The low-pressure sale is back. How to use customer-centric selling to build loyalty and revenues
Walk into one of Yoforia's three frozen yogurt stores in Atlanta, and you'll get a warm hello from a server, who will encourage you to try all four of the company's frozen yogurt flavors. The server might also describe the organic milk used to make the yogurt and talk about the all-natural ingredients that go into the premium dark chocolate, mango, pomegranate, and blueberry desserts.
What you won't get is a hard sell. If you look as if you want to be left alone, you will be. Staffers are told to put themselves in customers' shoes, to interact and be pleasant, but never to nag. Although after tasting the yogurt and hearing about how healthy it is, you're certainly more likely to make a purchase. And Kim's sales are up 40% over last year.
"I take the pressure off my employees that they have to make sales," says Jun Kim, co-founder of the 25-person, $1 million company. All of his staffers are former customers who are passionate about his yogurt. Although Kim doesn't have formal staff meetings, he works on a daily basis with his employees, instructing them to sell service as much as frozen yogurt. He awards staffers bonuses of up to $100 when he sees them going out of their way to help customers and work well with other employees. Says Kim: "We try to focus on the customers, making sure they have a good experience when they come to the store, so they feel their money is well spent and well worth it."
On the surface, that may not sound groundbreaking—treat your customers well, figure out what they want, give them information about your product, and sell them something you care about. But wrapping it all together and persuading your sales folks not to obsess over, well, sales, is something different: customer-centric or consultative sales. A customer-centric sales process emphasizes a low-pressure environment that lets your sales staff act as consultants, offering information and showing how your product or service can help solve a customer's problem. When it comes to yogurt, that may be as simple as helping a customer pick the best flavor. The end goal of customer-centric sales is not only to boost sales and trumpet your brand but also to make customers happy they shopped at your store, building the foundation for future sales.
Consultative sales has its roots in the early history of retail, when our grandparents went to buy something from the local five and dime, where they probably knew the name of the clerk who retrieved their items and told them how much they cost. But the art of the low-pressure sale got lost somewhere on the way to the big payoff, and in the mid-1990s, big companies realized they were jeopardizing their relationships with customers—and the possibility of repeat sales—by being overly transaction-oriented. Today, companies both big and small are rethinking the way they sell their products. "This is a consumer society, but virtually no one likes to be sold to," says Adrian Miller, founder of Adrian Miller Sales Training in Port Washington, N.Y. "[Customers] like to buy what you do in a store." In other words, it's a mistake to think customers simply purchase a product or service. They are buying an entire process, including the customer service, the knowledge of the salespeople, and the quality of the interaction leading up to the sale.
If you've ever shopped at an Apple Store, say, or a Container Store, you already have some familiarity with this type of selling, at least from the receiving end. At Apple, customers can attend ongoing screenings about the latest iPhone or get free technical help from the Genius Bar. At a Container Store, sales associates are screened for problem-solving ability, affability, creativity, and experiences that will help them connect with their customers, who are mostly women in their mid-30s to mid-60s. Sales staff then go through about 240 hours of training to help them excel at the light, informative touch. Rather than working on commission, full-time salespeople start at an annual salary of roughly $45,000—about 50% to 100% more than other retailers pay.
Another way to think about customer-centric sales is to visualize the entire sales experience as a map, says K.C. Blonski, director of travel, leisure, and retail markets at AchieveGlobal, a Tampa consulting firm. Start with the endpoint—the sale—and work backward. After buying, Blonski says, customers should feel engaged and pleased that they shopped at your store. They should have a sense that their money was well spent. They should also feel they were listened to and their needs were met. Finally, they should be willing to return to you before trying out a competitor. The goal is to manage the entire customer experience so you can realistically expect a customer to stay with you for life.
Creating a customer-centric sales process boils down to a few essential steps. First is creating a pleasing atmosphere that feels inviting, in which customers can easily browse and find merchandise. Second, you need a sales staff that is warm and caring, greeting customers when they enter, by name if possible. Lastly, those sales staff need to create a dialogue with customers, present products or services that meet their needs, and offer additional products when appropriate.
At Yoforia, Kim created a welcoming atmosphere with plenty of natural light. He also used a simple palette of colors—white with a splash of either lime green or orange. The decor is mid-20th century modern, and nothing, not even a promotion for the store itself, hangs on the impastoed walls. The store plays contemporary pop and dance music, which suits the predominantly high school and college-age clientele. Customers are encouraged to hang out in the stores with their pals. "We want them to come in and enjoy our fun and unique atmosphere," says Kim.
Similarly, Keith Linsalata, owner of the six-employee, $1.5 million Art Flower & Gift Shoppe in Rockville Centre, N.Y., knows he has about 11 seconds to grab people's attention as they're passing by. Outside his store he presents a seasonal array of flowers—bright perennials in baskets during the summer, evergreen wreaths and poinsettias in the winter. Anyone entering the store, which is open seven days a week, is greeted and encouraged to browse displays that change every three days. Even in a bad economic environment, he expects his sales to be up about 5% this year.
But creating the environment, in a sense, is easy. It's harder to train sales staff to be warm and caring and offer top-notch service that gets people to buy. And that's a big part of what creates the great customer experience you want to provide. According to May 2009 research conducted by Stephen Hoch, a professor of marketing at the University of Pennsylvania's Wharton School, only one-third of consumers said they had a great shopping experience in the previous six months. Of those who did, about two-thirds said a polite and courteous salesperson contributed to it. Fifty-five percent also cited the sales staff's familiarity with the products the store carried. The same percentage said the experience was great because the salespeople gave advice and offered choices.
Linsalata uses a two-tiered system: Everyone is greeted when they walk in the door, and anyone who approaches the counter gets immediate help. Anyone who does not go up to the counter gets left alone to shop in peace. If a customer is looking for something the store doesn't carry, sales staff make every attempt to get it. Linsalata briefs his workers once a week, at a breakfast meeting at the local diner, about which flowers will be available. They're expected to take notes, and they are given bonuses when they exceed monthly sales goals or sell items that need to be moved.
This approach to customer service was clear on a recent Wednesday, a real doubleheader of a day for Linsalata, who was helping a woman with flower arrangements for a funeral—cheaper carnations and daisies, or pricier roses and orchids? At the same time, he was working with another client referred to sympathetically as "The Emergency Bride," who had shown up in tears with her mother the night before—30 minutes after closing—because she had just ditched her florist, with her wedding just three days away. Meanwhile, a sales associate was helping the store's delivery driver, who didn't want to drop off anniversary roses to an empty house on a sweltering day. The associate consulted Google Maps and the store's database to find some of the customers' nearby relatives who could take the roses.
Starting a dialogue without seeming forced and unnatural, and offering information that will lead to a sale without seeming pushy, can be tough for some salespeople and business owners alike. "This is about being engaged and looking someone in the eye and being educated and able to educate consumers when they need it," says Hoch.
Atlanta's Private Bank of Buckhead, which has 21 employees and $7 million in annual revenue, tries to create a dialogue with its customers through luncheons and other events. The bank caters to the wealthy and to small business owners, although the minimum required to open an account is only $100. Most people come to the bank through recommendations, and the bank's revenues are nearly triple what they were a year ago..
One way the bank gets to know its clients is by hosting monthly luncheons, where clients are introduced to bank officers and board members in an informal atmosphere. The purpose is not to sell a particular product but to gather useful information. "We use this luncheon for multiple purposes. There is no mass-selling agenda," says Charles B. Crawford Jr., the bank's CEO. "It's a chance for clients to provide feedback and for us to listen." While the luncheons may not lead directly to sales, they help the bank's relationship managers understand what clients may need in the future.
At Yoforia, Kim uses Facebook to connect with customers and to try to build a community of loyal followers. Online, Kim talks about new flavors and solicits dessert ideas. Recently someone suggested using pomegranate seeds as a topping to go along with the pomegranate dessert, so Kim began adding them. Other customers said they were disappointed the store stopped offering its dark chocolate flavor, so he brought it back.
Art Flower & Gift offers free seminars on wedding and party planning, where it invites couples to meet with other wedding vendors, such as bakers and photographers. In an informal setting, potential clients are offered information on flower arrangements and wedding cakes. "People want information, and they don't want to feel hammered to buy," Linsalata says. He also offers free flower design classes, figuring that people who are introduced to his business are more likely to become customers at some point.
All this is a lot easier if you can hire people who take naturally to the customer-centric sales model. "Consultative salespeople are problem solvers and conceptual thinkers and tend to look at the big picture," says Miller. You can use behavioral tests, such as the Myers-Briggs and DISC, to screen job applicants for these traits, but more often than not, Miller says, a sharp entrepreneur can spot the right candidates during the interview process. "People who apply for certain jobs will share the interests of the company," adds Miller. So Kim looks for customers who love his yogurt, and Linsalata for avid gardeners or people who already love plants and flowers. Typically, consultative salespeople are paid a salary rather than a commission, as this most often promotes taking a longer view of selling.
Crawford says he often hires bankers who are refugees from large banks where customer service is typically less than stellar. "We hire very seasoned and experienced bankers who share our obsession with client service," he says. "We expect this from the people who join our bank, as opposed to just selling bank products."
Linsalata spends hours interviewing his potential sales associates, who are salaried. He'll start by paying special attention to a person's body language during an informal conversation. Do candidates look him in the eye when they are talking? Are their personal appearances tidy? Can they make conversation? "I am looking for a person who is willing to engage," he says, such as extroverted personalities able to forge connections with customers. Once staffers are hired, Linsalata will spend about three weeks training them, which includes teaching some psychological sales tricks, such as mirroring: When a prospect folds his hands, the employee is instructed to fold his hands as well. When the customer touches his glasses, so will the sales associate. "It helps form a bond," Linsalata says. And eventually, a sale.
For profiles of standout independent retailers, go to businessweek.com/go/sb/retailers
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