September 27, 2011
by Bob Meyer, Editor of BarterNews
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From the desk of Bob Meyer...
Industry Anticipates Excellent Holiday Sales, Given Forecast
Shoppers are expected to make fewer trips to stores and when
they do show up, to head straight for bargains they have
researched in advance. Given such a forecast, trade exchange
owners expect to see their savvy members taking advantage of
the numerous barter offers within their exchanges this
holiday shopping season.
Sees Stalled Growth
According to reports by the worldwide package delivery
company FedEx Corp., the U.S. economy is treading water, at
best. (The sheer volume of goods moved by FedEx makes its
shipment trends a bellwether for consumer demand and
They report that businesses continue to keep inventory lean
based on weak consumer sentiment, thus containing shipment
volume and heightening the focus on cost controls to boost
Hotelier Bartered For 1/3 Of A Multi-Million Dollar Empire
Last week BarterNews reported on how hotelier Laurence
Geller had recently, through a string of clever deals,
rescued Strategic Hotels & Resorts and its 17 trophy hotels
from the brink of financial ruin. What we didn’t include in
the article was how the 63-year-old Englishman acquired his
empire through barter — by teaming with Goldman Sachs Group
and its partner famed real-estate investor Bill Sanders’
Security Capital, to form Strategic Hotel Capital back in
It occurred when Goldman and Security Capital each
contributed $200 million, while the wily Geller chipped in
$4 million plus his hotel expertise for a third of
From All-Time Most Successful Coach
Former UCLA coach John Wooden’s accomplishment of winning 10
consecutive NCAA college basketball championships, will
likely never be duplicated. Known for his ability to
communicate, one of Wooden’s succinct suggestions was this,
“Failure is not fatal, but failure to change might be.”
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See you next week. . .)
Most From Your Ads
advertisement to be successful, it must grab the reader’s attention.
Here are seven suggestions to make your advertising more
layouts often pull better than neat ones. One split-run test
showed busy layouts out-pulling neat ones by 14%.
shapes, sizes, and colors. People will get bored, and turn the
page, if there is no variety.
attract attention. But usually, it isn’t cost-effective. Tests
show that color is not a good idea in four out of five cases.
something odd into a picture will attract attention. In a
Hathaway shirts campaign, the model wore an eye-patch. That odd
detail made the campaign famous, as well as successful.
extraneous props divert attention. One company ran a curtain ad
with a cute teddy bear. They got more calls about the bear than
are more convincing than drawn illustrations. Photos can
increase response by over 50%.
Before-and-after pictures are very persuasive. This technique is
a great way to show the benefit of your product.
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update any changes to your company’s listing, such as new location,
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Baseball, as a metaphor or analogy, can teach us about many things.
“Hitting a home run” could mean making a big sale in the business
world. “Reach for the fences” inspires people to achieve their
dreams. A “ballpark” figure allows for a broad area of
approximation. But can baseball really be used as an analogy for the
Industry thought leader Mark Ryski shares new and innovative
techniques for extracting powerful insights from basic store traffic
and customer conversion data, delivering a game-changing look at
this crucial retail information.
The Trouble with Traffic
— What Retailers Can Learn from Baseball
By Mark Ryski
When a retailer is asked if traffic is up or down, there’s a very
good chance that the answer provided actually refers to the store’s
“transaction count” or what is sometimes ambiguously referred to as
“customer count.” No one seems to probe on this, so by default
transaction count has become an acceptable proxy for store traffic
count. But there’s another rub: transaction count is not the same as
Transaction Counts vs. Traffic Counts — Hits vs. At-Bats
say that transaction count represents a reliable proxy for store
traffic is analogous to saying that hits are a reliable proxy for
at-bats in baseball. Yes, the two stats are related, but they are
not proxies — not even close.
baseball statisticians only tracked hits, without considering
at-bats and batting average, how much less would we understand about
the greatness of players like Ty Cobb or Babe Ruth? A lot less. The
same is true for retailers. Transaction counts (hits) may be up, but
knowing if it was a result of an increase in store traffic
(at-bats), or that the retailer was more effective at converting the
store traffic is an important distinction. This is not a subtle
point. Here’s why.
Why Store Traffic Matters
Store traffic is a measure of all the people who visit the store,
including buyers and non-buyers. Traffic is a leading indicator that
tells us something about a chain’s sales opportunity — more traffic,
more opportunity. If traffic is trending up, this is clearly a
positive sign. It suggests that the brand is in favor and
opportunities abound. The converse is also true. If store traffic is
waning, this is disconcerting and it could indicate that the banner
is falling out of favor. The number of sales opportunities is
problem with relying on transaction counts as a proxy for traffic is
that they could be going up regardless of whether actual store
traffic is going up or down. To understand this apparent paradox,
you need to consider the retailers’ batting average.
Conversion Rate — Retail Batting Average
mentioned, store traffic count defines the sales opportunity and is
analogous to at-bats. Transaction count represents buyers only and
is analogous to hits. Therefore a retailer’s batting average, or
conversion rate, is calculated by dividing the transaction count by
the store traffic count — just like in calculating batting average.
Store traffic and conversion rates tend to be inversely related.
When store traffic falls, associates are able to deliver a higher
level of service, check-out lines are shorter, and generally it’s
easier to buy. The transaction count often goes up, despite the fact
that there is actually less traffic in the store. In this case store
traffic didn’t increase, but if the retailer only has transaction
counts to rely upon, then he reports “traffic is up.” But it’s not.
And yet all parties — the retailers and the inquisitive analysts –
seem to tolerate the ambiguity.
Don’t Ask, Don’t Tell
Wall Streeter told me that you can’t ask a retailer about traffic
counts if they don’t track traffic in their stores. True, but you
also can’t have two definitions for this basic metric either. If you
want to ask about transaction counts then ask for transaction
counts, and if you want to ask about store traffic, then ask for
store traffic. This shouldn’t be open to interpretation.
There is a simple way to inject clarity into what has become a
convoluted question. Instead of asking retailers if it was “ticket
or traffic” that drove results, analysts should ask if it was
“ticket, traffic or conversion.” While most retailers don’t track
store traffic and so won’t be able to answer, at least it will be
clear that they don’t and you will know they mean transaction count
— which on its own tells us little about what drove results.
for the retailers who do track store traffic and measure conversion
rates, you will have a much deeper insight into what actually drove
sales results. Maybe retailers, and Wall Street, need to take a page
out of the baseball playbook.
Mark Ryski is the
founder of HeadCount Corporation and author of
Conversion: The Last
Great Retail Metric and When Retail Customers Count.
Five Simple Rules To
Help When It Matters Most
Author Dave Anderson shares his thoughts on the business
implications of issues like white lies, false impressions, and
forgiveness in his book A Biblical Blueprint to Bless Your
Business (A revised and expanded edition of Anderson’s How to
Run Your Business by THE BOOK.
“Character does matter in business,” he advocates. “And there’s no
time like the present to sit down and define your goals for the
character of your company with your employees. When you really think
about it, many of the transgressions we see in business today, from
CEO scandals to terrible customer service, boil down to a lack of
That’s right. Anderson is asking business leaders to get serious
about defining what their company stands for — and share those
values with employees. “It’s amazing how few leaders take the time
to do this,” says Anderson. “They may feel uncomfortable discussing
character issues, or maybe they’ve never given a lot of thought to
what they really stand for themselves. But just resolving to sit
down and articulate your beliefs is a powerful exercise — and one
that yields powerful results.”
exactly certain what constitutes good character? Anderson says there
are five simple rules that every employee should follow to ensure
that they have a rock-solid character:
Don’t tell white lies.
We’re all guilty of telling a white lie or two. In fact, most of us
do it on a daily basis and hardly even notice anymore! And while we
may consider those little untruths to be harmless, consider that
instructing your receptionist to tell a caller that you’re out of
the office when you really aren’t is a reflection on your own
character. White lies are still lies, after all. Think of how many
business scandal stories there were this past year, and how many of
them were the result of dishonesty — and how that dishonesty
shattered the lives of so many people.
“White lies are like the gateway drug to bigger offenses,” says
Anderson. “And even though telling the truth is often the hard and
unpopular thing to do, honesty is rule number one to developing
sound character. Tell the truth because it is the right thing to do,
and encourage your employees to do the same. In the end it protects
your personal integrity, and honors, rather than diminishes,
everyone who hears what you have to say.”
Keep your commitments.
Have you ever made a business promise that you didn’t keep? Perhaps
you didn’t follow through with a promised promotion, or skipped out
early on a day when you promised to work late. And given the present
turbulent economy, it’s even more likely that you found yourself in
a situation where your mouth wrote checks in the good times that
your bank account can no longer cash. Cutting expenses is necessary
and understandable, but Anderson warns that breaking promises is not
— even if it turns out to be more costly — inconvenient or more
time-consuming than you estimated.
“Don’t take your promises casually,” asserts Anderson, “and explain
to your employees that they shouldn’t either. This is a real test of
‘practice what you preach,’ as your employees will be less inclined
to follow this guideline if they don’t see you doing the same.
Before you commit to anything, make certain that you can live with
the worst-case scenario resulting from what you’re agreeing to, and
always, always follow through. Do what you said you’d do, regardless
of the cost.”
Go the second mile.
One of the most common character flaws in leaders and their
employees is that they do just enough to get by; they come to work
and do just enough to get paid and just enough not to get fired.
That’s not good enough, says Anderson.
suggests thinking about it this way: If the majority of people are
doing only the minimum, then those who give just a little bit more
of themselves will stand out and be highly valued — a great asset
for any company or individual to have. So think about what you can
do to go the extra mile each day. It may mean volunteering to take
on an extra project, coming in on a Saturday once in a while, or
taking a night class to improve your skill set. Whatever that extra
mile may be, the benefits will be well worth your sacrifice.
“Some of the most successful business people will readily admit that
they are no smarter than their less successful counterparts,”
explains Anderson. “They simply outwork them, out-think them, and,
as a result, outperform them. By doing what others were unwilling to
do, going where they were unwilling to go, saying what they were
unwilling to say, learning what they were unwilling to learn, and
risking what they were unwilling to risk, they earned a success and
a lifestyle that the ‘just enough’ crowd was unable to attain.”
Don’t give false impressions.
When it comes to business, false impressions are everywhere. From
misleading advertising campaigns to padded resumes, you won’t be
hard pressed to find examples of people trying to make others
believe things are better than they really are. But Anderson says
that you have to be upfront and honest with those you work with, or
you may lose your credibility and build up bitterness and resentment
in a once-valuable business relationship. Think about the ways that
you or your company may be misleading others, and find ways to stop
“There are a few simple things you can do to get your employees and
organization on the road to transparency,” explains Anderson. “For
starters, stop any misleading advertising you may be engaged in —
and if you’re not sure if it’s misleading, then it probably is! Make
sure that you aren’t spinning feedback to make someone feel as
though they’re doing better or worse than they really are. And
certainly don’t mislead any potential job candidates or employees
about realities concerning compensation, advancement, or future
plans. Cultivating a culture of honesty in your organization will
only bless your business.”
Reconcile and forgive immediately.
Holding grudges is a common and unfortunate consequence of
competitive business. Resentment builds up when employees leave
organizations, mistakes are made, or when coworkers feel slighted.
Take an inventory of grudges you may be nursing, people you’re
resenting, and those with whom you must reconcile. It doesn’t matter
how far back the offense was. If you’re carrying it around, it’s
affecting your performance, whether you realize it or not. Suggest
to your employees that they think about any hard feelings they may
be harboring, and encourage them to make amends.
“When you are busy harboring resentment and holding onto grudges,
you are taking time and precious energy away from the things you
could be doing to increase your productivity and your business,”
asserts Anderson. “Bring closure to past offenses. Identify amends
you must make, with whom, and do it quickly. By holding onto these
hard feelings, you aren’t hurting the other person; you’re hurting
yourself! And having a clear conscience and a sound heart is a key
component to having a solid character.”
Still skeptical about your ability to pull off this company
character assessment — not to mention how well received it’s likely
to be? Just give it a try, urges Anderson. You’ll be pleasantly
surprised by the results. But if you can’t bring yourself to discuss
these matters openly, just living them sends a persuasive message.
“It’s one thing to sit down with your employees and share your
values, but the best way to get the message across is to make sure
you are setting the example yourself,” Anderson concludes. “You have
to walk the walk. If you haven’t been doing so, make a point to
change. Others in your organization will be sure to follow. And
you’ll see firsthand that a business that is based on strong core
values and a shared vision is one that’s headed for long-term
success and prosperity.”
Dave Anderson has given
over 1,000 leadership presentations in fourteen countries. He is the
author of numerous business-oriented books and the TKO business
series. He and his wife, Rhonda, are cofounders of The Matthew 25:35
Foundation, which helps feed, educate, and house under-resourced
people throughout the world.
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