Our Ideas

I had an abysmal retail experience yesterday.

I visited a local bike shop with my two kids, primarily to pick up a small spare part, but also to browse the bikes with a view to buying a new one for my wife. I’m a valuable customer there: I’ve bought two bikes already, and I have plans to buy two more this year.

As I looked at the adult road bikes, my son was sitting 20 feet away on a kids bike. He’s eight, so this wasn’t an unusual thing. The owner of the store approached him, and informed him somewhat gruffly that the bike was too small for him. My son responded, “I know.” Clearly assuming that my son was some sort of know-it-all punk, he responded with a bark: “You know?! Well get off it then before you break it!”

My son was shocked. At eight years of age, it’s traumatic when an adult you don’t know barks at you. Two hours later, he was still upset.

I had words with the merchant: “I recognize you need to look after your merchandise, but that’s no way to talk to a child. I’ll be taking my business elsewhere.”

What a shame it is that more merchants today don’t understand how easy it is to excel in retail. Perhaps their ignorance (or arrogance) is the very reason it’s easy to beat them at their own game.

There are three rules that I learned during my retail career that everyone should know before stepping on to the retail floor….

Rule #1: The customer knows best. When it comes to their interests, their needs and their wants, the customer rules. The retailer’s job is to get to know their customers—so that they can make the best recommendations, matching their inventory with their customers’ wants. A retail sales team, should be friendly and empathetic; they’ll generate significantly better than market average sales. I should know: My team consistently performed 30-40% better than industry averages.

Rule #2: You’re selling more than the product. I spent 10 years working in bike stores; we were far more successful at selling ‘fun’ and ‘lifestyle’ than we were at selling ‘bikes.’ The former have no limit on their perceived value; the latter can be a commodity. In practice, this means making the shopping experience fun, making the decor and personnel evocative of an aspirational lifestyle—of health, fitness, vitality—or whatever suits your particular niche. Again, I should know: We held our margins at 3-4% higher than industry averages.

Rule #3: Kids Rule! This was the key to yesterday’s failure at my local store—a parent’s wallet is opened by his children. Make the kids welcome and happy, and the parents will be happy and loyal. I had a truly joyous moment in that same store a couple of years ago, when I bought my son his first two-wheeler. Yesterday, though, that goodwill all crashed down with the harsh, impatient words of one business owner whom I’ll generously assume was just having a bad day.

So what does it all mean in practical terms? I’ve owned, ridden and raced no fewer than 11 mountain bikes since they were invented in the mid-80s. Total retail value: $22,000+. I spend about $250 per year on parts and maintenance, for an additional $5,000 over the 20+ years I’ve been riding at an elite level. I’ll be buying three bikes each for my two kids as they grow, for a total of at least $2,000. And the two road bikes we plan to buy for my wife and I this year—let’s say another $4,000—certainly won’t be the last bikes we’ll buy. Add this all up, and my lifetime value as a customer exceeds $30,000. And this doesn’t factor the half a dozen people every year who ask for my help choosing the bike that’s right for them, and shopping at stores I recommend.

In a business where an annual difference of a couple of percentage points can mean the difference between a net loss and roaring profit, I represent a big loss for any merchant. All because he didn’t have the patience to smile, crouch down, and say, “That looks like fun, big guy, but I’m worried it will break. Do you mind hopping off?”

Oh yeah. Rule #4: Politeness counts.