October 14/21, 2019: Volume 35/Issue 8
By Jim Augustus Armstrong
(Second of two parts)
In part one of this series (FCNews, Sept. 16/23), I made the point that, hopefully, industry-wide solutions to the installer shortage are coming, but that might take a while. In the short term you’ve got to solve it for yourself, which generally means either hiring installers away from other retailers, or recruiting and training them yourself. Either way, if you don’t have enough customers and your margins are low, you’ll have trouble affording it.
That’s where good marketing comes in. Let’s look at some practical strategies you can implement to attract plenty of quality customers and command margins of 40%-50% or more.
Build a strong foundation. The first thing you need to have in place is a strong selling system. Studies show that on average three out of 10 walk-ins wind up buying. If you’re investing time, energy and money to get customers to walk in—but your sales process is so weak that 70% of them don’t buy—you’re simply throwing your money away. So, before you even begin investing in marketing you need to put a strong selling system in place. Your selling system should equip your team to take control of the sales process, create differentiation, position them as trusted advisors, command high margins and close more sales.
Implement a referral-generating system. Referrals are less price-resistant, easier to close and more fun to work with than cold prospects who simply saw an advertisement. We all know this, yet most dealers don’t have a system in place to generate ongoing referrals. Your referral system should do two things: First, train your team on how to ask for and get immediate referrals from your completed installations. Second, your system should generate ongoing referrals from customers between purchases. You do this by creating a culture of referrals.
Dance with the one who brought you. Your business exists because of the patronage of your past customers. Stop ignoring them. Communicate with them at least monthly. I’m going to keep hammering this until the industry gets the message.
Wow ’em from the get-go. Everyone goes online looking for flooring, and everyone reads reviews. That’s why it’s important to make sure you’ve got dozens of 4- and 5-star reviews, with new ones being added each month.
Profit from other people’s herds.Over the years you’ve been in business you’ve rounded up a herd of past customers who provide you with repeat and referred business. Other businesses have too. Build referral relationships with these businesses. Top prospects include realtors, remodelers and designers.
The strategies I’ve presented have something in common: they all help increase your repeat and referred business, close more sales and position your store as the obvious choice. When you shift from being, say, 30% repeat/referral-driven, to being 70% repeat/referral-driven, your closed sales will automatically increase and it will be far easier to command high margins. And this will help you solve the installation crisis for your own business more effectively and less expensively than many other kinds of advertising.
Jim Augustus Armstrong is the founder and president of Flooring Success Systems, a company that provides floor dealers with marketing services and coaching to help them attract quality customers, close more sales, get higher margins and work the hours they choose. Visit FlooringSuccessSystems.com for more information.