A Tale of Two Products - Do You Know What Makes Your Products Sell?

'It was the best of times, it was the worst of times.'

Sally's store sells widgets and woggles. She thought they would both be hot sellers.

Widgets sold like hotcakes. Woggles languished on the shelves. Store sales have not met projections.

What should Sally do? Slash prices on the woggles? Get more widgets?

The lower price will devalue the woggles in the customers' eyes, attracting just the discount shoppers. And slashing prices will cut into margins, making a rough time even rougher.

It could be a necessary tough call, but how can she tell?

The truth is, Sally doesn't know. She doesn't have enough information.

To look ahead, first look back.

Sally needs to look back and find out why the woggles didn't sell. Just as important, she needs to find out why the widgets sold so well.

Again, Sally could go with the easy answers.

Customers liked the widgets. They didn't like the woggles. Sales were down because of low customer confidence. Shoppers were tightening their belts. They only bought one item instead of two.

Sounds good. Sally doesn't have to think too much. There's only one problem.

Those answers are false. Or, could be false, but Sally isn't sure.

Uncovering the truth.

Sally decided to sit down and make a list of all the possible reasons the widgets outsold the woggles. Here's what she came up with:

1. Customer needs or preferences

2. Product problem - quality, design

3. Merchandising effectiveness

4. Pricing problem

5. Sales team effectiveness

6. Product knowledge & communication

7. External issues - economy, competitors

Sally has some work to do. She goes out on her sales floor.

Sally starts talking. Talking to the sales staff. 'What have customers been saying about the widgets and woggles? What do they like?'

She talks to the customers. 'What do you think of these products? How much would you be willing to pay for a product like this?'

Sally takes the products home. She tries them out. She gets her family to try them out. She tells her staff how much she liked them. She encourages them to try them out and tell her what they think.

Sally posts a sign by the cash register. 'Staff pick: Woggles' She watches for changes in sales.

Next week, she changes the sign. Now it reads, 'Woggles: Favorite of Jack, age 5.' She keeps track of which sign performs better.

Sally reviews her merchandising. Where were the woggles positioned? Where were widgets positioned? Sally reverses them.

A new display is created at the front of the store. Sally adds a sign: 'Woggles: a must-have accessory for your widget.'

Sally calls a staff meeting. She trains the sales team about the benefits of the woggles. She adds product information to the woggle shelf tags.

Woggle sales begin to go up. Slow at first, but gradually climbing.

Sally takes a break.

On her break, she reads the paper. She learns that the retail sales are slow this season.

Sally stretches, gets up and takes a walk. She browses through stores in her area. She notices that a competitor has a product similar to the woggle for sale.

She smiles, and goes back to her store. Sally starts planning how she will keep improving her sales of widgets and woggles.

More than widgets and woggles.

Of course, your store is much more complicated. More products. More issues.

It all boils down to the same three steps:

1. Look back

Honestly review past performance. Read department sales reports. Product reports. Most businesses generate a lot of information. Look at the trends.

2. Ask questions

Ask yourself what influenced, or may have influenced, past performance. Talk to your team. Talk to customers. Test your assumptions.

3. Look ahead

Set new goals. Make a plan of action. A multi-faceted plan. Address all the opportunities you have to influence sales, not just the most obvious. Think of merchandising, signage, product information, pricing, training.

Many small changes can make a big difference!