The retail landscape has become more complicated over the years, but as direct marketers, our mission remains the same: to find a group of people that desires a set group of products or services and lead them to a place where they can learn more about them (a store, website, etc.). I call it “inviting people to the party.” Naturally, the overall success of any operation relies on more than just getting people interested—it takes a whole team to ensure that we can provide our guests an experience worthy of their loyalty.
When I partner with clients to review and augment their marketing programs, I seek strategies to add value, and frequently people expect it to come from adding in some new technological innovation. Often, however, what we find is that the most significant gains are not from the result of bringing in “the next big thing,” but instead improving various elements related to teamwork and leadership.
I recently re-read a book that has helped shape my approach to all relationships and interactions with teams: Extreme Ownership by Jocko Willink and Leif Babin. This book, written by two decorated Navy SEAL officers, has applications that apply directly to business and far beyond. If we’ve ever spoken at length, we’ve likely discussed it. The principles outlined in the book are not cutting-edge things, but fundamental principles that are vital to the health of any functioning team, whether it’s in business or otherwise. Written from the perspective of leadership, Willink, and Babin outline principles that apply within any team environment. In essence, you don’t have to be in a company leadership position to exhibit and model leadership behaviors. I want to reflect on five fundamental principles that stood out, including actual examples of how they have impacted teams of which I’ve been a part.
The five fundamental principles:
- Establish clear objectives and a clear path to measurement. In other words, what defines success in both the short and long term? If you can’t define success, it can’t be recognized.
- Formulate a well-rounded team of experts. This team should encompass each discipline of the company. Encourage them to collaborate and empower them to lead.
- A strong emphasis on accountability. Vital to building trust within a team and across the organization.
- Clear communication and coordination between each discipline of the organization.
- Not allowing egos and emotion to interfere with decisions. Perhaps the most impactful of them all, and it begins from within.
Some time ago, I worked with a seemingly healthy company with a nationwide retail footprint and robust online business. Like many companies, however, they failed to adapt to the changing marketplace effectively and are no longer in business. In retrospect, I see how the failure to apply some of the principles listed above contributed to the decline.
One problem was that the organization did not have an overarching cohesive set of goals allowing each discipline to clearly understand how they contributed to the organization as a whole. Each group (marketing, merchandising, finance, inventory control, etc.) had their own set of goals, and without clear communication and coordination, their individual goals could run counter to one another.
The merchandising team bore the responsibility to improve margin per item sold. One way to do this was to focus on and feature mid-level products or categories that had higher margins. Product selection for emails, catalogs, and stores were primarily based on these product categories. Only there was one problem: generally, customers that purchased mid-level merchandise were the least loyal. We had clusters of very loyal customers whose purchase frequency averaged 9x per year, while mid-level customers purchased 2-3x per year on average. We were, in the short term, improving margin rates but lost focus with the customers that had built the company’s success for decades.
Conversion rates, not customer experience, was the evaluation metric by which the retail team was judged. If a customer came into the store and didn’t make a purchase, it would impact the measurement of store success. With product offering in stores being limited, we often did not have higher-end items in stock in the store. With these stock limitations, sales reps were incented to complete the transaction in the store with lower-tier merchandise rather than ship the desired higher-end items directly to the customer’s home. The unintended consequences of the exclusive focus on store conversions resulted in lower average order values and decreases in higher-end products sold.
The marketing team targeted high-value customers for print communication, although the content increasingly targeted the mid-level market. We tried to make the customers buy what we wanted them to buy, not the other way around.
The finance team dictated the reduction in catalog expense, despite overwhelming data showing that it would negatively impact sales in the long term. I failed to adequately make the case that our decline in customer outreach was adversely affecting our customer retention and engagement rates.
There was a great deal of friction within the leadership teams, and barriers of ego interfered with any real cooperation as departments argued over resources or how to interpret (or ignore) data. Accountability was not encouraged, and finger-pointing was the norm. Culturally the business seemed to lack a long-term purpose.
I also have many examples of incredible teamwork, healthy team cultures, and how that can impact and energize a team.
Recently a group with which I work added email opt-in status to their customer segmentation to align how we target customers through print as well as email. Previously, the print and email efforts were managed by different teams, with very little coordination between them. Through this collaboration, we identified that a small percentage of the active buyer file was opted-in for email, even though we had email addresses for most of them. A breakdown in systems meant that new customers were sent to the email platform, but their status wasn’t updating correctly. In essence, their most recent buyers were not included in the email marketing program.
Rather than play the blame game, we focused on the fix. This technical hiccup was a great thing to find! Ego didn’t interfere, and blame didn’t rest on any one individual. Instead, the focus was on how our efforts helped grow the opt-in email list by 20% (with active customers).
In my experience, the health of a team is a significant predictor in the long-term success of an organization. I’d love to hear how team dynamics have impacted your experiences! Please feel free to reach out to me at email@example.com.