January 18, 2011

“Let's go shopping!” That was the line I would use at least twice a year when I was the head of a large consumer products company.  You see, we were in the bicycle business, and everyone knows what a bicycle is, and why people buy them.  Or do they?  Or perhaps, do they think they do and don’t?

One of my favorite lines (I first saw it attributed to Mark Twain), that I quote repeatedly is: “It’s not what you don’t know that hurts you; it’s what you think you know that ain’t so.” We would study our bikes in our marketing and design departments and in our showroom.  We would scrutinize them one at a time under halogen spotlights.

We only occasionally brought competitors products in to subject them to the same scrutiny.  Why?  I guess because we didn’t want to copy them, we wanted to “do our own thing.”  That’s admirable, but there is a deadly trap as we learned, quite painfully.

One year our designers came up with a subtly-colored and finely-detailed bike for adult riders.  It was beautiful in our halogen-lit showroom.  We stroked it and caressed it and invested a lot of money in placing and promoting it.  And it bombed.  Why? Because the retail stores we sold to didn’t display bikes all alone, or under halogen floodlights.  There were rows of bikes, tightly packed together, under modest fluorescent lights mounted way above them.  Our subtle, beautiful bike simply “disappeared” in this display setting.  A garish competitive bike nearby outsold it because it simply attracted more attention.

That was it.  From then on, once in the middle of the year, the peak “nice weather time, ” and one “pre-Christmas,” I’d take my senior staff (yes, the C-suite people) to spend a mid-week afternoon shopping at retail stores.  We learned so much.  First we learned how our product matched up to competitors in the setting where consumers were deciding which one to buy.

Next, we learned how the point of sale signage we attached held up to the rigors of retailing and consumer “touching.”  We learned much more, too. Some stores didn’t quite assemble the bike right.  Others let the products get terribly dusty (a bad sign, since it means it has been there a long time and not sold—unless they never sell the display model and sell from back-stock).  Still, dirty bikes don’t sell well.

This simple process was so revealing that our shopping trips became something desirable to participate in.  However, retailers do not appreciate hordes of guys in suits and ties all clustered around their products during business hours.

That meant we had to break up into smaller groups, and be considerably less visible.  But we still went.  One year we took our Union President and VP.  What an eye opener they got, when competitive bikes much like ours were selling $10 to $20 cheaper.

We always took our customer service manager and our quality assurance manager along.  They’d come back with a treasure trove of ideas, new tests, inspection criteria and so forth.

I learned more of this approach from the late Mr. Sam [Walton], who was a master of competitive shopping—and learning. But he went at it a whole different way.  Mr. Sam was known to admonish people who were with him when they told him, or showed him, how much better Walmart did something than the competitor. Sam would send them off to find some things the competitor store did better than Walmart—so they could learn from those.

In the end, I discovered something priceless from just going shopping to see how our goods measured up to competitors and our own aspirations.  I learned, as Yogi Berra once said, “You can see a lot just by looking.”

But you have to get out of the office, the conference room, and the showroom to do some looking.  Anybody want to go shopping?  It pays big dividends.

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