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Business growth starts with a ‘Bang’

Posted By Administration, Friday, July 12, 2013
Bob NegenAt TNNA’s recent Summer Trade Show in Columbus, OH, the Retailers Luncheon featured Bob Negen, WhizBang! Training, as its keynote speaker (pictured at right). Negen, who also led two business classes during the Show, gave an entertaining, heartfelt and informative presentation.

He started off by explaining his business roots. In 1981, the recent sociology grad decided "I shop, therefore I can run a store.” He liked to fly kites, and decided to turn his hobby into a retail venture.

His Mackinaw City, MI-based show did a pitiful (even by 1980s standards!) $17,000 its first year. The second year wasn’t much better, and when he was down to just $200 in his checking account, Negen decided to take action. He began with an informal poll.

"I went up and down the streets, asking all the longstanding shop owners in Mackinaw, ‘What do I need to do?’” he recalls. "They told me I needed to advertise.”

Radio Days

Negen decided to put an ad on the radio. He credits 106.7 WKPK (now known as WDTW-FM, Farmington Hills, MI), as taking a chance and working with the fledgling kite shop, even with just a $200 budget. "I still have the cassette of it,” he adds.

Negen and his youngest brother, Steve, decided to do air all the ads their budget would allow on one Saturday: "Mention WKPK and get a free Flippy Flyer” flexible flying disk. They figured it couldn’t miss.

"We open the doors, and we wait. And we wait,” he says. "We gave away two. We spent $200 for $40 in sales.”

On the other hand, Negen says, "it was the best $200 I ever spent in my life. It forced me to do things differently. I learned right then, I couldn’t spend my way out of it. Instead, I had to keep trying, keep learning, keep growing. I learned how to become a successful marketer.”

By 1999, the Mackinaw Kite Co. was worth $3.5 million. Negen and his wife, Susan, decided to start WhizBang! Training and sold the kite shop to Steve.

Get Growing

Negen points out that there are three ways to grow your business:

1. Get new customers.

2. Increase your average sale.

3. Increase the number of transactions per customer.

He is also a big believer in the Rule of Reciprocity (gone over in detail in the book Influence: Science and Practice, by Robert Cialdini). In short, the rule says that "GIVERS GET.”

"Ever go through a set of double doors, and notice how if someone opens the first set, you’re compelled to open the second set for them?” asks Negen. "It’s the rule in action. Social anthropologists contend it’s what separates us from other species.”

To parlay the rule to your business, Negen says, "Start by giving. What can I give my staff to make them want an amazing experience with customers? To get people in the door, to the community? Then we lead with the value proposition: What can you give to make people feel like they want to give money to you?”

It’s what makes us sign up for a two-year contract on a cell phone, join a Book of the Month Club or do other things where we have to give a little first to receive in return. "You may barely break even on the first sale, but you’ll break the bank on the back end,” he says.

Rather than focusing on a margin for every sale, Negen advises, step back at the bigger picture. What is the lifetime value of the customer? If they are happy with the experience a $30 sale brings them, won’t they come back again and again?

"Say that customer who averages $30 per transaction comes in six times a year, with a lifespan of 10 years,” he proposes. "That adds up to an average lifetime value of $1,800. Does it change the way you do business that everyone walking into the store is worth $1,800, provided you do your job correctly?”

With the needlearts, Negen reminded attendees, relationship is king. "You’re not only competing with the big box stores and the Internet, but with the quilt shops, the cookware shops,” he says. "Your job is to create passionate hobbyists. Longevity equals profit.”

Other gems from Negen’s presentation included:

• Throw away your coupons, and give away gift certificates instead. "They treat coupons like trash. They treat gift certificates like cash.”

• Give out gift certificates at networking and social events. "Hate going to the Chamber of Commerce meetings? Next time, walk in and instead of just talking to someone about what you do, ask them ‘Do you know anyone who needlepoints?’” Negen offers. "If they say ‘Oh yeah, my sister does,’ for example, give them a certificate to give to her. The most likely to buy are more likely to buy.”

• Not knowing your shop’s neighbors is a big mistake. Negen advises walking your business district. "Ask people what they do. Put the rule of recipcrocity in play. I can send people to you — and they can do the same. ‘Do you know anyone who knits? Yes? Here’s a gift certificate to give to them.’”

• Instead of a cash donation for a cause, give a group $5 gift certificates to distribute and pledge 20% of their redeemed total sales. Bonus: media coverage through a photo and press release adds to the success for both parties.

• Try an endorsed mailing, where another local business (quilt store, jewelry shop, garden center, etc.) endorses your business in a VIP letter to their customers — with a gift certificate to your store. "What’s in it for them? Their customers are going to think they bought them as a special ‘thank-you,” Negen says.

• Keep competitive store hours. "My wife, Susan, buys yarn at a shop in Minnesota because she works till 6 and the two shops near us close at 5:30. You have to earn the business, stay open late to let people who work late come and spend money,” he says. "If you don’t meet your customers where they live, so to speak, you have that right... but you also forfeit the right to complain.”

WhizBang! offers the "Retail Mastery System” of DVDs with more tips, training, ideas and even template kits to garner more sales for small businesses. For more information, visit

Tags:  business  consultant  crochet  knit  needleart  needlepoint  needlework  Negen  retail  spin  stitch  The National NeedleArts Association  TNNA  weave  WhizBang! 

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