By Bill Scott, President, StoreReport LLC
In September of 2010, nearly six years ago, Convenience Store Supply Chain Management was launched. In less than six years we have grown from one member to 15,777 members (as of this writing). If each of our members owned a convenience store, we might be considered the largest chain of convenience stores in the world.
Last week, I had a meeting with a couple of great guys who are invested in the convenience store industry, and just as I suspected, convenience stores in America share identical issues, and most can be solved starting with the proper management of inventory. All c-stores, no matter how large or small, continue to be hampered by twice the inventory needed to meet customer service level, and that adds up to about $4.5 Billion in non-producing stock nationwide.
If every item in convenience stores is supposed to be creating a profit, or causing other items to produce a profit, the current situation reminds me of an assembly line with half of the workers on break. Adding to that, the costs involved in running the stores, including salaries, insurance, employee theft and competition… it’s a wonder that any serious investor would have anything to do with them.
Convenience store operators are obviously spending a great deal of time searching the Internet for advice and ideas to increase sales and profits, as well as ideas on how to solve employee issues and inventory concerns. They are coming at the problem from every angle possible. Should I put in a food service? Should I open more stores, or shut some down? Should I increase wages or lay off workers? Why is it so hard to compete? And of course the most popular questions: How do I get into this business? Where do I get financing? How do I get started?
What comes first, the chicken or the egg?
Nothing can be substituted for a business plan. Starting any kind of enterprise without one is like going hunting in the dark. If you fire enough bullets you are bound to kill something, and hopefully it will be something you can eat. But thousands of people start businesses every day with the goal of making enough money to pay for dinner, and eight out of 10 of them run out of bullets and starve.
Social Media is a tool to both promote your business properly and solve your business problems, but if it’s not used properly you won’t get either. The question is, how do you do it?
How did we do it?
Of course, we could not have been successful without the help and encouragement of others. Notwithstanding the participation we have received from our dedicated members and fellow administrators, it would be unfair if I failed to mention the advice and the inspiration I received from the many Internet gurus who taught me by example, the true secrets of Social Media Branding.
Why is this significant?
It’s important because very few companies and organizations are making the best use of the world’s most powerful, and the most effective tools for branding. Branding is NOT the same as advertising, and confusing the two actions can lead to a fatal mistake. If I was pressed to find a correlation between branding and traditional advertising, it would fall more in line with a specific form of advertising better known as “institutional advertising.”
In this type of promotion, the buyer is rarely persuaded to take immediate action, but is gently acclimated over time to take a favorable position toward the company being promoted. In this situation, asking the customer to buy, visit, vote or participate, spoils the intent of the program entirely. In order for institutional advertising to be effective, great care must be taken to ensure the consumer does not have the sense that he or she is being solicited. Keeping this in the forefront of your thoughts, remember the adage, ‘No one wants to be sold, but everyone LOVES to buy.’
Before the introduction of the World Wide Web, I worked for 20 years in the advertising industry, first promoting a ragtag group of musicians in the 60s, trying to emulate entertainment icons such as Elvis Presley, Frankie Avalon, Jerry Lee Louis, James Brown, Wilson Pickett and BB King, which led to a string of careers in radio advertising, television, newspapers, Yellow Pages, two advertising companies and marketing my own software in the late 70s and continuing through to this very day.
During that time, the emphasis on advertising was all about, “What I am selling is great, and that’s why you need to give me your money,” or “Will you visit my store,” or “Will you vote for me in the next election.” Secondary emphasis was given to, “I want to work hard to help you succeed in your business,” “How can I make your life easier,” and “WHAT CAN I DO FOR YOU.”
There is a thin line between wanting to give something of value and wanting to make a sale, and the customer’s SCAM meter is highly sensitized to pick up on the subtle difference. Enthusiasm is usually a good thing, but too much enthusiasm can end in a disastrous failure if you do not identify and/or address the obstacles along the way, and one of the worst mistakes you can make is turning off your potential customer before you have a chance to get him or her to have a favorable impression of you and your business.
Every sales person knows that people will not generally buy from someone they dislike. But in their enthusiasm they go straight for the sale and wonder why they are met with resistance. I once observed a young, inexperienced salesperson criticize a potential customer for not paying attention to what he was saying. And by the way, I got thrown out of that customer’s office and warned never to come back. Yes, it was me, and I am not proud about it. In every sales situation, you’ll make more sales if you engage the customer in something that interest them first. Shortly, I’ll share with you a real-life example that will help to drive this point home. If the sales pitch occurs too quickly, you may very well lose the sale and waste your customer’s valuable time, not to mention your own time.
In America, avoiding advertising has evolved into an art form, evidenced by blocking popups on web sites, fast-forwarding through television commercials, diverting email to spam folders, sorting through snail-mail and throwing half of it into the trash bin without opening them, and cursing out telemarketers. Years of failed promises, intrusions into our private lives and outright lies have poisoned the platform of advertising and made the ‘informed’ public cynical. This partially explains why Millennials may be more gullible to advertising than the older generations, because they have experienced fewer disappointments than we have. It also explains why we tend to spend more effort advertising to this group. They will learn, just as the rest of us have learned, to “beware of the sales pitch.”
Tara Hunt, author of “The Power of Social Networking” got it right when she labeled our new century as the era of the ‘Social Capitalist.’ In this new world of advertising, we must come to understand that “Let me do something for you?” is the key to successful marketing on the Internet. “Can I entertain you,” and “Can I tell you of my experiences,” resonate in areas that is rarely affected by today’s sales efforts. In fact, making shallow promises and tempting customers to spend their money with you is one of the reasons most fledgling businesses fail today. We tend to ‘over promise’ to get results, and this leads to negative experiences for the customer.
In the World Wide Web, you have to tell people who you are and why you deserve to have their attention before you even think about discussing money.
(To be continued…)