October 9/16, 2017: Volume 32, Issue 9
Even today’s most tech-savvy retailers, manufacturers and distributors realize it’s not enough to merely have a “presence” online. Proponents say success requires just the right mix of a content-rich website, interactive social media efforts (both inbound and outbound) and effective search-based, lead-generation tools. In short, all these elements—combined with traditional face-to-face selling, of course—all need to seamlessly blend together to help retailers maximize sales opportunities and develop potential repeat business in the process.
To discuss this critical integration, FCNews managing editor Reginald Tucker sat down with Chase Shiels, CEO of 4me Group, a Cincinnati-based tech start-up specializing in helping dealers convert more browsers into buyers. Utilizing its suite of cloud-based sales management software—including its signature Lead Tool program—the company works with several high-profile independent floor covering dealers as well as members of large retail buying groups. If that wasn’t enough, 4me Group has developed lead-gen programs for some of the industry’s largest manufacturers. It also has a successful track record with companies operating in the real estate sector. The goal is to help retail businesses provide a better customer experience.
In this discussion, Shiels not only talks tech but also delves into the importance of having a thoroughly integrated lead-generation, customer relationship management (CRM) system.
Q: Before we get into the actual software products, give us a little background on 4me Group.
A: I’d say we’re a combination of ex-operators and technologists—industry veterans who understand the building products retailing market. Two of our founders are successful former owners and operators of lumber distribution and dry-kiln facilities focusing on imported and domestic hardwoods and custom millwork. Our team has experience in all three key points of the supply chain: manufacturing, distribution and retail. More importantly, we have experience selling to modern consumers. As a group we are very experienced in bringing new technologies into different industries.
Q: Explain the transition from the manufacturing side of the business to the marketing end.
A: My dad and I got out of the family lumber business, and I went to work in the car business. I was in sales in the middle of the recession. The owner of the automotive retail group I worked for spent several hundred thousands of dollars a month on online advertising, but he didn’t feel his sales staff was doing much with the leads being generated by all this advertising. The owner got fed up and pulled all the online leads from his entire sales staff and gave them to me and my business partner, George. I managed the division of the company that comprised Porsche, Audi, Maserati and Volvo. Together we managed between 300-400 new sales leads per month. Within about 90 days we were accounting for somewhere between 35%-40% of the monthly sales volume. We took all these leads that were supposedly “garbage” and converted them into sales. Mind you, we did all this during a recession, which is not a good time to be selling $100,000 cars. But I’ve learned a lot about lead generation, sales processes and CRM systems.
Q: What did that process teach you, specifically?
A: I learned how a sales process should look, how you can most effectively get someone to come into the showroom and buy a car—even when the person was not located in the [same] state. I did a lot of national and international business. I also learned about the importance of CRM platforms in helping salespeople turn every potential customer in a paying customer.
After I left the car business, I began working with another partner on building a lead-generation website geared very heavily toward specialty flooring retailers because. Homeadvisor.com, which was called Service Magic back then, was only servicing contractors—not brick and mortar stores.
Q: Have you learned anything that has surprised you?
A: Statistically speaking, many sales reps—about 48%—don’t bother to follow up. Furthermore, something on the order of 80% of sales reps don’t close until after the fifth to 12th contact. So what happens with lot of these online leads is when you don’t respond right away when they’re paying attention, you don’t get ahold of them and then you have to try contacting them again. There’s a cadence effective salespeople follow—i.e., call/send an email; call/send a text, etc. It can’t be a one-and-done situation. Unfortunately, most salespeople will call a lead just once, follow up with an e-mail and then throw out the lead if they don’t get a response.
Q: In your opinion, why are so few RSAs, percentage-wise, following up on leads?
A: We did a podcast recently on social media, and we learned that many of the things we’ve been talking about are not widely accepted in this industry. Here’s the thing about online: If you don’t contact someone who submits an online inquiry in about 10 minutes, your chance of converting that lead into a sale decreases by a factor of 10 by the time you get to 30 minutes. Furthermore, if you don’t respond within an hour, your chances of converting that sale are preposterously low. That’s from an independent study, “Lead Responsiveness Management,” which insidesales.com recently conducted.
Online leads really require you to be constantly on your game. It’s helpful to have a CRM platform that instantly lets you know when you have a lead, and then you have to be inside that platform; it has to be part of your daily routine. Basically you have to adopt the technology to make the online lead really beneficial for you.
Q: Where are retailers falling short when it comes to adopting or implementing these CRM systems?
A: Five years ago retailers could simply “manage their leads,” but it’s just not enough today. Many store managers resort to paying someone to do syndicated social media content, which they then publish for thousands of other people. Here’s the problem: Content syndication absolutely kills your Google ranking and destroys your SEO. So you might hear a dealer say, “Yeah, our business does Facebook,” but it’s not enough. What dealers need is a full-suite CRM system that encompasses everything from first contact all the way to after sale, which includes remarketing to customers you have already serviced in the past.
All of these initiatives help salespeople better connect with their customers and decrease the time it takes to provide the customer more value. From a marketing perspective it’s basically the Holy Grail since it offers multiple touch points and a breakdown of where your target customers are by channel.
Q: Tell us how Lead Tool came about.
A: We invented Lead Tool partly as a solution to our own frustrations. It was developed with one goal in mind—change the game and offer an intelligent and useful platform for building material retailers, distributors and manufacturers, and ultimately help them make more money.
Our platform offers a place where manufacturers can send online leads; their customers can manage them and their retailers can run their entire sales business off our platform. It’s a full-suite CRM. We cover the entire sales cycle; lead management is just the front end where the qualification takes place. Then there’s the sales management component, where you’re actually trying to close the sale; and, finally, after-sale management, where you’re scheduling the installation or calling to ask for a referral. Then you have remarketing, where you’re going back in and re-prospecting for other sales opportunities in other areas of the home.
We are big proponents on moving the industry forward when it comes to technology. With our founders having owned/operated a company in the building materials industry and our core team having already revolutionized the real estate industry with technology, we are now doing the same in the flooring industry. We already work with several Top 50 retailers and have partnerships with manufacturers such as Shaw and Mannington as well as buying groups such as Floors & More.
For many of our clients, it’s important to convey the need for CRM before we talk about selling a particular product. We have a unique perspective on this because we’re the only real tech start-up in the space that’s doing this day in and day out. For us it’s not a side project.
Q: You mentioned the “ease-of-use” aspect of the program. How do you facilitate training when you bring on new clients?
A: The cool thing about our system is we’re entirely cloud based, so we do most training via the web. We have a full implementation process; it’s pretty straightforward and very easy. The nice thing about it is it goes as fast as the client wants it to go. For example, after completing a sale we will schedule a session with the succession team. There’s an initial phone call where we ask the client what their objectives are: i.e., do they want to close more online leads? Or do they want to have more oversight of their entire sales pipeline? We focus on what’s going to make this a valuable tool for the client’s organization.
Q: How long does the implementation process typically take?
The implementation can be done within a week or two for those clients who really want to hustle. In some cases it can take about 30 days. We train every single person who’s going to be on the system, whether it’s group training or one on one. And this continues with the life of the system—that’s why we call it a “success” department as opposed to a “support” department. We are very proactive in this regard, and we provide reporting to our clients on a regular basis.
Q: Some retailers we have spoken to say their salespeople are reluctant to use CRM programs so they won’t buy it. How does Lead Tool address this issue?
A: At the end of the day it’s really a leadership decision. The main thing we’ve learned is the industry, on the whole, is really far behind in terms of buying in to what’s going on in the world. The fact is people are interacting and buying differently, using social media, etc. Retailers really need to understand their customers’ retail footprint. You have to buy into the mindset that people are buying differently. Customers today expect mobile payment options, they don’t want to come back to your showroom and sign a contract. It’s all about making it easier to transact.
Q: Can you provide an example of how this system has worked for other industries you service?
A: For the real estate industry we’ve developed systems that allow people to pay for a home using their mobile device; we’d like to do the same for someone who might spend, say, $10,000 on a new floor.
We recognize this is a massive change for everyone. While CRM systems have been around for 20 years and is the gold standard in almost every industry, it is new to the flooring/lumber/furniture space. We try to get new adopters to embrace the sales process and really think about the pipeline, especially if they’re coming from a pen-and-paper process. We want all our clients to kill it out there and make that transition process as smooth as possible.
Q: In terms of ROI, how soon after implementation of these lead-gen and CRM programs can a retailer expect to see tangible results?
A: In full disclosure, I can only speak to our systems and the publicly available data we have. In general, the ROI on CRM is about 700% and—that’s the accepted standard that we obtained through a third-party study. But in our case, we have customers who will see an ROI immediately.
For instance: The average flooring sale is about $2,000; our smaller accounts probably spend about $2,000–$3,000 per year with us. If you are only following up with half of your sales prospects, then all of a sudden you put in a CRM and you start following up with 75%–100%. In general, for every dollar dealers spend with us, they’ve logged about $80 in total sales. That’s just the average; we have some customers who are logging $200-plus for every dollar they spend with us.
I would expect someone who adopts our system to have an ROI within 30 days—even if they paid upfront for a year. The longer you’re on it and the harder you’re working the system, the more you’re going to get out of it.
Q: What’s your message to retailers who have not yet adopted integrated CRM systems?
A: It’s important to convey to the industry the amount of significant change that has taken place in recent years. People want to buy differently, whether it’s a builder, homeowner, etc. Understanding how the retailer customer wants to buy and then catering to that customer.
A lot of retailers have rose-colored glasses on right now. And things are going to be good until they are not so good. We’re heading toward the end of a long, successful business cycle, based on forecasts we have seen. Many retailers won’t be ready for the change.