Art of Retail Management: Women: smart, savvy, eager to spend...but frequently overlooked
A woman shopping in a floor covering store is spotted sorting through a rack of samples when a salesman approaches and offers some friendly advice: "I've got a cheaper one over here," says the well meaning salesman as he motions to an assortment of budget items. "You don't need to spend that much."
Maybe he can't comprehend spending that much but she can. Chances are she has a deep emotional attachment to her home and understands the value of investing in a quality floor covering. She knows that it is a sensible and practical way to add value to her home while at the same time enhancing the décor. For her, quality is a top priority. She should be that salesman's most valued customer.
Instead, she is pointed toward the discount rack.
This is why I often think the average bottom line price for a floor covering sale would be higher if the business was not run almost entirely by men. Remember, women make the purchase decisions.
It is clear that many of us in the floor covering business can do a better job of understanding that the industry's core consumer does not view our products as a commodity. Women tend to understand that a lasting addition to the home is not the time to pinch pennies.
I saw this first hand when my wife and I remodeled our kitchen. I was inclined to go with laminate countertops. They are adequate and nice. But my wife was set on more costly granite countertops. Granite was the trend and she would be the first to admit that her kitchen is emotionally important to her. We discussed the significant difference in price. I employed all my debating and communication skills but the bottom line is we now have beautiful granite counter tops. And, yes, the kitchen looks great.
My wife's influence in the final decision is consistent with what we see in a number of areas. Studies show women buy 94% of home furnishings, 80% of the products for do-it-yourself projects, 92% of the vacations and 83% of all consumer products.
As management guru Tom Peters puts it: "Women's purchasing power is the strongest and most dynamic force at work in the American economy today, even bigger than the Internet. Men and women are different, very different. Men and women have absolutely nothing in common. Women buy lots of stuff. Women buy all the stuff. The women's market is opportunity number one!"
So I encourage you to ask yourself: Are men working in our industry guilty of positioning flooring as a commodity purchase?
How well have you staged your showroom to resonate with your customers' emotions? How well are your salespeople trading your customers up to luxury? How often do you hear your salespeople croon, "Can you imagine how beautiful your room will look with this new floor covering and your accessories?"
Do you have any salespeople who sell on price? Does their pitch begin with "You've just got to see this beautiful new carpet!" Or, something along the lines of "Have I got a deal for you?"
Which is more common in your store? Salespeople who understand and use the emotional words and phrases of decorating and color or those who your customers' shopping experience as "uplifting" as selecting a sack of potatoes?
It's a good bet that your margins will rise after you consider your women customers' emotional needs and their desire to buy home products that offer an emotional lift. This is particularly true when your customers trade up to luxury.
Also, because the home tends to be emotionally important to the woman, it's a good bet that her future floor covering purchases will tend toward the high end. Indeed, research from the Boston Consulting Group, indicates a growing number of America's middle-market consumers are trading up to luxury. They are willingly to pay a sizeable premium for goods and services they believe will deliver extra value in their quality, performance, and emotional engagement. Simply put: They seek an emotional lift and they'll pay luxury prices in hopes of achieving it. Fortunately for us, the home lies well within the emotional realm - in fact, it's the leading category for trading-up.
While all this bodes well for our business, remember also that the big box home centers like Home Depot and Lowe's are also hustling to figure how to capture more of those anticipated dollars. Already, they're testing different retail formats to find out what works. They know their current flooring formats have to change in order for them to capture more market share. They also understand the key to the future is through better understanding the woman shopper.
Why is this happening? They recognize a woman's increasingly vital role both as a consumer and influencer of consumption. More women are working than ever before and the percentage of married couples with a wife working outside the home has doubled. Notably, 25% of working women earn more money than their husbands. Many women feel they should be able to spend a bit on themselves. And that includes spending on her home.
The woman consumer in your store today is more educated (50% of those over 25 have been to college), more sophisticated, better traveled, more adventurous, and more discerning than ever before. Well-traveled consumers seek the tastes and styles of foreign places and goods, to buy and enjoy in their homes.
So remember the good news: "home" ranks as the #1 category of "trading-up to luxury". The home embodies our identity, the physical expression of our heart and soul. Women, it seems, have a deep appreciation and understanding of this. When you remember that, you will stop sending her off to browse in the discount section.