Couch analytics #246. Is electronics salesman a dying profession?

The trees used to be big, the grass green, and the sky blue. In any case, this is how we talk about the past, when everything was much better than today. But if we talk about the current quality of work of sellers in retail selling electronics, there are always questions and questions. Over the past few years, I have heard such conversations that my ears curled up into a tube. Moreover, these are not only small retail chains, but also such monsters as MVideo, you can read one of these conversations at the link.

You can lead the discussion into an emotional plane, but there will be no sense from this. Let's try to evaluate the quality of the salespeople, their ability to explain the strengths and weaknesses of the product, and also try to understand why the education of salespeople no longer plays any role for large retail chains. The question is so multifaceted that it can be approached from different angles. I will try to highlight certain topics that need to be taken into consideration.

Seller cost - star, beginner or average?

The profession of an electronics salesman requires certain knowledge, the ability to show and tell about the products that are on the shelf. The more categories of products are presented in your store, the more knowledge the seller needs to have in order to provide a quality service to the buyer. Knowledge about smartphones can be projected, in theory, onto tablets, perhaps accessories, but it is difficult to expect that such a seller will be as versed in TVs, washing machines and vacuum cleaners. It would be a misconception that salespeople can talk equally well about different products. In some retail chains, this is required of them, but this is an ideal that is unattainable in practice.

In the 70s in America, with the heyday of large electronics stores, they faced exactly the same problem - diverse products and a limited staff of sellers, lack of training information (there was no Internet then, and there was, in fact, nowhere to read about products). The solution was found quickly, even if it does not sound elegant - the seller should know a little more than the buyer. It was assumed that most of the buyers are completely unaware of the goods on the shelves, which means that they can and should sell them effectively, talking about the characteristics that the product has.

You'll never guess what was born from this approach, which instantly became mainstream. Manufacturers began to compete in "technology," not in the actual technology that distinguished their products, but in marketing sophistication. That is, when you came to the store, you heard that such and such a TV is incomparable, as it has such and such technology. For example, in the 60s, Sony TVs were sold in America, they quickly became the quality standard, as they were distinguished by the brightness and clarity of the picture. But in 1968, Sony introduces the name Trinitron for the first time, a marketing name that combines a number of parameters. This is an attempt to simplify the choice for the user, to make life easier for the seller. Nowadays, some manufacturers have gone as far as mindlessly copying the game in marketing terms, and one product can contain several dozen names of "technologies". Sometimes they are brought to the fore, the names are written on the product box or even on its body.

For example, OLED screens are a type of display, but today we believe that in most products AMOLED screens are all thanks to Samsung, as the company actively developed this marketing term for its reading of public technology. And many consumers are well aware that AMOLED screens exist from different manufacturers, although, in fact, it is a Samsung trademark. Then Samsung developed the brand, the Super prefix and other variations appeared.

But at the heart of the history of individual brand names for electronics components is a desire to create an advantage on the store shelf. Equip the seller so that he can drop a resonant name in between, which should persuade the buyer to your product.

The approach itself assumes that the seller should not and cannot deeply understand the issue. A star seller is bad for business most of the time unless the market is in a booming phase. And at the stage of this growth, it is not needed, since buyers will buy anything.

In Russia in 2002, buyers of mobile phone stores trusted sellers (hereinafter, MRG data, unless otherwise stated). The level of trust was high, about 60% of buyers were ready to purchase the product that the seller advised them. It seems like a gigantic number, but the market was smaller five years earlier and the confidence level was around 86%. For comparison, today the level of trust for sellers is 18% (end of 2020). It is easy to find an explanation for this phenomenon, the level of knowledge of buyers has grown, for them a mobile phone (as well as a smartphone) has ceased to be a curiosity, has become an everyday product. Many people bought more than the first device and chose it with skill, the seller could influence this choice to the least extent.

Every person has a value in the labor market. A generalist who is well versed in different categories of goods, knows how to communicate with customers, is worth its weight in gold at any time. But there are not so many places where he can work, these are retail stores and, less often, chains that rely on the quality of service and product knowledge. For example, in Moscow, such a store is Dr. Head", you can try almost any headphones, get high-quality advice. In chain stores selling audio, there is no such level of sellers, and with such a familiarity with different headphones, speakers, and other equipment. They simply do not have the opportunity to grow professionally, even to try headphones at the moments when they are waiting for buyers. What does this mean? That the cost of salespeople, their salaries at Dr. Head" is noticeably higher than that of a regular seller from a chain store. This is a conscious bet on the quality of service, which is impossible without the experience of sellers.

Regardless of the category of goods you sell, it is impossible to create a large structure that will be focused on the quality of service, knowledge of sellers and at the same time be effective. Very quickly, the idealistic approach is replaced by a pragmatic one, since there is a huge shortage of personnel in the market. Often, salespeople are those who have not found themselves in other areas, often they are students, and the work is perceived as temporary, as a result, few decide to invest their time and efforts in professional growth. Please note that quality service is often directly related to the age of sellers. The older the seller, the better advice he will provide (as usual, there are exceptions to this rule).

For chain retail, regardless of the size of stores, the ideal approach is the absence of a noticeable number of stars, they are quickly transferred to the status of trainers, removed from communication with customers. At the same time, further it is necessary to maintain a balance between beginners who are just starting to trade, and "old people" who have already got used to it and can help beginners develop in this place of work.

The balance here is found empirically, usually about 60-65% of beginners, "oldies" occupy the rest. The staff turnover is huge, many newcomers do not live in retail for more than three months and leave in search of a better life. This explains the preponderance of beginners compared to those who know this business. But at the same time, those who have been working for a long time experience heavy loads, so they also leave. In Russia, the average operating time for an electronics salesperson today is 11 months. Which is extremely small, and happy exceptions only emphasize this rule.

Motivation of sellers - sweatshop or struggle for survival

For chain retail, the most important cost item is marketing, the maintenance of physical stores, since a person can come to them and then he needs to be converted into a buyer. A star seller can scare the buyer away, confuse him and make him think about what exactly he wants to buy. Moreover, stars often discourage buying something, as they consider the product to be bad and advise you to look at other products that are not presented in his store. To some extent, these are altruists who shoot themselves in the foot, as they refuse the bonus for the sale, but give the right recommendation to the person.

The approach of stores is much more utilitarian, their task is to sell goods that bring maximum profit. Often this is not at all the product that is best for the buyer, sometimes it is the exact opposite of his interests. Understanding this, all sales motivation, all trainings are built within the framework of sales imposition, when they try to deprive the buyer of freedom of choice. I have great respect for DNS, since this trading network has a fundamentally different ideology, sellers are trained in such a way that they give Oven for Sale the most accessible information, they tell them how to choose the right equipment. The approach is ideal, in life it often fails, however, the DNS example looks atypical for the Russian market, and indeed for any other.

Let's look at the example of MTS, where they constantly launch one or another motivation program for sellers, change focus products. This pandemonium does not imply any rationality in principle, since the only approach that attracts people to MTS stores is a discount on goods. Today the MTS seller sells some "Chinese", tomorrow - others, then they focus on Samsung, and then the circle repeats. But the problem is that the sellers learn almost nothing about the products at the same time, they read small leaflets from the company, voice the very “chips” that are mentioned there. But as soon as you try to dig a little deeper, "knowledge" ends. And this is not only a problem of MTS, in general, the story in operator retail is as follows. Against this background, MegaFon's retail looks better than others, their training system is not perfect, but noticeably better than that of competitors.

The seller's salary is meager, and he receives the main money as a percentage of sales, such motivation is considered fair in the market. And therefore, every visitor is a person who needs to sell something at any cost. Hence the wildest inventions about products, the desire to keep the buyer. Or complete indifference, when the seller has already realized that he won’t be able to make money, and just scores on his job. Hence the very turnover of people, they quickly burn out, since there is no special career ladder and prospects. This is a struggle for survival at its most naked.

And then feedback from buyers begins, they are faced with indifference, inventions, poor-quality advice and immediately refuse advice. Which leads to the fact that the meaning of the seller’s work is lost, and the buyer goes to an online store or simply chooses a specific product and does not want to listen to what is being imposed on him. It also leads to fewer people wanting to work as electronics dealers as the job becomes more difficult. The “oldies” are leaving, newcomers quickly burn out, the influx of new people is not the same as in previous years. Against this background, even taking into account the sharp reduction in the number of electronics stores, there are no places that give adequate pay for this work. The age old story is that retail chain owners complain that the quality of the salespeople is low and they don't deserve more pay. Sellers naturally do not process and do not develop. A vicious circle that can only be broken in one way - a sharp reduction in retail chains, against which sales will increase in specialized stores, where people come for quality advice. So far, there is no ideal, but branded retail, where goods of only one brand are sold, shows that this format is in demand and is loved by customers. Trust in salesperson advice in branded retail is amazing, with numbers approaching 80%. And this means that this format will develop actively. It is expensive, complex, with low profitability, but it is he who builds the right relationship between the seller and the buyer.