Mobile payments are on the rise this holiday season! Black Friday shopping proved to be very mobile, with consumers looking for coupons and deals for both in-store, and online purchases.
According to an announcement Monday from eBay, shoppers opted to reach for their mobile phones and tablets in record numbers this year on Black Friday.
The combination of mobile shopping data from eBay, PayPal, and ecommerce and interactive marketing services provider GSI Commerce tells the whole story:
- Shoppers in the U.S. purchased nearly two and a half times as many items via eBay Mobile this Black Friday when compared to 2010.
- Correspondingly, PayPal Mobile announced a six-fold (516%) increase in global mobile payment volume compared to last year.
- GSI Commerce announced a three-fold (254%) increase in U.S. mobile sales on Black Friday.
“Shoppers are increasingly choosing the convenience of mobile to find the best deals from wherever they are while avoiding big crowds and long lines,” says Steve Yankovich, vice president, Mobile, for eBay Inc. “The ability to simply pick up your phone or tablet and purchase what you want, when you want it, has become an attractive alternative to shoppers in record numbers this holiday season.”
A British bakery owner loses at least $19,500 after creating a Groupon offer and being swamped with thousands of orders.
LONDON — A bakery owner was forced to make 102,000 cupcakes after being swamped by customers taking up her cut-price Groupon offer, according to reports Tuesday.
Rachel Brown offered a 75 percent discount on 12 cupcakes, which normally cost $40 (£26), the BBC reported.
However, Brown under-estimated the popularity of the deal and was unable to cope when 8,500 people signed up for the $10 (£6.50) bargain.
Brown’s Need a Cake bakery, which employs eight staff in Reading, U.K., had to bring in temporary workers through an employment agency to fulfil the orders, at a cost of $19,500 (£12,500) — wiping out her profits for the year.
She also lost between $2.90 (£2.50) and $4.70 (£3) on each batch she sold, the BBC reported.
“Without doubt, it was my worst ever business decision,” she told the BBC. “We had thousands of orders pouring in that really we hadn’t expected to have. A much larger company would have difficulty coping.”
Chicago-based Groupon sells Internet coupons for everything from spa treatments to cosmetic surgery.
Firms sign up in the hope of getting new repeat customers out of the initial deal or selling additional goods to shoppers during their first visit.
Groupon went public earlier this month at $20 a share, valuing the business at $13 billion.
Brown, who has run the business for 25 years, was quoted in the Daily Telegraph saying: “We take pride in making cakes of exceptional quality but I had to bring in agency staff on top of my usual staff, who had nowhere near the same skills. I was very worried about standards dropping and hated the thought of letting anybody down.
“My poor staff were having to slog away at all hours — one of them even came in at 3 a.m. because she couldn’t sleep for worry,” she told the newspaper. “We are still working to make up the lost money and will not be doing this again.”
Heather Dickinson, international communications director for Groupon, told the BBC there was no limit to the number of vouchers that could be sold.
“We approach each business with a tailored, individual approach based on the prior history of similar deals,” she said, adding the company had been in “constant contact” with Need a Cake.
She later told msnbc.com: “We work very closely with small businesses, but ultimately, they know their businesses best and what they’re able to handle.”
She added: “Need a Cake wanted to run a national deal with us, but we advised them to feature in a few cities so they wouldn’t overextend themselves.”
Almost all sales people know what they should be doing in terms of prospecting and closing more sales, but sometimes spending the time to develop and plan the right structure can mean the difference between success and failure. I have seen this many times in my own professional career and thus decided to increase the output of our efforts towards helping our clients with the development and time management aspect of the sales process.
We put together a “Client Planning Worksheet” to help each of our clients set a weekly schedule of their efforts (calls, prospecting, admin, etc), in order to help them understand how much time spent impacts sales results.
How It Works:
The first part of the worksheet features a daily time management schedule, which is where you can fill your calendar with various sales activities, including calls, appointments, and prospecting. For example, maybe on Mondays you make calls from 9:00-12:00 a.m., take a lunch break from 12:00-1:00 p.m., prospecting from 1:00-3:00 p.m., and schedule your appointments from 3:00-5:00 p.m.
The next part of the spreadsheet factors in the sales activities you put in your calendar to show you how much of each activity you will be doing per week. You can enter variables including the percentage of calls and prospecting that typically become appointments, which will then be applied to figure out your weekly totals. For example, if you put that you make 15 calls per hour, and 5% of calls typically become appointments, you will get 1 appointment per hour. Going further, if you make 15 calls per hour and you scheduled yourself with 12 hours of calling each week, you will be making 180 calls per week.
The next part is where sales revenue comes into the picture. The financial projections section forecasts how much revenue our clients will be making based on how many calls they make and the percentage of calls that turn into the appointments, as well as the percentage of appointments that turn into sales.
The worksheet is designed so that our clients can edit their schedule to either add more calls or prospecting per day, which in turn impacts the revenue that will be generated. It is amazing how much your revenue can increase just by adding a few extra sales calls a day.
Things to Remember:
Sales people—if you take away anything from this, understand that your time is extremely valuable. Make the most of it by coming up with a system that helps you organize your time in the most efficient way possible.
Also, understand the methodology of closing sales. We are visual people. Sometimes it’s hard to conceptualize things until you see something tangible. This worksheet helps our clients visualize how much their activities within the sales process directly impacts the results.
If there’s anything I have consistently noticed throughout my professional career, it’s that there is no substitute for core sales fundamentals.
Sellers as well as buyers are taking stock of priorities as the economy continues to show weakness across most industries. As a result, most sales organizations are pursuing new business—which often means taking advantage of competitors’ complacency or mistakes in providing service to customers. In the face of relentless competitive pressure, sales leaders are looking for smart answers to an urgent question: How can we protect our customer base from erosion as competition intensifies?
While there are a variety of potential answers to this question, most fail to get to the crux of the problem: a lack of understanding of how customers want to buy, and a subsequent failure to apply the right resources in the right accounts to ensure protection from predatory competition.
The following discussion offers three effective strategies for strengthening your relationships with your most profitable customers. The goal is to first free up resources that may be tied up in unproductive accounts. These resources can then be applied to create value for your best customers, which will make them resistant to even the most persuasive cost-cutting competitor.
Strategy 1. Assess Your Portfolio
To strengthen ties with your best customers, start by making sure you know who those customers are. Analyze the type and quality of business delivered by each account, and assess the cost of sales compared to revenues. Are some customers using resources that could be better spent on securing more profitable relationships? Are there customers with the potential to provide more business? And what is the status of your relationship with your loyal customers who offer a steady flow of good opportunities? Are they getting the attention and level of service they expect and deserve?
When it comes to the less-productive accounts, sales leaders are sometimes surprised to discover how much it costs to keep customers who are not consistently providing good sales opportunities. Often these same customers demand value-added services they don’t want to pay for. The resources spent to keep these accounts might be better applied to building value for other customers.
As you evaluate your better, more profitable accounts, look for those that were more productive in the past. These may have the potential to provide more business again in the future. And look carefully for customers with whom you have a relationship, but where business may have fallen off due to benign neglect or a lack of adequate service. These should be viewed as “at risk.” With renewed focus and a greater investment of resources, some of these customer relationships could be the source of more revenues.
But how do you determine which customers are too costly, and which should be kept and strengthened?
What is needed is an objective way to evaluate which customers are your real “keepers,” and which ones should perhaps be “fired.” Below are some questions you might want to ask to get a more systematic analysis of your account portfolio.
Questions to Ask About Your Important Accounts
• How do you know which accounts are the most profitable?
You are probably tracking sales per customer, and know the sales and revenues you are gaining per account. But how recently have you compared the cost of sales for key customers? Do you know what you are spending in terms of time and other resources to gain those revenues? If you are tracking COS you may have this data, but many sales leaders say they have focused primarily on the top line and do not necessarily compare the COS to revenue per account.
• Are you aware of which accounts are regularly providing good, winnable opportunities?
As you review your customers, look closely at the quality and quantity of opportunities in each account. Ask these three questions:
o Is there a consistent flow of real opportunities?
o Do the opportunities tend to bring true value for both your organization and the customer?
o Do you generally win the opportunities you identify, or are you competing for business at the cost of discounting and providing value-added services the customer doesn’t pay for?
• Do any of your current customers have potential to deliver more sales?
o Did any of your accounts previously provide more business?
o Are there accounts that have been neglected or taken for granted?
You may find that some of your long-time customers, even key accounts, are taking up resources such as technical advice, consulting, and other services they don’t pay for. And some of these customers are not yielding a comparable amount of good business. Consider cutting your ties or pulling back from these accounts, and re-allocate the resources to build stronger connections with genuinely profitable customers. Also look at renewing relationships with accounts that have potential for increased business.
Strategy 2. Strengthen and Protect Current “Big R” Relationships
As you assess your current business, determine what type of relationship you currently have with each customer, and what kind of relationship you want. First, it’s important to keep in mind the difference between what could be called a “Big R” and “little r” relationship. We define “Big R” as long-term relationships with strong company-to-company connections. The best of these customers are loyal to your organization—for reasons to be reviewed in a moment—and provide a steady flow of good business.
We define “little r” relationships as the networks of interpersonal connections sales reps must build with individual customers. These “little r” relationships—built on personal trust and confidence in the sales rep—are absolutely necessary, but not sufficient to protect a customer from predatory competitors.
As every salesperson knows, individual contacts may change roles, leave the company, or otherwise become unavailable to influence buying decisions. (One study suggests that as many as 33% of employees change jobs each year. ) When the relationship between your two companies is strong, the loss of even a key contact is less likely to affect the customer’s commitment and ongoing sales.
So one question to ask is: How many Big R relationships do you have among your productive accounts, and what are you doing to make sure these customers continue to do business with you? The advantage of having these customers in your mix of accounts is that price is usually secondary for them. Typically they are buying solutions from you that are more integrated into how they do business and for which they may lack expertise. Their concerns are with the kind of training and support you offer, your track record and stability, and your capability to grow with them. These factors create switching costs. This means it is not easy for these companies to change suppliers without incurring significant costs associated with re-training, disruption of their business, and other issues.
To retain these Big R customers, you need to:
• Provide high-quality support and service commensurate with the customer’s investment in your offering and the relationship.
• Keep them well informed about your organization’s technology, business direction, and development of new capabilities and products.
If you find that you have a lot of these types of accounts, make sure they are paying their way. If they are, make sure they are being well served and are completely satisfied with the relationship. Most salespeople can only manage a few of these accounts at best, as they do tend to require a lot of hand-holding and rightly expect quick responses to their questions, problems, or concerns. If they don’t receive the level of support they need, they may begin to question the wisdom of remaining locked into your solutions.
This is why it is so critical to make sure you are not neglecting the needs of these customers, and that there are adequate resources available to keep the relationship strong and thriving. As long as you are demonstrating your understanding of what these customers need from your organization, your competitors are unlikely to make headway, even if they offer the lure of discounted prices.
Strategy 3. Build a Strong Track Record with Your Important Transaction Customers
Think of your Big R customers as buying in a Relationship style. Then think of another set of customers you have who do not buy from you all the time, but buy regularly on a repeat transaction basis—order by order. These customers can provide very good opportunities, and may even be the “bread and butter” accounts you count on for a regular stream of profitable business. Unlike your long-term Relationship customers, however, these Transaction customers typically avoid getting locked in to a given supplier. Their business model and the products they buy make it possible for them to “play the field” if they wish, as they are not going to incur much in the way of switching costs. These companies are less dependent on a supplier for support, expertise, or long-term mutual growth. They are most likely purchasing a solution or product that is viewed as a commodity and are more likely to be responsive to offers of price reductions. How do you ensure you don’t lose these Transaction customers to competitors? By providing them with what they care about the most:
1. Price —These customers do care about getting a competitive price and are vulnerable to cost cutters.
2. Conformance to specifications —They may have quality specifications and other requirements they expect to be met; it’s important to make sure they receive exactly what they need, every time.
3. Delivery —How and when do your Transaction customers need and expect delivery? If you can be faster than your competitors or more able to deliver at certain locations at certain times, you will have a competitive advantage with these customers.
4. Availability —Transaction customers need to know they can rely on you to have what they need, when they need it. A supplier who runs out of stock or asks the customer to wait to receive the materials or products they need may not get another chance to fulfill an order.
So these Transaction customers have the advantage of being low maintenance and lower cost in terms of demands on your sales resources. At the same time, it is critical to pay attention to hitting their targets every time with quality and consistency. They need to feel you are providing them with a fair competitive price, a product or service that consistently meets their specifications, and delivery and availability that fulfill their expectations—without exception. Since they do have choices and it costs them little to switch from one supplier to another, it is imperative to be responsive to the concerns of these customers. If they are completely satisfied, they are far more likely to continue to give their business to you, rather than to a competitor.
With competitive pressures to contend with and finite resources, your best strategy is to focus the time and energy of your salespeople on building strong and lasting relationships with your most valued customers. Taking customers for granted is the enemy of retention. Make sure you know what kind of relationship you have with each account, and that your sales reps are aware of their customers’ expectations based on those relationships. Keep abreast of any changes in the customer’s business model and buying preferences. That will ensure you are providing Big R customers what they need from your company, while meeting the very different needs of good Transaction customers as well. If each customer feels you are providing not only valuable solutions, but selling to them the way they want to buy, your relationship with them will be a strong barrier to competitor encroachment.