3 Fresh Ideas to Increase Sales in Luxury Retail Stores
Many of the ideas you hear for increasing sales in luxury retail stores are typically focused on the buyer and business tactics. And it makes sense that you take a buyer-first stance or use tactics like scarcity to increase sales at your store. But what these two approaches overlook is one of the most critical components of selling retail goods: the salesperson.
With sales associates in mind, luxury retailers can tap into a force that influences purchases as much as branding or marketing efforts. Specifically, there are three areas luxury retailers should focus on to get more goods off the shelves. To start, let’s get into the head of your sales associates.
1. Understand the Psychology of Sales Associates, Not Just Customers
Most retailers know an incredible amount about their customer’s buying habits, thoughts, and wants and needs. Yet, the psychology of the salespeople that serve these customers is often neglected.
Sales associates are the true engine of any retailer, whether luxury or mass market. So why would you not take the time to get to know how they tick? And I’m not just talking cash. While sales associates are driven by incentives, money isn’t everything. Sales associate motivation is much more interesting.
Business anthropologist and psychoanalyst G. Clotaire Rapaille’s research discovered:
…money is not what really drives [salespeople] to get back in there and keep trying. It’s the value they place on the struggle.
This value of the struggle, “the chase” as Rapaille puts it, can be more effectively leveraged with the proper communication. Transparency into incentives and quota can all effectively reinforce this struggle. Showing sales associates how close or far away they are to hitting a goal can spur them into action. One of the best ways to do this is put the information where sales associates are most likely to look.
2. Let Sales Associates Use Their Phones
Hold on! Before you close out the blog, hear me out. As mentioned before allowing sales associates to visualize “the struggle” as Rapaille puts it, can lead to an increase in performance. Tools like Xactly’s sales performance management software not only automate commissions processes but gives sales associates access to quota attainment and compensation estimators right on their phones.
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This keeps sales top of mind for associates and gives them an excellent reason to be on their phone. The motivating power of this ability is one of the reasons Louis Vuitton has rolled out the solution at its stores. And because the process is automated, your sales associates, as well as your compensation admins, spend less time doing unnecessary calculations and more time on what matters.
Speaking of, one of the best ways to discover what matter is to let machines direct you toward the numbers that matter.
3. Let Data Drive Decisions
“Machine learning” and “prescriptive analytics” are the current buzzwords for a reason. When they work, well, they work. And big data isn’t just for the IBMs and tech behemoths of this world. In some ways, all big businesses today are tech companies, including luxury retail. And not in the product produced per se but the business practices and software that companies utilize.
A consequence of this technological crossover is that companies should now start letting the data do the driving. When it comes to sales associates, in particular, the tools available have the power to transform whole industries.
Take Xactly’s Insight for Sales™ for instance. This tool taps into 12 years of pay and performance data from best-in-class companies. Importantly this feature creates an external framework to benchmark against and derive best practices. Insights for Sales not only allows you to compare sales associate performance against your own store and other companies, it provides recommendations based on that data. With these numbers, luxury retailers can optimize pay to drive better performance while avoiding pitfalls.
Increasing sales in retail won’t come from simply focusing on customers or business tactics. The salesperson is vital to any initiative designed to move product from your stores. Understanding sales associates is the first step, but from there it’s about providing the right tools and systems to support them. Communication, transparency, and process all affect the effectiveness of your sales compensation and subsequently your sales associates. If you want to motivate your salespeople, remember how you do so matters almost as much as how much you’re paying.