Maximizing your share of the market
Often, the statistical information that you see in articles in trade publications is given to you utilizing a pie chart. For example, using a pie chart, the writer may show you the results of a survey taken to ask consumers where they shop. Many times, the pie chart is accompanied by a second pie chart that indicates how the pie was divided several years earlier. There are two changes that you will frequently observe when looking at the changes over a period of years. The first is to see which types of businesses have gained in percentage share as compared to those types of businesses that have lost a part of the market. The other change is that there are one or two new groups of retailers that now have entered the market and own a percentage of the overall trade.
When you look at the pie chart, think of that favorite pie that grandmother always made for you. It was very delicious, and she had baked it especially for you. Yes, grandmother did have a slice, and so did Mom and Dad. But, the majority of the pie was for you. Unfortunately, today you now have a little brother or sister, perhaps several, and now even the cousins are wanting to have a piece of your pie. Business today is much the same as grandmother's pie. It was, and still is, very desirable. But, a growing number of competitors think that what you sell is one of the best pies to be a part of.
Are these retailers your competitors? If a dollar that could be spent in your store is spent in another store, then you most definitely have a competitor. It does not matter why the other retailers have begun to offer what you have sold for years. The important question is, "What are you going to do about it?"
The number of potential customers has not increased as significantly as has the number of choices of places for the customer to shop. Fortunately for you, as the number of retailers increases, the focus of the competition has frequently been price. A study gives us reason to be excited. In a study of 20,000 consumers, the five greatest demands in order of importance were: have inventory on hand, save my time, sell value to me, have attractive visual merchandising, and have qualified help available.
Where is price in this equation? We do not know, but this survey does indicate that there are at least five more important things to the customer. Try taking this five step approach to increasing your market share. First, visit the competitors to see how they operate. How is their merchandise displayed? What product categories do they specialize in? Be knowledgeable of what they are doing and do take note of their prices.
Second, take special note of what they do not do. Do they have extended hours? What do they have a small selection of that you have a superior selection of? Do they offer additional services? What accessory items do they sell? In short, look for their weaknesses.
Thirdly, look for success stories of retailers not in your trade area. Trade magazines are an excellent place to start your search. Call or visit other businesses and ask for ideas that they have tried.
Your fourth step should be to establish a plan, schedule, and budget to implement any additions and changes to your business. You may be adding new products, a specialty selection, or just rearranging your sales floor. Are products grouped according to how a customer selects them or are they arranged according to some manufacturer’s plan-o-gram?
Regarding the usage and enjoyment of the products you sell, someone has to educate these customers. Don't you want it to be you?
The fifth step is to begin to promote. Note that promotion and advertising are definitely not the same thing. An example of an excellent promotion by a business is to find a non-profit organization and become an active part of their efforts. Research shows that customers change their opinion of a business in a positive manner because of the participation of the business in the community.
Grandmother’s pie was always delicious; that is why we wanted a bigger slice or a second helping. Your business should be the same way – looking for more.