Author / business

Takeaways from Consumer Changes in the Retail Sector

On March 6th, 2012 I had the pleasure of attending Deloitte’s Retail Outlook 2012, where they discussed “Store 3.0”.

In a quick summary, the role of the retail store in a consumer’s quest of a product is changing. Consumers used to come to a retail store to find products and learn from the salespeople. Today consumers go to a retail location merely to pick up a product they have already researched and reviewed online through consumer reports and feedback from social media. Indeed, many consumers come knowing more about product options than the sales teams know. This means retailers need to have an active and engaging social media presence. Furthermore, many consumers prefer to make purchases online if at all possible, meaning retailers also need a well designed website with e-commerce and mobile options. If consumers come to a store, they also come armed with ads and print outs of the best prices, which might not necessarily be accurate or up to date. What does this mean for the retailer?

While retailers already train their employees, product training will be even more important. Retail employees will likely need to have technology in their hands, like iPads, to keep up with consumer knowledge and their questions. Beyond product knowledge, employees will also require training to ensure they use the technology correctly. Combined, this training will allow salespeople to truly be brand ambassadors, providing knowledge that is equal to the educated consumer and helping build the image that all who work for the retailer are also experts in the field. Additionally, not only will they need to know how to use it, but they will need to be able to present quickly and effectively from it. This practice is already being adopted by the pharmaceutical and marketing industries. We are already delivering training on these skills and can certainly help your team. In addition to training the salespeople, you also need to ensure that your technical team is able to deploy, manage, and secure the mobile devices, which is another area that we are doing an increasing amount of training.

Beyond this, they also need to know how to communicate and manage consumer demands. Customers come armed with ads, giving them the power position and putting pressure on salespeople who don’t necessarily possess the skills to defend or respond effectively. This leads to a conflict situation where, if emotions are not properly managed, could escalate and the company may ultimately lose not only the individual client, but also their friends through the power of social media. How can sales teams diffuse the situation and make it into a positive experience?

There are a number of techniques that we can take from our SmartMANAGER course, but there are two I think are particularly useful. The first is PRAT – People Respond as Treated. An upset customer will most likely adopt a stance of an Angry Child and/or Critical Parent ego states: confrontational, verbally abusive, single minded, aggressive. The sales individual’s first instinct is to respond in kind, being inflexible and responding with statements such as:

“You are wrong, it clearly states…”
“I’m telling you that…”

This situation can generally only escalate since people respond as treated (PRAT), and become a yelling match. Instead we need to  be able to turn the interaction into an Adult to Adult transaction. This is not easy especially as in the above scenario the individual is not in the power position and can be emotionally hooked by these statements. To do this, we need to “Stop and PI”, a technique covered in length in Day 3 of the course as two of the multiple steps involved. From them perhaps the most important for this situation is stopping, actively listening, and defining the objective.

The “Stop” principle essentially makes you think before you respond. This can be the difference between responding aggressively as an Angry Child and responding in a mature Adult manner. It is the first step to having a productive conversation that leads to your objective. Next is active listening, which is an action that is frequently talked about yet not applied. It requires a conscious commitment to listen to what the customer is saying. Customers need to recognize that you care about what they are saying. Using clarifying questions (i.e. “Which paper did you find this ad in?”) and connecting with the customer (i.e. “I hear your frustration about the ad being incorrect, I’d be upset too.”) will help lower the emotions and lays the ground work for defining the objective of the interaction. In the case of a customer showing up with an invalid ad, it is most likely human error. The ideal objectives will not be the same for both parties, however there is likely a middle ground. Stopping and listening gives everyone time to understand  their needs and provides alternate options should the discount or product they are looking for not be available.

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