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How To Sell More Diamonds National Pawnbrokers Association Presents Curtis W. Sutherland Overview History Goals Constant Change – Evolution How to Build the Business Framework – 4 P’s of the Marketing Mix Closing the Sale Curtis’ Top 10 Tips History 1977 – Bought first diamond

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how to sell more diamonds

How To Sell More Diamonds

National Pawnbrokers Association Presents

Curtis W. Sutherland

overview
Overview
  • History
  • Goals
  • Constant Change – Evolution
  • How to Build the Business
    • Framework – 4 P’s of the Marketing Mix
  • Closing the Sale
  • Curtis’ Top 10 Tips
history
History
  • 1977 – Bought first diamond
  • 1981 – Started pawn store
    • Making $1,000 a month
      • Had $200 in the bank
    • Buying & selling on the side
    • Went to gun show
      • $125 – bought 1.25 ctw melee
        • Didn’t know any better – sold it for $500 next day
      • Took $500…
goals
Goals
  • 10 Years ago I was selling 100 Rolex a year
  • Set a goal to sell 150 – sold 160
  • Set a new goal to sell 365 a year
    • Missed that goal, only sold 363 that year ;-)
  • Next year, sold 400..a LOT of work
  • New goal was 300
    • Now sell 300-400/year like clockwork
constant change evolution
Constant Change - Evolution
  • Evolution of personal diamond sales
    • 20 years ago – small melee rings
    • 5 years ago – sold quality 1/2 ct solitaires
    • 2 years ago – sold any 1 ct diamond
    • This year – any 1.5 – 2 ct diamond
      • Only sell ½ ct as 1 ctw studs
      • Only sell melee when we manufacture, etc.
how to build the business
How To Build The Business
  • Pragmatic discussion
  • Will discuss a “framework” that helps us to categorize our approach
framework 4 p s
Framework – 4 P’s
  • Product
    • Selection
    • Understanding market demands
  • Price
    • Objectives
    • Strategies
    • Levels
  • Placement
    • Sales (direct and indirect)
  • Promotions
    • PR, Ads, Direct Response, Events, Online
product
Product
  • What product (diamond) will you sell in a college town?
  • What about New York City, 5th Ave?
  • You must know the market demographics in your area
  • You can expand your market—as you reach out nationally (via the Web)
    • First, learn the business locally
product9
Product
  • Where do you get your inventory?
    • Pawn Loan Defaults
    • Off the Street Purchases
    • Diamond wholesaler vendors who support the NPA
      • Various suppliers
      • Our company (now…with the volume)
        • Specialize in “clarity enhanced”
      • Those that have developed a reliable supply chain
    • Memo (side business)
      • Memorandum, consignment (broker other people’s inventory)
product10
Product
  • What kind of diamonds?
    • Natural
      • Generic “graded” by 4 C’s
      • Branded “Ideal Cut” (meets basic specs)
      • Makes “unique” cut / something different (positioning)
    • Treated
      • Color treated – brown, yellow, green, blue, orange, pink
      • “Clarity enhanced” – graded at the new enhanced level
        • Examples:
    • Key is to find a unique niche that separates you from the masses (jewelers or other pawn stores) where you can be REALLY good. Compete on product, at a unique price…
price
Price
  • Pricing objectives (22 options)
    • Target market share (period)
  • Pricing strategies (cost or market-based)
    • Market-based (what market dictates)
      • Multiple strategies (premium (jewelry stores), bundle, cross-benefit, etc.)
      • Go with penetration pricing
        • Secondary wholesaler (too much competition in retail)
        • Volume will build market share
  • Pricing Levels (actual price per diamond)
    • Retail has a BIG margin and BIG overhead
    • Secondary wholesale, quick turns, low risk (not caught holding the bag), market fluctuates—we flow with it (Dell model)
      • Pink diamonds flood the market, we’ve already liquidated—jewelers are caught with overpriced inventory
      • The shampoo model (rinse and repeat)
placement sales
Placement - Sales
  • Direct
    • Store sales
  • Indirect (Sell through others)
    • Family & Friends
    • Group meetings
      • Church, clubs, neighborhood
      • Speaking events (educational, show & tell)
    • House parties
      • Tupperware & Mary Kay model
        • Educational approach
          • What to look for, how to source, becoming an expert source
    • Help others to become diamond brokers
      • Examples ($40k, $25k)
promotions
Promotions
  • Everything is designed to generate traffic and leads
    • PR
    • Advertising
    • Direct Response
    • Events
    • Online Marketing
promotions14
Promotions
  • PR
    • Donate to the children’s hospital
      • Had an auction – Tickle Me Elmo
      • Radio required to announce public service announcement quota
      • TV station did live announcement
      • Come into the store to write your bid
        • Produced new sales (donations, Elmo)
      • Funds donated to Children’s Hospital
      • Got $25k of PR value (direct sales, advertising)
promotions15
Promotions
  • Advertising
    • TV Ads for 1 year
      • Modest return – break even ROI
    • Radio
      • Live remotes (bring van to location w/DJ’s)
        • Works well with special events and sales
    • Newspaper
      • Classified ads for specific items
        • Great results (sell almost 100% of what we place)
      • Display ads
        • So, so results (hard to track)
    • Magazine
      • Town & Country (island ad)
        • Entire new clientele, high-end for “clarity enhanced”
        • Ad used co-op from Diamond wholesaler (that we used)
        • ROI was excellent – ad only listed one reseller/town (us)
        • Cost us nothing, and produced $12k to $25k single sales
    • Online
      • Craig’s List (free) – sales sections (like classified ads—the item sells (period)). One at a time.
      • E-bay (whole other seminar)
promotions16
Promotions
  • Direct Response
    • Direct mail
      • Sent letter of introduction to 63 jewelry stores in Austin
      • Over the next year, received over $70k in sales
    • Direct e-mail
      • Now do similar, but use e-mail (saves printing and postage)
      • Know who is interested in a specific item
        • Rolex (exact type)
        • Specific diamond size, clarity, etc. (sent out to 50 contacts)
        • Won’t be offended if they get a specific, targeted e-mail (very personal, not spam)
    • Tried door-to-door flyers
      • “nuff said”
promotions17
Promotions
  • Events
    • Mentioned some already (PR)
    • Tried by invitation only sales
      • Worked well, but irregular results
        • First time, sold about $40k that night
        • Second time, sold about $14k that night
        • Third time, sold about $5k that night
    • Put items in live auctions
      • Local and online
      • Put items in at cost, split the profit
        • Don’t want to pay large % on expensive items
    • Business groups
      • Leads group – 1 per type was allowed to present/quarter
        • Still deal with some of the same people met 15 years ago!
        • Revenue equates to apx. $1,500 per hour spent
promotions18
Promotions
  • Online Marketing
    • Ebay & Craig’s list (already touched on)
    • Website
      • Search Engine Optimization
      • Let’s start with
        • A computer
        • E-mail
        • A website
        • Then – optimize it
    • E-mail marketing (covered under direct response)
  • All promotions are designed to generate traffic (leads), however…
closing the sale
Closing The Sale
  • If you have 100 leads and a 0% close ratio…how much will you make?
  • If you have 1,000 leads and a 0% close ratio…how much will you make?
  • If does no good to generate a TON of leads, if you can’t CLOSE the business
  • You either “close” or you will be “closed”
closing the sale20
Closing The Sale
  • The best close, is an enthusiastic presentation (or discussion)
  • The discussion must identify their needs (a bracelet or a ring)
  • To find their needs, you MUST listen
  • Story of Samson..
closing the sale21
Closing The Sale
  • Quoting scripture
    • Samson slew a thousand Philistines with the jawbone of an ass…
    • Every day, a thousand sales are killed with the same weapon
  • SHUT UP… and listen. They will tell you their “hot buttons”
closing the sale22
Closing The Sale
  • Buying Signals
    • A good way to tell if you are listening effectively and personalizing your discussion to fill needs, problems and desires is through “Buying Signals.”
  • Examples of Buying Signals:
    • “How much does this cost?”
    • “Do you think my wife will like this?”
    • “How does it compare to the jewelry store?”
    • “Do you have a payment plan?”
closing the sale23
Closing The Sale
  • Hot Buttons
    • “Hot Buttons” are also buying signals. Always listen for your prospect’s “Hot Buttons.”
    • All needs, problems and desires that are brought up by the prospect are “Hot Buttons.”
    • Examples
      • “Buying here would save me a lot of money”
      • “I could get twice the diamond I planned on”
      • “This is the nicest diamond I’ve seen”
      • “I would be a fool to pass this up”
      • “This should help me…”
closing the sale24
Closing The Sale
  • Hot Buttons
    • Whenever your prospect gives you a “Hot Button,” STOP what you are saying and build upon his “Hot Button” with exciting, positive comments.”
      • Prospect: “This would save me a lot of money”
      • You: “It would, wouldn’t it? The average customer saves over 300% by buying their diamond here. That’s pretty good, isn’t it?”
closing the sale25
Closing The Sale
  • The big How To…
    • ABC of closing (always be closing)
      • Step one
        • Ask for the sale
      • Step two
        • Ask for the sale
      • Step three
        • Guess…
closing the sale26
Closing The Sale
  • Assumptive Close Question
    • Assume the order
      • How would you like to pay for that?
  • Physical Action Close
      • Pen rolls out of your hand into theirs
      • Move over to the cash register
  • Alternative Close Question
      • Would you like to use credit or cash?
  • Subordinate Close Question
      • How are you going to present this to her/him?
  • Key: Have a close question and ASK IT
    • Good idea, isn’t it?
curtis top 10 tips
Curtis’ Top 10 Tips
  • Set goals
  • Start locally
  • Understand “Your” market
  • Find a unique product (clarity enhanced)
  • Consider indirect sales to leverage others
  • Promote with PR and ads
  • Consider direct mail & e-mails
  • Create an online presence (to go national)
  • Don’t be like Samson (jawbone…)
  • Ask for the sale!
conclusion
Conclusion
  • Will everything I mentioned work for you?
  • No…but some of it will.
  • You can grow beyond your current boundaries, meet your goals and achieve your dreams…if you follow this roadmap
  • What’s holding you back?