Article Number : 4804 |
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| Date | 9/4/2009 9:16:32 AM |
| Written By | LGM & Associates Technical Flooring Services |
| View this article at: | //floorbiz.com/BizResources/NPViewArticle.asp?ArticleID=4804 |
| Abstract | By Steven Feldman ORLANDO, FLA.—Flooring America/Flooring Canada members, more than ever, need to increase their focus on driving traffic through their doors and converting those leads into sales. That was the theme of... |
| Article | By Steven Feldman ORLANDO, FLA.—Flooring America/Flooring Canada members, more than ever, need to increase their focus on driving traffic through their doors and converting those leads into sales. That was the theme of the group’s recent summer convention here. While the direction may seem obvious, the truth is such that in recent years the group has been focused on defense, things like cutting expenses, according to Vinnie Virga, president. “Now is the time for us to change our culture. We have to go on the offensive and be aggressive. We have to move from being gatherers to hunters.” Becoming more aggressive in lead generation and lead conversion will lead to significantly improved profitability, he said. Many of the tools to which Flooring America members were introduced at the convention were developed though the findings of extensive research undertaken during the first half of the year by parent company CCA Global. “The research was designed to better understand today’s consumer, said Debi Binder, vice president of marketing. “Her path to purchase, the steps she takes through the process, how long she is in the market, the media she uses and more. It was very enlightening.” Also learned were the things that motivate customers to respond and buy, especially during tough economic times. These will be incorporated into Flooring America’s advertising and operations, and serve as groundwork for the group’s 2010 integrated marketing strategy. Because CCA Global believes the research findings and ensuing marketing strategy will give its groups a competitive edge in the marketplace, the results will remain proprietary. However, Virga shared a few with FCNews in an exclusive interview: 1. Customers are more focused on value today than ever. 2. There are more dramatic changes in consumers’ shopping habits in 2009 versus 2008 than in any other year. 3. While just about everyone is focusing on new media such as the Internet and social networking, traditional marketing—TV, radio and print—is not dead, although the mix has changed. 4. Reversing what may have been a 10-year trend, consumers are shopping more stores. 5. Consumers are negotiating much harder. “That can be attributed to the national media,” Virga said. “If you watch the “Today” show, they are advising you to ask for a discount. Consumers have become treasure hunters. It may not be the lowest price they’re after, but they are looking for a product they like at a perceived value.” The bottom line is that, yes, there are fewer customers out there, but they are still out there. In illustration, two years ago 6% of consumers were interested in buying floor covering. Today that number is 2%. The secret sauce is demonstrating a reason for them to come into a store today and buy. That is why it is imperative for members to create urgency in their advertising. And that advertising must translate to the store itself. “There can’t be a disconnect between the ad and the store,” Binder said. “She can’t see excitement in an ad that is not translated to the store. Therefore, the people in the store must create that excitement.” She cited Flooring America’s proprietary value pricing strategy as an example. Aside from acting on its research findings, Flooring America is turning its attention to salespeople, particularly because it believes in many big retail stores, especially during the good years, they became passive. To that end, an effort is under way to teach anyone who touches the consumer that every potential customer is worth gold. “Salespeople are not just order takers,” Virga said. “They have to mine the prospects, be aggressive and follow-up relentlessly.” The group is offering an unlimited education program via live training, Webinars and its online university to ensure members’ staff are fully up to speed and maximizing every opportunity. Members with whom FCNews spoke had varied thoughts when asked what they took home from convention. Scott Kemsley, Flooring America Carpet Studio, Lansing, Mich., realized the importance of having a significant Web presence as opposed to limiting his exposure to more traditional media like TV and radio. “I learned that 80% of consumers shop online before they ever come into your store. I don’t have a Web site now; I was just counting on theirs.” He added the hunter-gatherer analogy hit home, admitting his sales force has been in the gathering mode for some time. “We had that luxury, but no more. So we signed up for a veryintense education program that specifically shows how salespeople can go out and look for business, and we will incorporate that into our weekly meetings.” Vision update Vision stores continue to outperform their Flooring America peers “22 to 26 points” despite the economy, according to Virga, and members are beginning to realize it. “I think the fact that members with multiple stores who have converted one to Vision are converting second and third stores because it has made such a significant difference.” And the performance is supported by the numbers. “Vision stores show a higher average ticket, higher profit margin and higher sales volume.” Kemsley just completed a Vision conversion. His reasoning for doing it now, rather than when business picks up? “Our marketplace is very depressed, so consequently, my competition is laying low in the weeds. But everyone in town is professional. They all are just hanging on to their money. So I have to be ready when everything pops. I want to be the most beautiful flooring retail space in the area, and I think I accomplished that.” Credit One thing that has negatively impacted the flooring industry is the tightening of the credit market. In other words, fewer consumers are getting approved at point of purchase. Not so for those walking into a Flooring America store. “CitFinancial, the group’s consumer financing house, has an unbelievably high approval rate—and it has not decreased [despite the credit crunch],” Virga said. “This is a big competitive advantage.” He added that Flooring America is finding more and more consumers using longer-term financing, “and that is translating into more sales for Flooring America members. And corporately, we consistently do finance buy-downs, where we buy down the rate for long-term financing to make it more affordable for the members.” |