|Residential Lighting: Why is it so hard to build showroom traffic?
Ethan Kap: The big-box retailers have been stealing customers. Many clients try to compete on the same level and don’t survive. So, we teach relationship selling. Stop the price competition and compete by focusing on personality marketing.
RL: Tell us about personality marketing.
EK: A lot of retailers brand their store or the brands in their store. We say, “You’re not Coke. You don’t have the budget to build a brand. Focus on building a personality. The brand should be you.” We help retailers build a solid foundation of steady customers, not so much through weekend blowout promotions, but through more reliable systems that produce traffic day in and day out. The idea is to grab the consumer’s attention through personal advertising.
RL: Do you advocate certain media?
EK: Diversity breeds stability. We want retailers to use every single method that they can track and will make them money. We have found, though, that TV and radio seem less effective today. Use of smart,
strategic, response-oriented marketing via direct mail and the Internet is more effective.
One of our members, for example, was sending out circulars and flyers. We helped him craft a powerful, personal four-page letter. Within a month he did more than $300,000 in sales and spent only $4,400. He told clients to bring in the letter to claim a premium, and he had more people in his store than he ever had in his 20-plus years in retailing.
RL: What’s the trick?
EK: You stay in front of your customer base through a sequential campaign. You send out one letter, talking to the customer as a person talks to another person. Then, a few weeks later, you send another letter that refers to the first. It’s in sequence, asking them to come into the
store. Two weeks later, for a third time, you do it again.
RL: Do your strategies increase the ad budget?
EK: They do cost money. But generally they don’t increase the ad budgets. Instead, we help cut the fat and waste from advertising, so that in most instances retailers spend less. Or, if they spend the same, they finally make money on that advertising dollar.
We teach something new to the home furnishings industry: continuity programs, where people pay monthly for a particular service. They’re an effective way to get a new revenue stream every month without having to acquire new clients. You get more revenue from your current clients.
RL: How do they work?
EK: Say it’s a monthly program with three tiers—gold, silver and platinum. For the gold membership, you charge their credit card $50 a month but send them a coupon for $55. You are sending out a coupon, but when customers come in to redeem their coupons, they spend much more than $55. What you have is a guaranteed customer base, and customers tend to stay in these programs.
Ethan Kap and Brett Kitchen—“The Traffic Guys”—operate Furniture Marketing Systems, LLC, Murray, UT, a marketing firm that consults with small-to medium-sized retailers. More information is available at www.explodestoretraffic.com .