Take a closer look. What
have you done to simplify your customer's decision-making process? Have you
taken steps to prevent an overload of stimuli from chasing them out of your
showroom? Merchandising systems like this one from Mohawk Industries can make
it easier to shop. Here, retailers at a recent floor covering trade show
examine samples of the company's carpet.
You have probably seen it countless times: The deer-in-the-headlights look customers get as they enter your showroom. They seem astonished by the seemingly endless displays of flooring samples. We sometimes forget that customers find the process of choosing a floor to be complex, confusing and even overwhelming. Confused customers suffer Cognitive Dissonance Disorder (CDD) and cannot buy.
Cognitive dissonance is a fancy way of saying the brain is overloaded with more stimuli than it can process. The brain cannot sort and select that much data. This explains why many shoppers “punt”- they leave your store, postpone buying flooring, and may even spend their money on something else.
Research from the WFCA and other groups confirms that most consumers find purchasing flooring confusing and not fun. In focus groups, women plead, “Simplify the process. Educate me, but don’t confuse me. I want to buy, but I don’t want to be sold. Appeal to my sense of style.” Did you know that most customers say they would prefer to shop without the help of a salesperson? Does your showroom allow customers to browse confidently without a salesperson?
What have you done to simplify your customers’ decision-making process and prevent this CDD overload? Ask customers how easy it is to shop your showroom. I have some recommendations to consider.
First, study how you display products. Are they grouped by manufacturer, category or style? Are your loop-pile Berbers inter-mixed with textures to keep one manufacturer’s products together? Or do you display all Berbers together? Ask yourself, “If I knew nothing about these products, how confidently could I select flooring by myself?”
From my visits in many stores, I find the best retailers merchandise by product category, not the manufacturer. They select categories that match either their consumers’ life styles or product styles. They also train salespeople to learn something about the customer before leading her to products. For example, they may ask “Tell me about the décor in your room. Is it casual or formal?” The answer to that question alone may disqualify half the products you sell but it spares her from product over-load. After a few friendly questions the salesperson can say, “Based on what you have shared with me, I think there are four or five products that may work for you. May I show them to you?” Think how relieved your customer feels: “This salesperson knows what I want. He has mentally sifted through all these flooring products and selected only those that suit my needs. Whew!”
But it is not just product-overload, there is also feature-overload. It too can trigger cognitive dissonance. Customers become confused by industry jargon or any thing they can’t readily comprehend. If you ask them, “Do you want a 50 or 60 ounce per sq. yd. carpet?” would she understand? My rule of thumb: Never tell the customer more than she needs to know to make a decision.
This is not to suggest you present only one sample to the customer. They want to buy; they don’t want to be sold. They “buy” when they choose between options. That’s why a wise salesperson presents four or five options across a range of price-points. This opportunity to compare products-when the choices are few enough to be understood-actually facilitates the customer’s ability to decide. Psychologically, customers want to compare and select by means of their own judgment. (It’s the very opposite of CDD which destroys the ability to decide.)
Customers especially like comparing apples to apples and oranges to oranges. But when there is no difference between one apple and another, the only issue is price. A salesperson who allows a customer to think that price is the only difference between two flooring samples is not a salesperson, but merely an order-taker. Your salespeople should never allow apples-to-apples comparisons. Rather, they should educate the customer about each sample’s distinct features, so she can compare all points of value, not just price.
The challenge then becomes how to educate customers without overwhelming them. In one study, researchers offered people a choice between a Cross pen (which costs $30, but did not show the price) and a 5-dollar bill. “You can have one or the other. Which would you choose?” (If I gave you the choice, which would you choose?) Some 80% of the customers picked the 5-dollar bill. Then, the researches laid down a third choice: a cheap plastic pen. When asked again which they would choose, 80% chose the Cross pen. Why the switch? They recognized the value of the Cross pen only after it was set next to a plastic pen.
How can you train your sales staff to this principle and help customers understand value? First, be sure they understand that customers cannot perceive most value differences between two flooring samples by just looking at them (as the people in the experiment did by looking as a Cross pen and a plastic pen.) Flooring salespeople must vividly describe the features that set one sample apart from another. The challenge for sales people is to create value in the consumer’s mind.
Second, teach your salespeople about the four categories of products: promotional products, specialty products, go-to products and decision-enhancing products. (Of course, you do not label them as such on the floor.) You want to segregate products into these four categories because: 1) they enable salespeople to enhance their customers’ ability to select the best flooring; and 2) you want to set different margins for each category. It is not a good idea to use one margin for all products. Even the big discount stores, known for low prices, do not sell every product at the same low margin. Let's take a closer look at what these producs types do:
Promotional Products drive traffic to your store. Advertise them without installation costs, so you can promote the lowest price. They give customers the impression you are very competitive.
Specialty Products are unusual or one-of-a-kind.They are not margin sensitive, so you can set a higher margin. (If a customer strongly wants one, she will pay the price.) If many competitors are selling this product and it is popular, you may also turn it into a promotional product.
Go-to Products are your bread and butter products, your “horses,” because they are favored by your salespeople and most shoppers. Typically, these products comprise only 20% of your products, yet produce 80% of your results. Set a healthy margin, but not a high one.
Decision-Enhancing Products may be products you display that no customer has ever bought.You needn’t take them off the floor, when they can serve an important purpose. One sub-group of these products comprises high-end flooring with luxurious features. Price them at a high margin. (It doesn’t matter how high, you don’t sell them anyway.) The second sub-group comprises products that are less desirable in terms of color, durability, or fashion, although not necessarily the least expensive. (These are not inventoried.)
When you set both groups of decision-enhancing products next to your go-to products, salespeople can convincingly contrast the value in the go-to products. Thus, decision-enhancing products prevent cognitive dissonance and actually help customers make decisions. (This proximity of products is part of merchandising.)
As you merchandise your store, use these proven basic tactics. Decrease margins on price-sensitive items and increase them on non-sensitive products. Use square-foot pricing on all products, to facilitate price comparisons for different types of flooring, such as wood vs. carpet or ceramic vs. vinyl. Eliminate 95 cent and 99 cent pricing; instead use a seven or three as the last digit (as in $1.43/sq. ft.). These digits give customers the impression that you have lowered the price as far as possible, instead of rounding up to $1.49. Also, mark every product. Women customers do not trust stores where some products are not marked. Pricing helps them start shopping without a salesperson.
And use printed price tags. Hand-written tags imply that you have set the prices casually, so they are negotiable. Price your go-to products to include the cost of cushion and installation labor, where possible. Women shoppers hate hidden charges and extras later added. It’s easier to go down, than to sell up. On the price tag, show the “by the month” price. “You can have 1000 sq. ft. of this carpet for $39 a month.” Take the focus off the total price.
Do you have a bargain area? I recommend it. Customers love to compare bargains to your other products. Just limit the choices.
The joy of selling flooring, for me, is knowing that when I use these proven merchandising principles I am helping a customer choose the flooring she really wants in her home or office. My motive is not to deceive her, but to help her choose what she will feel good about for years to come. I know she will be better served by buying from me, so I work hard to make the best presentation I can to her. I want her to be happy and I want to like the person I see in the bathroom mirror every morning. How about you?
