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The Advantages of a Sandbox

I have had the pleasure of spending time with Pat Farrah, one of the founders of Home Depot, over the years. Pat eventually served on my board at Back to Nature. He told me the well documented story of the time he was standing next to a customer in the hot water heater isle. Pat casually asked the customer what brand of hot water heater he had and the customer said that he thought he had a GE. GE did not make hot water heaters at the time.

It struck Pat, so he grabbed a camera and videoed customers entering the store asked what brand of hot water heater they had at home. It turned out 60% had GE. GE owned the market they weren’t even in it. Pat took the video to Jack Welch and the rest is history as GE became the number one hot water heater brand.

Great story, but hard to apply to most business situations as we can’t all go talk to Jack Welch. But to me, the story is that Pat would have never made the connection of GE to hot water heaters without talking to customers in the store. Spending time in the sandbox watching customers, talking to customers, better yet listening to customers is so valuable. We think we know what customers think but we don’t unless we see it and hear it.

The sandbox can be in your brick and mortar store, listening in to calls to the call center, or watching people shop on your online store. This interaction should be focused on listening. Not only can you find opportunities but you can find insight to break down customer barriers.

This sandbox concept is not just for retailers. If you sell a product or service you should find or create a sandbox. Spend time in the sandbox. The feedback gleaned will not necessarily show up on any KPI dashboard but it will undoubtedly eventually show up on your EBITDA number.

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