by David McMahon, PerformNow
Retailers want to know how to get better results when traffic is slow. The best way is to replace an
‘Product Mindset’
with a ‘Project Mindset.’ Here’s how.
Furniture retailers across many regions in the U.S., Canada and abroad are concerned about the impact of
sluggish
in-store traffic. Many report average or declining sales and profitability. However, some are beating prior
years’
results, and others are setting and pursuing record-level goals. So why are some businesses prospering in the
current
environment while others are hurting?
Retail Selling Equation
Let's consider the retail selling equation with its three elements: in-store traffic, close rate and average sale
(calculated as in-store traffic × close rate × average sale). Underperforming retailers almost universally blame
economic conditions and slow traffic for their woes. They feel like victims.
In-store traffic is seen as being non-controllable by most industry salespeople and the main reason for declining
sales.
Making matters worse for many operations is that the other two elements of the selling equation, close rate and
average
sales, have been historically difficult to improve.
There is, however, a solution. Retailers that cultivate a "Project Mindset" are able to improve all three
elements of
the sales equation and to enjoy more control over their situations than their industry peers.
The Project Mindset
How can a mindset possibly accomplish better sales and profitability? First, consider the common way of doing
business:
the “Product Mindset.” In companies where management has a product mindset, the sales goal for each RSA is to
find and
sell the item that best meets a customer's need. Once accomplished, RSAs then move on to the next shopper, and
the
process starts again. The best furniture salespeople in our industry are great at matching items with customer
needs,
achieving high close rates and writing $1 million to $2 million in sales per year. To do this, however, requires
a
steady flow of customers walking through the front door, which is difficult to achieve right now. Another
problem for
retailers that have a product mindset is that salespeople who have average or below-average sales skills achieve
lower
close rates and thus “burn” more of the precious traffic that they get.
“How can a mindset possibly accomplish better profitability? First, consider the more
common and persistent 'Product Mindset.'”
The Product Mindset
Traditionally, retailers have sold room packages instead of items to build tickets. An even better strategy is
the
project mindset, a big-picture approach to meeting customers’ needs. Working on projects is a higher-level sales
practice than selling room packages or items. Projects get inside customers’ minds regarding their lifestyles,
uses, and
home living and are more likely to result in long-standing relationships and sales over time.
Unlike a product mindset, a project mindset improves all the elements of the selling equation. Here is how:
In-store Traffic: The project mindset empowers salespeople to generate their own customer
traffic. This reduces the need
for increased advertising expenditures, (which may produce diminishing returns when fewer people are actively in
the
market to buy). It also leads to better customer experiences via better understanding of customers' situations
and
needs.
Close Rate: Focusing on getting be-backs creates additional traffic. Return customers have a
greater than 60% chance of
buying, while for new, previously unknown customers, it’s about 25%. Thus, if more be-backs are produced from
the
on-average 75% of new customers who did not initially buy, overall close rates increase.
Average Sale: Customers who purchase single items have the lowest ticket size. Those who buy
complete rooms have triple
or more than that average sale. Project customers have even more tickets, with greater consistency and
repetition over
time, resulting in a maximized average sale per customer.
“The best furniture salespeople are great at matching items with customer needs. To do this, however,
requires a steady
flow of customers, which is difficult to achieve right now.”
Tools & Practices
Many tools and practices can help promote a project mindset.
-
Leadership and Management. Improving selling processes requires strong leaders who are
capable of innovating and
motivating people to push organization-wide change. Relentless implementation via consistent daily
actions is a
prerequisite. One leader recently told me she didn’t allow salespeople to complain about slow traffic
because it’s a
victim mindset. She believes salespeople are responsible for improving their sales by providing customer
experiences
that produce traffic. This type of leadership separates excellent retailers from all the others.
-
Selling Process. Treat every customer as a potential project customer. Avoid judging
customers on their ability to buy
or their desire for a more complete lifestyle solution. A project-minded retailer owner recently shared
a story with me
about a shopper who visited two competitive stores before being properly served. A new customer visited
his store,
engaged with a salesperson and asked her if the store sold fabric pillows. The salesperson replied that
they did, then
spent time getting to understand this customer’s complete situation. She found that the shopper was
renovating her home
and was looking for pillows to hide the worn cushions of an older sofa. To keep this story short, the
homeowner ended up
refurnishing her entire home over the following year, one room at a time. The customer explained that
she was
underserved by salespeople at other stores who didn’t listen to her and thought that she “didn’t know
what she wanted.”
Asking thoughtful questions and practicing engaged listening are noticeable practices in stores that
embrace project
mindsets. They encourage collaborative approaches between customers and salespeople. Instead of
presenting a product and
a price, salespeople use thoughtful questioning and visualization to actively explore solutions that
provide the best
possible customer outcomes. The best way to understand this situation is through thoughtful questioning
and
visualization. If the best solution for a customer is to buy a sofa now, that is fine. But digging
deeper leads to
future rewards. That requires finding out why they want that sofa, who will use it, where it will go,
and what it will
look like with other items in their room. Do they love everything else in the room? Why or why not? Have
they ever seen
a room makeover?
-
Use Technology to Organize a Deep Book of Business. Previous articles in this series
explored the benefits of sales
pipelines to manage business and are worth reviewing (see www.furninfo.com/authors/david_mcmahon/6). A
side effect of
project selling is that there is much more customer work-in-process (WIP). With more WIP, technology
tools become
necessary to manage and automate tasks to provide optimal customer experiences and prevent them from
being underserved.
Putting efficient processes in place allows salespeople to maximize sales results by increasing customer
follow-up and
preventing sales from falling through the cracks.
-
Next Steps. Adopting a project mindset requires that every customer interaction has a
next step. If the interaction is a
sale, the next step is to follow up or provide the next purchase ideas. If it is not a sale, the next
step may be to try
to get an appointment to review ideas sent via email, text or home visit to get measurements. There must
always be a
next step. Ensure your sales team has a reminder system in place that prompts them to execute next steps
more often.
Doing so will elevate your customers’ experiences and produce more traffic.
-
Leading / Driving Metrics. Consider monitoring, and then improving selected leading (as
opposed to lagging) indicators
of a project selling mindset. Common examples are appointments made, house calls, room plans, sketches,
follow-up
scheduled, follow-up done, quotes, referrals, and be-backs.
“Adopting a project mindset requires that every customer interaction has a next step. If the interaction
is
a sale, the
next step is to follow up or provide the next purchase ideas.”
Conclusion
In today’s challenging retail environment, businesses that adopt a project mindset rather than a product mindset
are
more resilient and successful. While in-store traffic fluctuations remain a concern, operations that focus on
creating
their own opportunities by treating each customer interaction as part of an ongoing project—rather than a
one-time
sale—consistently outperform their peers.
By shifting towards project-based selling, businesses can improve all three key elements of the retail sales
equation:
- Increase traffic by fostering customer engagement and repeat visits.
- Boost close rates by developing deeper relationships and ensuring that customers return.
- Maximize average sales by encouraging larger purchases that align with the customer’s long-term needs.
This approach’s success is rooted in strong leadership, refined selling techniques, active listening, and the
use of
technology to expertly manage customer relationships. Retailers that embrace this philosophy see higher customer
satisfaction, greater brand loyalty, and stronger business performance—even in a slow market.
Regardless of price points or market positioning, any business can benefit from adopting a project mindset. By
focusing
on the complete customer journey and providing meaningful solutions beyond just individual transactions, they
can create
sustained growth and long-term success.
