item or not.  So now I have no history, no receipt, and just his word that he bought the shoe from me…which obviously he was mistaken.   In this case he was just trying to inform me how the show wore but what if he asked for his money back or even a credit for another pair of shoes?

So I got to thinking that this might be a topic for this week’s tip.

As always Dave is right. This is a great issue and how do you handle it? Years ago I was on the Sally Jesse Raphael Show representing retailers on a show entitled “People who buy clothes wear them and return them”. There was a young man on the show who boasted that he hadn’t bought any shoes in years because every time he buys a new pair, he then returns them to a department store claiming they wore poorly made and the store would give him a brand new pair.

Is he wrong? Yes. But is the department store wrong for giving him a new pair of shoes? NO! Why? Because once we get into a case of product liability, the consumer is going to win every time. Besides any customer who complains about the quality or reliability of a product we, in turn, should return that product to the vendor. Vendors don’t want any consumer ever to be upset about quality issues. Many will even write letters of apology directly to the customer. The problem comes in when we are no longer doing business with the vendor because then we lose.

There is a bigger picture here. What percentage of your customers will actually try to defraud you? Yes, I agree, it is the most annoying part of retailing. BTW on The Sally Jesse Show, I shared how I refused to accept a return from someone who bought a dress for a wedding and then returned it and expected all of her money back.

But I have changed my thinking for two reasons. First is the product liability issue which is all over the news today. And secondly returns are such a small percentage that it’s not worth consuming ourselves with all the negative issues. Remember 4% of your customers are Pushy, Loud, and Obnoxious (members of the PLO) but the rest of them are just fine. Why focus on the 4%?

Before someone writes to me all in a hissy fit thinking that I am advocating that we should give the liars and cheats whatever they want, that’s not my belief either. I can’t say that because I have been in your shoes and trust me when I say “I feel your pain”, but is it worth it?

I have consulted for stores that judge consumer confidence on the amount of returns they have. They feel that if the customer is returning more, then they trust the store more, and end up buying more. In other words, they would prefer to have the customer say, “If I don’t like it, I will just bring it back” rather than saying, “I don’t know if I should buy it because if it’s wrong they give you a hassle about a refund”.  We can win the battle but lose the war.

So, if you want to vote as to what to do on this one, here are your choices:

1. The customer bought it, owns it, but can return it only within the store’s regular refund policy
2. Give the customer either cash back or credit card credit for any product liability issue. No hassles.
3. Give a merchandise credit for your store only for any product liability issue.
4. For any type of a return, give the customer whatever they want whenever they want to return it, even if you know they are being cheats.
5. For any type of a return, give the customer whatever they want whenever they want to return it, only with positive proof they bought it from you.

Click here to cast your vote and see live results.

The Rules of Retailing Have Changed

A Consulting Experience We Can All Learn From

This week I was asked to consult with a husband and wife team, owners of a gift/home décor store in a city close to where I was speaking. I actually prefer to call it evaluating a store but let’s not get bogged down with semantics. The timing worked out perfectly because I wasn’t speaking until the afternoon. So this wonderful couple, with whom I instantly fell in love, picked me up early in the morning and off we went to their store. Before you think I might be talking behind someone’s back, this article is being written with their permission. However I still won’t reveal the name of the store.

First, the store was located in a beautiful upscale suburban area in one of the new style strip clusters. It consisted of a series of interesting, contemporary shops laid out in an inviting manner with accessible parking. The name of the store and the logo were as upscale and contemporary as the rest of the shopping center. The one word I would use to describe the area, shopping center, and store would be hip but cool wouldn’t be far behind.

The owners had been in business for 20 years but a few years ago moved into this new location and more than doubled their rent to $6,000 per month. As you walk into the store, you see a beautiful assortment of merchandise laid out in an orderly manner. That was the first issue I had with the store–it lacked any type of signage that would aid in my shopping experience.  There wasn’t any type of threshold signs that either featured a vendor or artesian. There weren’t any signs that announced events, classes, sales, or any special promotionally priced merchandise.

The store didn’t have a promotional calendar or any events scheduled and the website would be considered primitive at best. They didn’t sell anything from the website but how could they because they didn’t show any merchandise on the website? Basically their web presence was nothing more than a yellow page listing.

I asked how they defined good customer service and their answer amounted to being pleasant and friendly to a customer. They had a data base but they only had 20% of the customers’ email addresses and there were NO indications of any organized activity or development of that asset. There was one disturbing comment. They said that customers don’t want to give them their email addresses. NO ONE wants to give their email address unless the customer sees some real value in giving it. There was NO reward for signing up. I wouldn’t give mine either.

I then met the two key employees of the store. They were very attractive, bright, middle aged woman with lots of retail experience. I suggested a few ideas to them pertaining to selling and becoming more aware of multiple sales. But frankly I don’t think anything will change. Why should it change? If they were to change, it would take them out of their comfort zone and they might fail or feel uncomfortable. After all, the only people who like change are babies who need to have their diaper changed.

The owners were also resistant to adding any signs to the store as if to say I wanted to junk up the store. On the contrary, I wanted to enhance the shopping experience and the look of the store. This store had beautiful merchandise that had interesting stories to tell with a staff in the store that would tell when they had the opportunity. That’s where the problem and opportunity lie. When a customer insists that are just looking and they want the salesperson to just go away, the sign keeps working and working and working. When was the last time you heard a customer tell you to remove all your informative or educational signs in the store? NEVER!

What’s the bottom-line? This store is NOT making any money and if it doesn’t change, it could be another retail casualty. That would be a shame because the taste level of the owners is so high and their spirit is so wonderful. This store might have survived 20 years ago but not today. Retailers just can’t open a beautiful store, in a beautiful area, with beautiful merchandise and wait for the throngs of people to come in to give them money. Customers must be developed and nurtured using the latest of technology, tools, and measuring instruments. A store MUST be proactive by experimenting with different ideas that get evaluated for performance.

All of these ideas might not work, but they certainly have for many other retailers. However, without any changes, their future is inevitable. The sad part about the whole thing was the fear in the wife’s voice about asking their employees to make any changes. She said, “They aren’t going to be happy with changing and they might get upset.”  She is right but they will be even more upset if the store ceases to exist.

Having said all that, I expect this store will have a very quick turn around because the owners and employees alike are just too bright and nice to ever let this happen. So forget the doom and gloom and get to work– there are a lot of things to get done!

I hope you all enjoyed this look into another business and I can’t wait to get back to that store to see all of the changes that have been made.

The Results are In!

We have two winners! BUT this is so much more than just about winning. This exercise is rich with learning points that we can all learn from. (I already did.) There are some interesting aspects and the first one is that there were not as many entries as I had expected. There were approximately 50 entries for each contest. I wasn’t sure what I should read into that. At first I was shocked because when I asked for reader response in the past, I got a much larger response. But then I thought why would anyone even want to share their businesses offer with the world? But then I said why not?

Then I realized that some people might be embarrassed to share in the fear of not feeling they were good enough. Then I said to myself “OOPS, maybe I just picked a topic that wasn’t as popular”. I was committed so we proceeded with the voting. Well, the amount of voting dispelled any negative thoughts about a lack of interest. We actually broke a record for reader response. That turns out to be the first clue on the road to discovery. People didn’t want to enter but they certainly wanted to observe and comment. But that’s just the tip of the iceberg.

The next learning point came in reviewing the quality of the entries. The majority of the offers were just OK. Many of the entries focused more on the business than on what the business could do for the customer. Having said that, there were some excellent entries as well. The people who voted clearly recognized the strong offers. This, when you think about it that, really means is that it was tough to write but the good entries are easy to recognize. Great offers must be easy.

The next thing I learned, that I suppose I knew but forgot, is that the best offers were not necessarily written by marketing pros. Obviously, I can’t be sure if the winners had help but some of the pros who entered that I recognized as marketing experts were not necessarily the winners. Creativity comes from all over. (I once paid a young kid $25 to design a logo. We used it for 18 years. I paid a high end design firm $5,000 for a redo of the logo that lasted only 2 years because everyone hated it.)

Here are some of the other things I learned from this experience:

• If it’s too cutesie, it doesn’t work
• If you can say “So” or “So what” it doesn’t work
• It can’t be a hard sell
• You can’t use commonly used expressions. They’re not original or unique and they take away from your business
• The good ones create a visual in your mind
• The good ones are thrifty with the amount of words they use. The fewer the better.

OK, here are the winners and my commentary:

In 5th Place from Chris Virgin at Virgin’s Nursery Inc.
We turn houses into homes. Let us transform yours.

I have the image of a house without landscaping and plants then one with beautiful ones. This makes me want to go there.

4th Place from Stephanie Hill at Winterthur Museum Store
Our gifts have taste so you don’t have to.

I would describe this as not the prettiest but you get the message loud and clear. Yes, I would shop there because sometimes I need a little help with a higher level of taste for that certain person.

3rd Place from Hillary Moulliet at Art Space Studio
“Your inner child called and she wants her creativity back.” Art Space Studio…for the fun of it

This is interesting because it doesn’t fit into the classic position where the offer comes before the name but it conjures up an image of playing and painting. Nice job

2nd Place from Laura Snipe JC Snipe Jewelers
“If you have the girl, we have the ring.”

It says without saying it–If you have the RIGHT girl we have the RIGHT ring. I also get a feeling of a specialist in diamond rings and especially engagement rings .I love it when just a few words mean so much.

The Grand Prize Winner is from Ziggy’s Bar and Grill in St Kitts, B.W.I.
“Where the beer is the coldest and the sunsets are free.”

That’s an offer that’s hard to resist even if you don’t drink beer. Can’t you just picture a place to sit with friends, watch the sunset, and do it in total relaxation? As if to say it doesn’t get any better than this.

The 4 runners up will be receiving a book from me and the grand prize winner will receive a complete set of all of my work.

One other note: The winners were all selected by voting and I did not vote but I must admit I do agree with the winners. Great JOB!

As for the winners on creating an offer for me. This proves that you need to listen to your customers and clients because the one offer I loved hardly got any votes. It was submitted by Susan Newark from Triple M Farms, “I can make your business special.”

As much as I loved it, it didn’t make it in the top 10.

There were three very interesting entries:

The 3^rd Place Winner came from Chris Virgin of Virgin’s Nursery which nailed the concept of an Irresistible Offer but one I can’t use.
“I’ll improve your business or buy it from you.”

That is the true essence of what a strong offer should be, but having an offer that strong could get me into trouble. How can you control it where I write and speak to so many people? If my business was as a consultant only I would jump on it.

The 2nd Place Winner and very close to the grand prize winner came from Teressa Morris from Golf Etc. with this offer:
“Improving your business, one simple step at a time.”

That is what I do and the use of the word simple makes it powerful. After all I did write a Dummies book. I really like this one.

The  Grand Prize winner and overall vote winner went to a Main Street Legend and my good friend, J.L. Schmidt, the head of the Nebraska Main Street Association with this simple gem.
“Rick Segel shows business people how to do what they do best…better.”

That’s what I try to do everyday. JL you nailed it. Thank you. The books are in the mail.

I hope this exercise helped you do what you do best, BETTER.

This has been fun!

Ask Your Customer

If there is any lesson we can learn from last week’s challenge of the best offer/ business slogan, it is to ask your customers for their opinions. For those thohat might not have read last week’s column, I not only offered a competition for the best business offer to their customers but I also asked what offer or slogan I should use.

The problem is we might think of ourselves one way but that’s not as important as the way our customers perceive us. I promised that I would publish every suggestion and we would all vote on the offers we liked the best. As opposed to publishing them in this newsletter, Roland, my technology genius, has created a separate page to review and cast your vote to the one you like best.

It is killing me that I can’t share my opinions on some of the entries but I will save that for next week. The link to get to the page is www.RickSegel.com/offers. I invite all of you to vote even if you didn’t enter. Use these entries to inspire your thinking or to either reinforce your offer or create a new offer or slogan. Even the offers that you hate or you feel are ridiculous are more important than you realize. When you say that something is terrible, foolish, or just plain dumb you are really benchmarking your taste level. Ask yourself why you dislike it so much. The answer might just teach you a little something about your preferences.

Let’s get back to asking your customers their opinions about any type of issue that relates to your business and your customers. It is so important because it gives you that objective insight and the best of market research you could ever get. Plus by asking your customers they now feel closer to your business. Next week when I announce the winners of these two contests, I will have a lasting connection with those two winners. They are also getting a quick boost in self esteem and a new sense of accomplishment. This is good.

Then when you realize that I generated new original material for you, my readers, I hopefully inspired some new thinking and I will have the benefit of a new offer and signature line. Now ask yourself– how can you ask your customers their opinions? Let’s call it, “How do you ask your customer?” Do you use a survey? Do you ask one to one? Do you write to them via email or do you have a comment card at the desk to fill in? Maybe you have a contest. Whatever way you decide, never underestimate this valuable resource that we rarely employ.

Again don’t forget to review the submitted ideas and VOTE for your favorite. Next week’s article will comment on the entries and announce the winners.

I also hope everyone was impressed with our new system to acknowledge everyone who responds. We aren’t perfect but we are definitely getting so much better. I want to thank the readers who took me to task, deservingly so, for not having have a better way of responding. I can only call that growing pains but even that is a pretty flimsy excuse. A customer’s trust is and should be the most cherished asset a business and a person has. There are no excuses for ever violating it.

VOTE… VOTE… VOTE… VOTE! Click here to vote.