February 14, 2019
Operations – Your Best Promotion
All retailers are trying to “sell more stuff.” In fact, this has become the recurring theme for a very well-attended meeting held each year in Phoenix. The issue is not what we want to do (sell more), but how to do so effectively?
Often times the way c-store retailers elect to sell more is by creating demand through promotions, which generally fall into two broad categories — image or item/price. With image promotions the theme is generally something based on creating a positive perception about the store. These promotions often tie into giveaways, sweepstakes games, etc. In general they cost a great deal of money and the impact can be difficult to measure.
Item/price is far simpler to measure and understand. You select items that you can buy at a discount from your suppliers, determine a price that you believe will attract customers and then communicate the offer to customers by building a display and external and internal signage. That being said, the goal of both types of promotion is to sell more.
Neither type of promotion will work if you haven’t promoted the biggest item in your inventory – the store. The bottom line is that unless the store is a place where people want to shop, it makes no difference which type of promotion you do, or if you do any at all.
It often said in our industry that “buy appeal is eye appeal.” When a customer is driving down the street does your store have eye appeal? Does it look like a place a customer would want to go into? We often work with retailers who are not making the money they want. Invariably, one of the underlying issues is that their store is not a place that invites people to shop.
A very basic truth is that if you don’t get people to try your store, you can never get them in the habit of shopping at your store. All the promotions in the world will not make up for a dirty parking lot, uncut grass, dirty floors, sloppy looking employees or half-filled shelves.
Because the operating changes required are generally low cost (but take lots of elbow grease) these are often the first of our recommendations the operators undertake. It’s difficult to sort out the impact that making these improvements have versus implementing the rest of the marketing/operations plan. We can state that the increases in traffic and sales are always higher in those stores that create the eye appeal than those that don’t.
The bottom line — the best promotion you can run is to have a store people want to shop and that isn’t achieved through marketing, but through good basic store operations.