Details determine success or failure, department stores have clever ways to turn losses into profits

Yang Shaohua invested 200,000 yuan to open a Fenghua Department Store on Xiushui Road. Although Xiushui Road is not a bustling street, it is adjacent to two large residential areas within the business district with a radius of 500 meters. There are several relatively small-scale enterprises with a relatively large flow of people. If you open a department store in such a place, business will naturally be good. But the good times did not last long. Since last year, several new convenience stores have been opened in Silk Street. The department store business has been getting worse and worse since then. In June last year, a large supermarket also opened a store with a business area of ????360 square meters in Silk Street. With a branch of 1,000 square meters, Yang Shaohua's business is even worse. Several small shops like his have closed down due to lack of business, and Yang Shaohua is very worried about this. He realized that if he did not change his business philosophy and continued along the same path, the department store would have to close sooner or later. But how can we attract customers?

1. Popularity determines success or failure

After observation, Yang Shaohua discovered that the reason why large supermarkets are so crowded with customers is that they always carry out promotions one after another, and many products are at special prices. sell. For example, Northeast high-quality rice only costs 2 yuan per kilogram, and fresh local eggs cost 0.2 yuan each. In other words, there is zero profit for supermarkets selling Northeastern rice and fresh eggs! Yang Shaohua thought to himself, the operating cost of a supermarket is much higher than that of an ordinary small store. Not only does it make no profit at this price, but it also has to pay labor costs. What is the reason for this?

It turns out that large supermarkets and shopping malls sell special products not for profit, but to attract customers at low prices. A small number of special offers can not only attract many customers, but also give customers the illusion that all the products here are cheaper than elsewhere, thus creating a desire to buy other products. Most customers will buy something else while buying special items, and this is the profit point of those large shopping malls and supermarkets. No wonder those merchants are always keen on special promotions.

After understanding the truth, Yang Shaohua also imitated the practices of large supermarkets and launched special promotions. He roughly counted the categories and quantities of all the products in the store, and came up with more than 20 kinds of small products as special promotional products. These promotional products accounted for about one-twentieth of all the products. Then, Yang Shaohua put up an eye-catching sign at the entrance of the store, which stated the types and promotional prices of the special products.

Yang Shaohua's move immediately aroused some people's discussion: What's wrong with this kid? Small shops as big as your palm are also following the big supermarkets in offering special promotions. Do they have the strength? It's really a dung beetle burrowing in the ground - looking for death (shit)! ?Yang Shaohua turned a deaf ear to other people's discussions and persuasion. He felt that people had a misunderstanding that only large supermarkets could engage in promotional activities. Not really. As long as you choose promotional products scientifically and formulate a reasonable promotion plan, you can still achieve good promotional results. Compared with large supermarkets and chain convenience stores, small stores can make decisions quickly and have flexible business strategies. As long as the promotion methods are appropriate and the publicity is right.

In order to make consumers feel that Yang Shaohua's special promotions are genuine, when choosing special products, he tries to choose products that are commonly used by people and have relatively transparent prices. Therefore, when customers walk into his store with hesitation, they will find that the special products here are really 20% to 30% cheaper than other stores. As a result, his business in those days was much hotter than usual, and his turnover was more than ten times that of before. Although many items were sold at zero profit, other items sold incidentally were several times the usual amount. In other words, his profits in those days were several times what he usually made.

After the first move was successful, Yang Shaohua resorted to the second move. He took advantage of the characteristics of a large number of children in the nearby community and launched a "birthday gift promotion", which lasted for two months. During the period, children under 15 years old can go to Fenghua Department Store to receive a birthday cake worth 50 yuan and a commemorative photo album with their birth certificate. Nowadays, children celebrate their birthdays very grandly and are willing to spend money. Therefore, most people will buy some food and drink when they go to receive the cake album. Needless to say, one cake and one album have made the shop very popular. Quite a few. What Yang Shaohua didn't expect was that because he sold more stuff and purchased more goods from wholesalers, there would be a greater discount on the wholesale price. Therefore, Yang Shaohua's operating costs have become lower; the merchandise turnover is faster, looks fresher than others, and is more attractive.

In this way, all links have entered a virtuous cycle.

Although Fenghua Department Store has emerged from the predicament, Yang Shaohua knows that the competition it faces will be more brutal. Whenever he has time, he is thinking about finding more ideas to attract and retain customers. There is a bus stop in front of Fenghua Department Store, and there are many people standing there waiting for the bus at any time. Sometimes after waiting for the bus for a long time, people who cannot stand for long, such as the elderly or pregnant women, will come to Yang Shaohua's store to borrow a stool. Or ask for a piece of cardboard to sit on for a while. Yang Shaohua discovered business opportunities from this. He asked someone to place a long row of plastic seats against the wall under the eaves of his store for people waiting to sit on the bus. He also set up a newspaper rack next to it. He bought several newspapers every day and placed them on the wall. Show it to customers there. Although this increased Yang Shaohua's additional expenses, it also increased the popularity of the store. While waiting for the bus, people often came to the store to buy cigarettes, water or snacks. Some people originally planned to go shopping in the supermarket, but saw that they were waiting here. It was convenient and the prices were similar to supermarkets, so I just bought them here. Needless to say, Yang Shaohua got a big deal for a small amount of money.

2. Positioning determines profits

Due to the prominent homogeneity of the products sold by department stores and little price difference, positioning has become a powerful tool for department stores to make profits. There are two large residential areas near Fenghua Department Store. There are also high-income residents in the community, so there is no problem with spending power. But there are also many ordinary citizens and laid-off workers here, who are very sensitive to commodity prices. In order to accurately position customers and adopt more effective management methods, Yang Shaohua analyzed the consumer psychology of customers at different levels.

Consumption behavior and psychological characteristics of high-income consumer groups: obvious brand preference, and are more affected by cultural appeals than price temptations. High-income groups are mostly "three high" consumer groups with high education, high taste and high consumption demand. They are easy to accept new things and big brands, and will develop corresponding brand preferences. They often spend thousands of dollars on a razor in order to pursue a "man's world". This group of people makes larger purchases in a single transaction, but makes less frequent purchases.

High-income groups are busy with work and show great irregularity in their lives. Except for weekends, shopping can only be a "luxury" for them. But shopping expectations are higher. High-income consumer groups are affected by their social status and expect merchants to give them special care when shopping.

Consumption behavior and psychological characteristics of low-income consumer groups: focus on price. Everyone has had the experience of being strapped for money. When you have no money, you always have to count every penny of your expenses. This is particularly true for low-income earners. Meeting as many consumer needs as possible with the least expenditure is their most "luxury" wish; they focus on quality.

The consumption habits of urban low-income people are different from those of rural consumers. They already have a sense of self-protection during consumption and the pursuit of healthy living and nutritious diet. Even if they buy bulk or unbranded products for the sake of frugality, they are still worried about the quality of the goods and are looking forward to the arrival of "shopping with confidence"; shopping in smaller quantities and more frequently. Low-income people, especially housewives, have a very regular life. They basically wake up on time, go to bed on time, buy things on time, and watch TV on time every day. Their single purchase amount is small, but their shopping frequency is high, and sometimes they purchase several times a day.

After the investigation is done, the next thing is to formulate an implementation plan. With only a business area of ??100 square meters and no strong financial strength, how should it face the two extreme consumer groups? According to the 80/20 law, 80% of Fenghua's profits come from the 20% of high-income groups, who are Yang Shaohua's "money counting machines". 80% of ordinary consumers only create 20% of his profits, but this 80% is the foundation for Yang Shaohua to gain a foothold in Xiushui Street, so in terms of business positioning, he must have both fish and cake.

After some thought, Yang Shaohua decided to distinguish between the extensive operation methods of supermarkets and convenience stores and adopt a composite positioning path based on characteristics and specializing in multiple functions, taking into account the needs of high-income customers. Humanistic expectations also provide low-income customers with assured "benefits" to meet the demand gaps of different consumer groups.

In the competitive stage of homogeneous products, same prices, and same promotions, department stores, which are between supermarkets and convenience stores, want to attract as many customers and sales profits as possible in a limited business district. , it is necessary to pave the way for the brand, follow up the culture, create a unique shopping concept and consumer culture, and create as much added value for customers as possible.

Based on the characteristics of high-income residents, Yang Shaohua set up a boutique area in the store, which displays various famous brand products, including razors worth thousands of yuan, lighters and handbags worth several hundred yuan each. Various famous cigarettes and wines, etc. In terms of operation, we should weaken prices and focus on services; focus on practical products, closely follow demand and take into account various forms. At the same time, a membership system is implemented that can provide them with consumer consultants, shopping information, door-to-door delivery, and year-end rewards.

For salarymen and laid-off workers, Yang Shaohua adopted a low-price strategy and opened special sales areas in department stores to sell general brands of daily chemicals, department stores and household consumables. We launch the "Daily Special Offers, Affordable and Free Free Shipping" activities to make ordinary consumers happy and confident when shopping.

And implement the "Hollyland" rebate plan: that is, launch the "Hollyland" shopping smart card to the general target consumer group. Every time you swipe your card to register for shopping, you will enjoy a certain percentage of rebates and lucky draw gifts at the end of the year, so as to cultivate and maintain customer loyalty.

3. Details determine customer sources

As a traditional department store, faced with the double squeeze of large supermarkets and convenience stores, homogeneous products and homogenization If you want to survive in the cracks of marketing methods, unique marketing details are the key to success or failure. From the beginning, Yang Shaohua positioned his store as "easy-to-use" and "friendly". After referring to the opinions of many friends, I believe that the key to business success lies in service quality: as a department store that distributes daily necessities, good service can shorten the direct distance with consumers from the beginning. As the saying goes: Everything depends on people. To have good service, you must first have good clerks. He strictly recruits employees with higher salaries and requires candidates to have store experience. Before taking up the job, he hired a full-time etiquette service coach to teach all employees (4) about basic sales etiquette, action language, counter promotion art, consumer psychology, and how to consult customers. months of training. After taking up the job, the employees were polite and courteous, leaving a good impression on customers.

In addition to improving the quality of shop assistants, Yang Shaohua also attaches great importance to creating a good shopping environment. Since the store is on the roadside and has a lot of dust, before opening the store every day, the inside and outside of the store must be thoroughly cleaned to make it spotless. .

Some people say that small department stores are not high-end and operators do not need to put much effort into displaying goods, but Yang Shaohua does not think so. He feels that the smaller the store, the more it should make good use of the space. The products should be arranged in an orderly manner so that customers can easily find the products they need after entering the store, saving time and effort. Such as children's food and toys. Many children who buy these things do so on a whim. They want them when they see them, but they don’t remember to buy them when they don’t see them. Therefore, in order to attract children, Yang Shaohua placed these fresh toys on the middle and lower floors of the shelves. That way, it's easy for kids to see and easy to pick up. After entering the store, no matter whether the adults bought it or not, the children rushed to hold one in their hands. Similarly, he also arranged the snacks that children like to eat in this way, and they sold well. It can be seen that whether it is a large supermarket or a small department store, product placement is always an important means to attract consumers to shop.

As the saying goes: "If the goods are not complete, you will not make money." When running a small department store, the most important thing is to have all the goods. In addition to large daily necessities, Yang Shaohua's department store also ensures sufficient supply of small commodities such as mosquito coils, sewing kits, and flashlights at all times, because these inconspicuous little things can often solve customers' urgent needs. Although these products only make a small profit, they can win word-of-mouth among surrounding consumer groups and bring popularity. Only when the goods are complete and customers have a wide range of choices can they be satisfied. Therefore, when operating a small department store close to the community, you must not ignore those small commodities. Only by relying on them to attract customers can you maintain a long-term business.

After several years of business, Yang Shaohua has also understood some consumer psychology. For example, when people are shopping, they often have the illusion that odd numbers are smaller than even numbers, and decimal points are smaller than integers. He used a fractional price strategy for the goods in his store. For example, for a product worth 1 yuan, he sets the price at 0.98 yuan. Although it is only 2 cents cheaper, it makes consumers feel that they are getting a bargain.

In daily operations, Yang Shaohua also learned to let himself suffer a loss, and he did not haggle with customers when collecting payments. Some inconspicuous small changes are simply discarded, giving customers the psychological pleasure of getting a bargain. Of course, although he won't take the change, he will definitely make it clear to the customer. Let the customer know that you owe him a favor, thereby creating a feeling of gratitude, and the chance of buying again in the future will be high.

Yang Shaohua also has a rigid rule for store clerks. If a customer purchases a lot, the clerk must help the customer carry it to his home within a distance of 100 meters. If the distance exceeds 100 meters, he must help the customer carry it into the car.

It is such "details" that have made Yang Shaohua's career a small shop as big as a palm. For most people, this is just a small business that can make a living. The reason why Yang Shaohua is able to make a prosperous business, making money every day, with annual profits and taxes exceeding one million, which even the big supermarkets next to him feels inferior to, is because he is constantly thinking about business and actively learns from convenience stores and convenience stores. Based on the successful experience of large supermarkets, and based on the actual situation of their own stores, they launched unique business strategies and constantly sought innovation and changes, thus achieving greater success.