©2013 Liz Kislik Associates LLC Increasing Average Order Value April 2013 Operations Summit Liz Kislik, President, Liz Kislik Associates

©2013 Liz Kislik Associates LLC ©2013 Liz Kislik Associates LLC ©2013 Liz Kislik Associates LLC

Increasing Average Order Value

April 2013

Operations Summit

Liz Kislik, President, Liz Kislik Associates

©2013 Liz Kislik Associates LLC 222 ©2013 Liz Kislik Associates LLC ©2013 Liz Kislik Associates LLC

What We’ll Cover Today

• Customers relationship and expectations

• What and how to offer

• How to work with reps

• Management, measurement, motivation

©2013 Liz Kislik Associates LLC 3

It’s Harder Than It Used to Be

Decision makers are over-trained

Only testing will tell you

©2013 Liz Kislik Associates LLC 4 ©2013 Liz Kislik Associates LLC

The more you ask from your customers,

the greater your obligation to understand them.


The Role of Impulse

Consumers do pre-call planning


Customers Can’t Stand Being…

• Pushed

• Slicked

• Taken for granted

• Treated mechanically


Understanding “No”

When does it occur in the call?

What is it a response to?


Make Each Customer Special

• Customer history counts

• Phone only vs. multichannel

• Clear value proposition

• Clear service positioning


Confirm Brand Image and Value

• Sell what you sell

• Reps must be credible


Preparing Offers


Picking Product

• Easy to picture and describe

• Low rate of return


General Appeal vs. Customized Choices• Enhances value of

base product

• Hard to find

• Related to order or customer

• “Collaborative filtering”


Price Points

• Consider 1/3 of order total or item

• Not higher than highest single line


To Discount or Not to Discount

• Avoid “training” customers


Discount Rationales

• Discount eligibility• Order size• Purchase history

• Our mistake; your benefit• Overstocks and liquidations• Manufacturing/purchasing efficiency


Shipping & Handling

• Barrier to purchase

• Seems like manipulation

• Make S&H the “special”


Offer Structures That Work

• Permission, not Product

• Product A vs. B

• Diminishing Value


Getting Your Reps on Board

©2013 Liz Kislik Associates LLC 19 ©2013 Liz Kislik Associates LLC

It’s Ok to Sell AND

100% Offering is Fiction


Reasons Not to Offer

• Product?

• Customer history?

• Customer circumstance?


When to Call it Quits

• Not until “No”

• Maximum of two


Helping Customers “See”

• Bring customers to the page or screen

• Put people in the picture


Coaching after Observation

• Individual

• Concrete

• Include language practice


The Supervisor’s Role(s)

• Trainer?

• Sales Coach?

• Enforcer?


Training Tips

• Group by skill or tenure

• Have the product present

• Practice language


Management, Measurement,

and Pay


Typical Organizational Structures• Ops in charge;

Merchants supply produce

• Merchants in charge; Ops implements

• Sales/Marketing in charge


Systems Requirements for Reps

• Offer prompts

• Flags for “no offer”

• Detailed product info

• Subtotals


Components of Metrics and Tracking

Offers

Orders

Items

Dollars


Reporting Rates and Trends

Conversion

Returns

By subgroup

0

1

2

3

4

5

6

Series 1Series 2Series 3


Setting Achievable Targets

• Reality testing

• Raise the bar over time

• Quantity plus quality


Paying for Performance

• Variable comp complicates life

• Set baseline first

• Choose incentive targets carefully


Pay that Motivates

• Is easy to calculate

• Has rhythm and pace


Things to Watch

• Stockouts

• Skipping offers during high volume periods

• Gaming the system


Successful selling and

lifetime value rely on

good relationships

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Documents

©2013 Liz Kislik Associates LLC Increasing Average Order Value April 2013 Operations Summit Liz Kislik, President, Liz Kislik Associates