Sunday, 18 August 2013

How to compete against online stores




A conversation between a walk-in customer in a shoe store and the sales man

"Good Morning Sir - How can I help?"
" Morning.. I am just looking for a trainer or gym shoes"
" Of-course, we have a few of them in stock. Take a look at this one."
"Wow..this looks cool... how much this is for ? "
" only 6000 INR sir ..and this is a shoe that can be used for gym as well as running"
" Ah I see... but isn't the running one designed to have frontal movement with the front side strong the gym shoes designed for lateral movements."
" Of-course sir... but you can use this for both the purpose."
"Well..that's well above my budget... what's the discount banner on your entrance all about"
" That's not applicable on the sport shoe sir"
"Well... thank you then"

The customer leaves the shop in less then 2 min.

A large portion of Indian customers ( and probably all the emerging markets) are becoming increasing aware of the product they buy. They do all their research before placing an order on online shops.

Only reason they go to walk-in shops is one of the following:-

- They want to to try the sizes and take first hand try/look on the appearance of product
- Immediate delivery
- Competitive price ( if any)
- Discount hoardings
- Trust salesperson for advise

Apart from these I can't think of any reason I would like to walk-in a franchise rather than place an online order. If you think of any other reason, please feel free to add in the comments below.

In our examples above, let's put the perspective from salesman and customer.


Sales man perspective:-
- Customer is wearing high-end sport shoes. He must be after a premium shoe.
-  Let me impress him with our latest collections.
-  He must be after a running cum training shoes


Customer perspective:-
-  I know the exact difference between training and running shoes.
- I will only go for an entry level training shoe around 2000INR. If I get a good option, I can stretch my budget to 2500 or even 3000INR.
- There were quite a few gym/training shoes in the range on the online shops ( like Flipkart, Jabong etc)
- There is discount hoarding on the shop. I might be able to get some good deals.
- But this sales person doesn't seem to know the difference between running and gym/training shoes.
- There is no point in browsing for other models and I don't think I will visit this shop again.

So the customer is well aware of the product he is after and is also well informed about the models and pricing available in the shops. He immediately gets switched off and leaves when he feels this is not the right place to shop.

What does customer do after leaving shop?
 He buys a 2500INR shoe online.

Although there are limitations on sales person front like
- Limited availability of shoe range
- pressure from store manager to direct the customer to latest arrivals and products with higher profit margin
- lack of training
- time constraint ( it's a weekend and he has to attend to many customers)

But still with a little bit of awareness, honesty and soft-skills , he might have been able to build a good rapport with customer.

Imagine the conversation happening this way:-

"Good Morning Sir. How can I help you today?"
"Morning, I am just after a gym/training shoe.."
"Great..thanks for showing you interest in Brand XYZ.  So do you go to gym for weight training sessions or just cardio or both?"
Customer is visible interested now. He didn't weigh this angle.
"Well..I do them both ...alternate days.."
"Then I guess you might be after a shoe that you should be able to serve you both the purpose.."
"I believe so... Yes.. or may be just for weight training..I do have running shoe.."
"We have both of them.. I can show you both if you want .. to help you decide"
"That would be nice..I would like to try a few "
"And any price range you are looking for...?"
"Anything around 2000..?"
"Apologies Sir, Brand XYZ does have training/gym shoes in that range but we don't have in stock currently..  all we have starts from 6000INR .. you may want to take a look at least..."
"Sure...I see... that's fine then.."
"Later, I will show you the catalogue and help you find your sizes.. If you like any of them in your price range, we will get them for you.. unless you have made your mind for any particular model"
"Yes... I know the model ABC that I saw online, it looked good and fits in my budget"


In the conversation above, the customer is impressed by the depth of salesperson knowledge and also reveals that he is after a particular model. He might not buy that day, but he can definitely end up placing a order from catalogue or can visit another day..


This article is first of it's series to help retailers competing directly with on-line stores. In next article, I will write about how to train your sales person to attend to different type of customers. Brand loyalty is fine, but what the shop or franchise owners should focus upon is shop loyalty.