Knock-off Branding

Let me say at the outset, that I am a fan of the underdog. Microsoft is the underdog in the consumer world. I first wrote about them when I visited their very first store in AZ. That post and its observations was one of the highest read posts in this blog. It just goes to show you that Microsoft is still a big and powerful brand name. 

Last week, I was in Austin and go the chance to be at the grand opening of the Microsoft store in the Domain. At first glance, there was a line of people waiting to get inside - good sign. This means there is some excitement about the store. At second glance, I realized that the vast majority of people in the line had Dell employee badges hanging from their belts. (so in case you had some delays calling in that day, they were all at the Microsoft retail store) 

As you stroll through the store you can see some of the "upgrades" from the original. And I would say that the store is looking much more appealing. However, look at the picture of the outside of the store

Seem familiar? Glass, sleek, one-color front with an emblem versus a name. Tables inside with light colored woods. Getting the picture? There is a store in Dallas, TX that sells purses. They look like Gucci, Prada, Coach, etc, but they are not. When you go to the counter to pay, they will get a brand name plate out from under the router and stick it onto the bag and wallah - you now have a Kate Spade purse for $20. 

I cannot shake the feeling of the Microsoft store as being exactly the same as the handbag. Why would they put so much effort into being a "knock-off" of Apple versus being their own brand with their own identity with their own personality? Do they honestly believe people will wonder into their store thinking its Apple? 

The problem is that instead of this store looking like a beaming representation of the brand, it looks like an imitation of something they would like to be. Again, I want Microsoft to succeed. But, they just seem to place more value in being Apple than they do in being themselves. And what are we customers left to think about them? you can get stuff that looks like Apple, but not quite as real? I know that cannot be what they were thinking. 

Remember, Everything Speaks. And this store design is screaming - we wish we were Apple. 

And the irony is that as soon as the Microsoft retail store opened, the Apple store - a few doors down the row - closed for remodeling. Wonder what they have in store? 

"Modeling" in Retail

No matter how terrific your sales process is, the ability to execute on that process is the key to your success. And your ability to teach and coach your sales professionals is paramount. You cannot rely on "training" to get the job done. Too many managers operate off of the principle that "they went through the training, so they know what to do." 

Right away, there is a big problem with this. First, studies show that we forget about 1/2 of what we have been told in training within the first hour? And after a week, that drops to about 25% of what was in the training class. For most of you, you probably have no problem accepting those stats as true from your own personal experiences. But the fact of the matter is that without your follow-up as a sales coach, your chances of success are also dropping by these %'s each week.

Its not that your sales processionals are lazy or don't care - its that they are adults. And the statistics in the last paragraph apply to all adults. But you can make a difference in your sales professionals' success by making a difference in their behaviors.

One of the biggest mistakes we see Managers make is this - when they are on the sales floor, they do not follow the sales process they train their people on! (Actually, the number one issue is probably that the managers don't even get on the sales floor or take an up anymore, but that is for another post.) The manager cuts corners, makes it up as he goes along and the sales professionals are watching every moment of this. And they are cataloguing it in their mind for the time when you comment on their sales performance.

Modeling the way is one of the key forms of leadership touted by all the great leadership gurus from Robert Greenleaf, to Jim Collins to Warren Bennis to Mary Kay to Jack Welch. All of these leaders have stated that their ability to "model" the right behavior for their employees was key to their leadership style.

"Ah, but I closed the sale," you say. So? If you believe this, you are basically saying that the only thing that matters is closing the sale. This is a very slippery slope that leads to many, many bad outcomes - not the least of which is for this type of "win at all costs" behavior to be woven into the fabric of your store or company's culture.

You set the tone. You model the way. Your employees are watching your every move. If you want them to follow your lead or do what you say, then you have to realize that Everything Speaks. And nothing speaks louder than your behaviors on the sales floor - especially in retail.

This means that your must follow the sales process at all times. It means that you must spend more time on the sales floor than you do currently. Yes you. We know its tough, especially for the small business owners. But we have been there. We have run our own stores and have had to fight the balance between managing the business and managing the people. But the bottom line is that sales professionals are not born - they are "modeled." Which means that they are developed through having a structured sales process, taught through professional training, and coached by a "present" owner or manager on a weekly (daily) basis.

What gets rewarded gets repeated. When you are on the sales floor, you can reward their good behaviors. When you are not on the sales floor? Well, you are also rewarding them. As Ferdinand Fournies always said, "your non-action means as much as your action." Translation - if you let them do it however they want by not being present on a regular basis, then you are rewarding their behavior (albeit not intentionally.)

Modeling the way is one part of an overall strategy for coaching your sales professionals to their highest potential. But is the one way that can do the most good or the most harm to your team depending on what you are modeling. Makes you think twice about "closing the sale" any way you can. We all know that any process, any technique will work at least once - but what you need is a process and a technique that will work over and over and over. A retail sales process like the G.R.E.A.T. system of the Retail Sales Bible. Check it out.

Fair and Square

Okay, let me start by saying I believe this idea is never going to work. It violates the very principles that this blog preaches about in regards to corporate culture. First what is the new Fair and Square marketing plan from J.C. Penney?

J.C. Penney's new "fair and square" plan cuts prices by 40 percent from what they were a year ago. The idea was to get off the promotional treadmill, away from the steady stream of specials, coupons and "doorbusters" that drain retailers' profits. But they are still running sales. This undermines that strategy since sales aren't really going away. Each month, they select some items to discount further, and on the first and third Friday of each month, they hold "clearance" sales with even lower prices.

So do you see the issue here? The culture. If you want to transform the culture of your business to be one of fair and square pricing where there is no need for a sale, the first people you have to convince are the employees. And if you continue to run sales, then what are you reinforcing with your employees? Simply put - that fair and square is a marketing and advertising plan and not a real change in the corporate culture's values. They will buy in at first. There will be big meetings and fun internal marketing programs to "get the word out." But each time they run a sale, an employee knows that these prices are just different. Plus, they know that you cannot reduce your prices by 40% without changing the products. So they are left asking is this a better deal or cheaper goods?

Don't get me wrong, it will work for awhile. But the Culture Cycle (the cycle of how a corporate culture develops and sustains) will kick in and the new ideas brought forth with this concept will be swept away by the reality of the culture. The employee and the customer will not believe it.

Apple, where Ron Johnson now CEO of J.C. Penney came from knew this very well. And they performed it very well. They were models for how to align the employees with the culture. But, that was a "ground up." Process, In fact, Apple closed the first few stores they opened and started over again because the stores did not align with the corporate culture values.

Our friends who work at JCP have all shared that they are "confused" by fair and square and do not understand who it aligns with who JCP is and worse yet, do not know where JCP is going. JCP is an established company with an established culture that needs to be changed. The simple fact is that it is 100 times harder to change a culture than it is to start one.

There is a long road ahead of JCP. And, we hope that Wall Street gives them time to work it out. But learn the lesson here. You must program the future to accept this new value as a company. Otherwise, the culture will strip away every part of your plan.