This is the first in a series of articles by Jeff Giagnocavo and Ben McClure the authors of Mega Mattress Margins and co-owners of Gardner’s Mattress and More located in Lancaster, PA. In this and future issues Jeff and Ben will share techniques they’ve used to increase mattress sales and margins.
Do you ever receive faxes from your financing company offering promotional periods of financing at discounted rates?
At Gardner’s Mattress & More we turn these offers into profitable events. In this article, I am going to take you on a pretty deep dig of how you can also create events starting with these everyday financing offers to drive business into your store.
If you decide to do a promotion such as this, your goal will be twofold. You will want to increase your average sale by attaching items that customers would not normally purchase. You will also work to get customers to visit your store based on a "no money down, no interest for 50 months offer."
The Bedding Offer
Last October we used a “50 Months No Interest Offer” that Wells Fargo developed to celebrate their 50th anniversary of offering consumer financing to create a “Sign, Sleep, Dream” event.
The breakdown on this financing offer was a steep 11% discount rate, so we had to find a way to build into our promotion a way to cover that cost.
Our solution was to create an accessory promotion to attach to each sale that essentially covered the cost of financing plus returned a 20% margin on the accessories (see Chart 1 ).
For those of you who are reluctant to offer long-term financing due to the cost, you will be interested in our experience. We found that 80% of the people who responded to our offer settled on the upper end package as shown. Regardless of purchase price of their mattress, they all wanted to add on premium accessories when it was only $15 a month extra.
Attracting Mattress Customers
Last October there were no vendor events going on and we weren’t happy to just sit back and hope the door would open. That’s how the Sign, Sleep, Dream event was born.
The event was promoted via email to a house list of contacts from “Our World”. What is meant by “Our World”? These are customers who previously visited our store but haven’t yet bought. Because contact information for these shoppers is collected, we are able to continue to market to them. And, these are people who have downloaded our book, entered our contests, or submitted their names, addresses, etc., via mail for information to be sent to them.
We also promoted the Sign, Sleep, Dream event in all of our newspaper ads plus followed up the emails with a three drop postcard campaign to “Our World” contacts.
To make the process of collecting information and promoting easier, we’ve created a CRM software package so all of this is done automatically, no licking stamps, no typing out singular emails. It is very powerful.
You may be asking why we email and mail? Simple, how many emails did you delete today? And, how many emails did you delete, that you didn’t read, from people you know? My guess is a few too many. And those are from people you know and care about.
We aren’t so foolish as to think that just because we had a nice conversation with a prospect, we can rely on our clients saying, “Those Gardner’s guys sent me an email. Let me put down my lunch and call them right back with my credit card!”
No, it takes more. In a time where we are subjected to upwards of 5000 advertisements daily (DM News July 2013), it takes more to corral the attention of a prospect, especially if you are selling to their need as op-posed their want.
We’ve found that it’s important to include deadline dates with our offers (see the example below) that list deadline dates and a sliding scale of discounts on accessory packages. This creates an incentive for customers not to wait until the end of the event period to respond.
Let’s face it, without a deadline much in this world simply does not get done. So why did we choose not to offer discounts on the mattresses? Well first, we have more margin to play with on accessories than we do the main product, but second we are telling the customer that there are accessories to purchase, and they are in fact required to qualify for the “50 Months No Interest, No Money Down Sign Sleep Dream” event.
What Happens Next
The next step is to make sure that sales associates know what should happen when a customer walks in, and how to present sale packages offered with the Sign, Sleep, Dream event financing offer (monthly payment amount with accessory package included) to customers once they have shown an interest in this promotion.
So, your staff needs to be trained to professionally present your mattresses, accessories and the promotion, but more is required. In order to move the client from a need to a want mentality you must provide a singular in-store experience. You must think about and control how they experience you, your store, and your products.
At Gardner’s we sell the same mattresses that most others do. But how we attach and sell at higher ticket prices is what separates us from the rest.
We make sure that what customers experience the minute they walk in our door is different. It’s in how we greet them, how our store looks and the questions we ask.
We don’t barrage them with information they don’t care about like coil counts and foam densities. And, unlike most other stores, we are OK with them walking. That’s because a robust follow up CRM mechanism releases the pressure (we feel and they feel) so we can relax with them and they can actually relax with us.
Now some inside baseball here. Our experience is that if we are able to book a Dream Room appointment with a customer responding to a promotion such as our “Sign, Sleep, Dream” event, we know they will buy 100 percent of the time even if they don’t buy that day. A Dream Room appointment is a private mattress testing room designed to allow our customers to have a unique opportunity to “try before they buy” any mattress in a no-pressure, quiet environment.
We have yet to have someone not buy using the Dream Room. It may not be that day, but at last count the longest time lapsed between a presentation and a sale was three weeks.
That’s because even if we don’t sell them a mattress set today, we do sell them the benefits of buying from our store. In essence, we reframe their initial mindset that is, “who will I buy from?” to, “what will I buy from Gardner’s?”
So what about those who respond to a promotion, but do not book a Dream Room appointment? And honestly, there are more of these than there are Dream Room appointments. Well, we are moving them forward in the sale too. By collecting their contact information for proper follow up that is both systematic and automatic, we begin the process of moving them toward doing business with us.
Certain customers, those that come to us via road signs and word of mouth, leave with our book and testimonial “fanbook.” Price shoppers, who usually come to us without being referred or having done prior business, leave with our Ben Buck coupons and a shopping checklist.
And those that come to us with rave reviews are often booked into the Dream Room, but if not, they leave with a very specific sleep assessment describing the best fit to their own individual sleep needs.
Today’s customers command your attention, they need to know you want to earn their business and value it. The days of a one size fits all mattress are long gone, why sell and promote with a one size fits all approach?
About Jeff Giagnocavo: Jeff Giagnocavo is co-owner of the retailer Gardner’s Mattress & More and the co-creator of Mattress Retailer Weekly. Mattress Retailer Weekly is shared with you every week so you can get new customers, stay ahead of your competition and increase your sales tickets. Get your FREE subscription by visiting www.RenegadeMattressRetailer.com or text MRW to 484-303-4300.