1. Poor Communication
Often sales are negatively affected by poor communication between teams. it’s important to have a seamless relationship between marketing and merchandising teams to make well informed strategic decisions to maximize sales performance. Poor communication between the teams can lead to misaligned product and advertising strategies. For example, if the marketing team is investing a disproportionate amount of advertising spend on items at too low of a price point, the merchandising team may not be prepared for the surge in demand, which can lead to stock outs and lost sales.
It is important for teams to have aligned goals and to make decisions with the same information. To result in better-informed decisions and help integrate workflows effectively to help increase sales, it is important to have a single source of truth,
So You can actually increase your sales by encouraging you team on how to work together to synergies.
2. Lack Additional Value
Not providing enough additional value, can be another reason your sales are declining. Perhaps, your competitors are providing more incentives than you, such as free shipping or free returns. According to Forbes, free shipping is the incentive 88 percent of online shoppers want the most. If you and a competitor offer some of the same products, but they are offering free shipping, you may lose out on those sales. To ensure you never miss out on an opportunity to increase sales, keep an eye on what competitors are offering to help you match that.
Loyalty programs are another way to ensure your customers continue to return. By providing incentives to shop at your store, you can create customer loyalty. Loyalty programs are only effective when customers know how to earn points, what the rewards are, and how close they are to reaching a reward. Implementing a successful loyalty program can create many benefits, including a bump in sales.
3. Price
Price has a good influence In essence, a high price can maximize short-term profit, while a low price can maximize long-term profit, as it generally attracts more customers and helps the business gain market share. Price can also be a determinant of a brand’s positioning and quality. If a product line launches with a high price, it suggests high quality and prestige.
A price change on a price sensitive product can reduce sales. Therefore, measuring a product’s price elasticity is important, as it will help you determine how sensitive demand is to any price changes. By testing pricing strategies, you can maximize sales and margins at the highest price consumers are willing to pay.
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4. No money, no sales
I’ve always wanted to own an original Rolex watch. I don’t just need it; I want it. I desire it.
I am absolutely qualified to own this product but I don’t have the money for it; I just cannot afford it.
Although I hate to admit it, I am not the type of customer a Rolex watch seller wants to see. No matter how much I love and adore the product, what use am I to a Rolex watch business if I don’t have the money in my pocket to buy one piece?
Unfortunately, a lot of businesses are facing this same problem.
Everybody tells you that your products are beautiful and amazing but nobody is bringing out their wallet to pay for them. Even when there’s a serious need for the product or service, some businesses still find it hard to sell their products to enough customers.
Why would this happen? Here are a couple of reasons.
Too expensive – If your house was infested with rats and I offered to sell you a product that would kill all the rats in an instant, would you buy it? Of course, you would!
However, what if I told you the price of this product is $10,000? What?! To kill rats? I’m sure you’ll take one day out of your busy schedule to ‘manually’ kill all the rats yourself or find much cheaper alternative.
Even when the need is there and the product is right, a high price can spoil a sale. For most people, price is a sensitive issue. If the price is too high, they won’t buy. Period!
Wrong market – If you set up a Rolex watch business in a low-income neighbourhood, what do you expect? Most poor and middle-income people may strongly admire a luxury product but they cannot afford it. That’s why location is a very important factor in setting up any business.
If you’re surrounded by people who cannot afford to buy the products or services you’re selling, then you’re definitely in trouble. As an entrepreneur, you must target not just people who have a need for your product but who also have the money to pay for it.
Bad timing – If you don’t understand the buying habits and patterns of your customers, you may just be selling to them at the wrong time. If you want to sell equipment to a large and established company, you should know that the best time to do this is just before their budget for the year is decided.
Good timing particularly works well as a sales strategy for customers who plan their spending.
Recently, I learned an interesting lesson about timing from my kid sister who sells clothes and shoes to her fellow students at university. She tells me that the best time to sell is just when students return to school after the holidays. At this time they’re still flush with cash and are more likely to buy from her. Of course, as the semester advances, sales drop.
5. No hurry, no sales
Have you ever wondered why you see those adverts that say: “Buy now at 40 percent discount. Offer valid for 30 days only!” ?
Procrastination is one of our oldest habit and a fundamental part of human nature.
Even when people see something they like, they may likely not buy it now and will most likely prefer to wait for later.
The longer they wait, the lesser the likelihood that they’ll still remember or even buy your product at all.
Because people are likely to postpone a buying decision, they often need to be encouraged to take action and buy now.
By creating a sense of urgency to buy your product or service, customers have a reason to make a decision immediately and reach out for their wallets.
When you use hurry as a sales strategy, you also create an impression of scarcity for your products. Nobody likes to miss out on a good offer. Almost everybody likes to take advantage of a discount to enjoy a product or service at a lower and cheaper price.
Nevertheless, there are a few ways to use the ‘hurry’ strategy to achieve the greatest effect. Here are a couple of ideas.
At start up – Hurry is an effective way to create awareness about a new business and start making sales as soon as possible.
New product launch – If you are already in business but have just introduced a new product or service to the market, the hurry sales strategy would also work well for you.
Offering the product for free or at an attractive discount for a fixed number of days will give your customers an opportunity to try out the product. If they like it, they’ll still keep buying even after the deadline for the ‘promo’ has expired.
A good point you should keep in mind is that you should always use the hurry strategy with a fixed (short) deadline. Why would anyone hurry to buy if the discount is permanent?
You should also make sure that you’re not being too pushy. The aim of using the hurry tactic is to encourage people to make a quick decision to buy from you rather than procrastinate. When you’re pushy, most people become defensive and may just never buy from you again. You just need to be cautious when you use the hurry tactics on your customers