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Rick Segel shares his experience, insights and ideas about new approachs to retail marketing & the state of customer service in today’s global retail community.

Business - But Sometimes The Lessons Come From Life

December 26th, 2006 by Rick

It’s the holiday season and the numbers are still coming in determining how good or bad your season was. If you were United Airlines, it was a disaster. Having a major hub close down at the peak of your season is a disaster. But if you were a food vendor at that airport, you have set records you will probably never meet again. That is if you were able to get food to the airport. How many hot dogs could I eat if I were stranded there for 3 days? So every business has a different perceptive. Cold weather attire couldn’t have sold well because it really hasn’t been that cold in most northern states. As for jewelry, it has slowed down a bit but there were plenty of jewelers that had record months.

If you had the right merchandise at the right price, you did pretty well. Home décor has been rough but we knew that going in. Houses aren’t selling like they once did and that always has a rippling effect. All of the money that was being made in the real estate boom years just isn’t happening now or for the foreseeable future. Those were some great years but real estate comes in cycles and there will be more good years ahead.

But holidays are a time about families and coming together. It’s the time we forget about business for a little time and get reacquainted with a brother-in-law, a sister, a cousin, or even your children. I am blessed with three of the best kids in the world, all college grads, two with MBAs and all of them with excellent jobs in superior companies. They are not only successful in business but they are married to sensational spouses. I have two sons-in-laws who are like a son and a daughter-in-law who is just like a daughter. I even love my kids-in-laws and we actually go out with them socially. What could be better? Five of the smartest and cutest grandchildren a Papa could have. But let’s not go there.

So what’s the point and how does my wonderful family have anything to do with my business? Isn’t this column about business?

This holiday season I started giving the same advice to my kids that we all need to master and especially in business. My kids were starting to comment or even criticize the lifestyles or priorities of their friends and siblings. One of my daughters is financially very prudent and is a saver. She and her husband like nice things but they have a very moderate taste level. They will have a beautiful 5-bedroom home debt-free before she is 35. Amazing! Her brother and wife love the nicer things in life and have exquisite taste. Paying off a mortgage is not on their radar scope. Savings is not a priority for them. The third family could care less about any material things at all and although they earn the most money, they spend it on activities and family.

All different values, just as all of our employees and customers have different value systems. That is why the Golden Rule doesn’t work. We can’t treat people the way we want to be treated. We can’t try to put our values on other people. If we want to live a much happier life and create a far more successful business, then we must respect the differences. We try to judge people as if we are the only ones that are right. Accept the differences; don’t dwell on them. So what if they do things differently than you? We can all be happy. Don’t impose your views or standards on others. I think we are trying to do that unsuccessfully in the Middle East and it just doesn’t work.

So accept and celebrate our differences. Let’s not try to convert. Let’s just all try to live together in peace. After all, isn’t that the real message of this glorious season?

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The Difference Between Politics and Business

December 19th, 2006 by Rick

The political season is long over but I just attended a workshop where it felt as if it were still going on. Let me explain. It was the classic story that I have heard a thousand times. It’s the story of the little business trying to compete with the giant. All I heard was that the giant doesn’t give good service, the giant sells inferior products, the giant isn’t nice, the giant uses high pressure selling tactics, and that’s why no one should shop there. The giant is big and bad.

That sure sounded like the negative advertising that none of us could stand during the last election period. The unfortunate part about those negative ads is that they work in politics. So unfortunately we will be seeing more of them. But when it comes to business, they just don’t work. The old line is “every knock is a boost” applies here. Putting down your competition only makes you sound like a complaining, wining person, even if it is so.

My old battle cry is businesses don’t put businesses out of business. They put themselves out because they couldn’t find a way to compete. It still comes down to how we WOW our customers.

I spent this weekend at Disney World with my children and grandchildren, going to the Magic Kingdom, Animal Kingdom, and MGM studios. The tickets were $67 each per day and that’s just the beginning. Even McDonalds was $8 for a meal package but all the money I spent was well worth it. Disney sold me an experience and memories. It was the ultimate WOW.

But Disney has lots of money and how could a local amusement park even consider competing with the great and powerful Disney? Just saying that sounds foolish. Yet a local amusement park, named Old Town, did just that by developing a couple of interesting niches. First and foremost, they became the place for restored automobiles. No, they didn’t buy even one. They gave local restored car owners a place to gather and show off their cars. They even have car parades that go up and down the main street. It draws thousands and even people who spend a day at Disney add Old Town to the end of their day. The food, shops, and other rides are flourishing. The other wild niche is a huge bungee jumping ride that is well lit in multiple colors that you see from the well traveled road.

Do they try to compete with Disney? No way! Do they try to put Disney down? NO! They just do what makes them successful. Just focus your energy on the things that will make you successful as opposed to focusing on the negatives.

Follow Up To A Previous Piece on Gift Cards

Many of you have written to me and thanked me for the column on gift cards. You have reported to me that gift cards have been the one bright spot from a relatively lackluster season so far. (I still believe it will all happen during the last couple of weeks of the year.)

I just read a recent report on gift cards, sales, and their usage. Sales and usage are at all time highs and growing but the amount of unused cards is staggering. Best Buy’s unused gift cards for 2005 were $30 million. That might sound sweet now but it could eventually hurt the concept if people start stock piling unused cards. So encourage their sales, encourage their usage, enjoy the benefit of non-usage, and worry that this product doesn’t come to an end.

Have a great holiday season and thanks for reading. I promise you some wonderful surprises for 2007. Happy Holidays!

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The Stages of Learning

December 12th, 2006 by Rick

Great leaders are great teachers. Retailing today has become a job of teaching and training because the turnover rate of employees has hit record levels. Few people stay at a job very long today. I recently met a young man who had worked in 7 different stores at one mall within 18 months. We talk about customers not being loyal but what about our employees? It is easier to attract good customers than it is to attract good employees.

I recently coined a new definition of what good customer service is. I believe it’s the difference between just making the sale and having the customer return to the store again to purchase more.
The question is how do we train our employees to be able to deliver the kind of service that will keep the customer coming back again and again? It comes down to explaining what to do, having the employees try, fail, be corrected in a positive manner, and try again. Or repetition, repetition, and more repetition.

There is one other concept that I call The Stages of Learning which I learned years ago, and it has always helped me put training in perspective for both myself and the employee. It works because it lets everyone know where they are at in the training cycle. Basically, it controls everyone’s expectations.

These are the 4 stages:

  • Stage 1. Unconscious / Incompetence
    This is the stage that the brand new employee is at. They don’t know what to do and don’t know how to do it. Or in simple terms they are clueless.
  • Stage 2. Conscious / Incompetence
    This is the stage that the employee is at after they have been taught how to do what they are to do. So they are aware of what has to be done, but they don’t know how to do it yet. Or they have a clue but they don’t have any experience and have never really done what is expected of them. They are at least aware of what has to be done. The mistake that happens here is when we expect our people to perform at high levels. They just can’t yet but they are getting there.
  • Stage 3. Conscious / Competence
    This is the stage where you are aware of what has to be done and you can do the job but you have to think about what you are doing all of the time. Or you are slow. It is the same as when you first learn to drive, when you have gone out with a teacher or a parent and just got your license. You know what to do but have to think about it all of the time. If you expect too much from your employee here you will lose them out of frustration. Just knowing and understanding this stage will help better understand your employees. This is also the place where positive reinforcement and compliments go a long way.
  • Stage 4 Unconscious / Competence
    Your employees are aware of what has to be done and they can do the job without even thinking about what to do. Or they have become a Master. This is the point we strive for–when you just do what you do and don’t really think about the process. Three years ago (actually it’s 151 weeks ago), I struggled with writing this column. Now after writing 151 columns I look forward to this Sunday night writing time. I don’t have to think about the mechanics of writing; I just write. Looking back I never thought I was ever going to get to this point, but I did.

Your employees will get to Stage 4 if they know where they are and you know as well. THIS WORKS! Try it.

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