If Cash is King, Sales is the Kingmaker
As businesses reopen after enforced hibernation, there are mixed messages about how we’re all coping. I got my first haircut in the last few days after a sixteen week hiatus and I was curious about the new standard operating procedures. While the salon has a full diary for the next few weeks, the team is staggering along on a rotation basis across a seven-day week. There is no real spike in average weekly sales.
I also went into the city centre to check out the stores, cafes and bars. It was a mixed bag. A few stores told me that while footfall is good, some customers are reluctant to try on garments. A few bars seemed to be busy on the face of it but social distancing is certainly having an impact.
One thing is for certain. Very few businesses have re-opened to a massive spike in business that makes up for the loss in sales. Consumer confidence is low, uncertainty leads to caution and sales suffer. But after the lockdown, businesses need cash as quickly as possible. And that means the same thing for all of us, when cash is king sales are the kingmaker.
Now is the time to revisit the basic levers that will give you back control over your sales. Simply re-opening your doors (with the new guidelines) and hoping that customers come, is not enough. Whether you’re a B2B or B2C organisation, there is so much that you can do proactively to drive your own sales.
Think about all of those amazing and iconic companies that seem to thrive in all weathers. What is it that has made them all such powerful and successful organisations in their respective fields? What are their secrets to success? Well, they all have one thing in common and it’s not that difficult! They all follow a very structured sales strategy. And this is it below.
The Three Practical Levers to Drive Sales, for B2B and B2C businesses.
The fundamental sales levers for any business are locked in this simple formula.
F x C x A = Sales
- F: F is for ‘footfall’. If you are a B2C business with a physical business, this is the number of people who enter your premises. For professional services or B2Bs, you probably call them prospects or leads.
- C: We know that many customers are browsers and they don’t all purchase something straight away. There is so much you can do to influence ‘conversion’, which is the (C) in our model.
- A: Similarly, most businesses can also influence the ‘average transaction value’ for each customer, the (A) above in our model.
For example, imagine if you have 300 customers in a week (F) and 40% of them are converted (C) spending an average (A) of €50 each, that delivers sales (S) of €6,000. Given that footfall/leads may drop during the crisis, it doesn’t mean that your sales have to drop in the same proportion. There is so much that you can do to influence all three levers. These three levers act as signposts for a business to make considered decisions for increasing sales.
This model will guide you in crafting a solid roadmap for the short and the long term.
- Grow your footfall. Be clear on your target customers, so ‘go fishing where the fish are’. Social media is an excellent tool to enable you to focus your efforts and your spend. Don’t just sit on your settee at night time sending out random messages or ads on social.
But it’s not just about social media. Other traditional marketing streams are also effective, such as print, radio, TV advertising and PR. Your website should also be effective and uptodate. And don’t forget that events and promotions can also drive customers’ curiosity.
- Convert more browsers/prospects. Consider your product placement, whether it be in a physical space, your website or your brochures. Be mindful of how you present your product so that it is attractive and inspiring. Also, one of the biggest challenges for businesses the world over is to get their salespeople to sell and not just serve. For all of your customer-facing staff, they should follow three clear steps.
They should connect with your customers with a warm welcoming greeting. Encourage your people to consult your customers to get a true understanding of their needs so that they can closely match a product or solution. Conclude the interaction by making the customer feel good and appreciated.
- Increase your ATV. Give yourself and your people the skills to up-sell and aim to link-sell a second item to every customer. Perhaps consider some new incentives to motivate your teams to try even harder but make it fun and non-threatening.
Finally, ensure your salespeople have great product knowledge. When your team has a greater knowledge of the products, they will speak with more confidence about the product.
The Last Word
Over the last few weeks, I have interviewed countless businesses and given many webinars. I have shared the FCA=S outlined here many times and it offers clarity and hope in an uncertain world. I promise you that it will work for any commercial business. Here today I have focused on the skills and behaviours of your people. However there is much more to it than that.
I have now created an on-line course that goes into greater detail for each of the three levers. Supercharge your Sales is now available for free, on www.courses.kara.ie. Give it a try because I know that you too will get lots of ideas and reminders to help you to drive your sales.
Alan O’Neill is Managing Director of Kara, specialists in strategy, culture and people development. Go to www.kara.ie if you’d like help with your business.
Alan is author of “Premium is the New Black”.
© Copyright. Alan O’Neill. All rights reserved. 2020