Private equity firm Apollo Global Management will take Rackspace private in the all-cash deal.
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Top of mind
Herring also will be watching sales for any signs of a secondary benefit he believes the online training could deliver beyond product knowledge: that of keeping the brand top of mind among store associates. “You want them to feel comfortable not only with the technical aspects of your product, but your brand in general. You want them to think of it first when they are faced with making a recommendation from a number of brands,” he says. “We feel as though we may gain a little competitive advantage from this program as well.”
Even a retailer willing to develop an online training program itself will sometimes allow manufacturers to include product information in the training material-and, of course, let the manufacturer pay the cost of developing that component of the training. The Brick Warehouse Corp., Canada’s largest retailer of home furnishings and consumer electronics under one roof, has turned to online training company InsightU to augment classroom and sales floor training. It’s seen significant ROI since its initial implementation last November, says Mark Laskin, The Brick’s national training director.
InsightU has developed 10-minute online modules to augment classroom and sales floor training. Those modules include content supplied by The Brick as well as by the vendors of products sold in The Brick stores. Where the Brick has indicated willingness to fold specific product knowledge into training, InsightU works directly with the vendor to develop the content and the vendor supports that development cost. The Brick pays for a software-based learning management system, monthly hosting and reports, and some custom content development.
For instance, The Brick along with a bedding manufacturer and InsightU developed an online training module to support the launch of a new mattress in the stores this spring. Had the training been delivered to employees offline across the Brick’s 70 stores, it would not have had the same content consistency as in the single online course, nor would it have been delivered to all of the relevant employees simultaneously as the online course was, Laskin says.
A sales spike
“That product jumped off the sales floor across the country after that module went up, and there’s a direct correlation to the people who took the training,” he adds. “That’s the beauty of e-learning. Everybody can get the same message all at the same time on a consistent basis.” The Brick had a similar experience with a newly-launched DVD system last year; sales of the product spiked and it quickly sold out with the support of an online product training module.
While Laskin didn’t disclose what The Brick pays for its e-training program, a medium-sized retailer with employees in the range of 10,000 might expect to pay about $30 per employee, per year for e-training services from InsightU, according to Kevin Dixon, vice president of business development and partner at InsightU. The turnkey solution includes the learning management system software, hosting and standard reports, and courses that represent a combination of modified, already-developed as well as some custom-developed content. Custom-developed course modules vary in price depending on factors such as the course length and degree of interactivity, Dixon adds.
Even without the vendor input and underwriting it does get, though, The Brick would be an advocate of online training. The Brick, which continues to expand geographically beyond its 70 stores, plans for online training to make education of its increasingly large number of employees more efficient and to bring more consistency to that process.
New hire training at the Brick is a three-week program that combines an online component with mentoring, classroom training and job shadowing. Much of employees’ ongoing training after that now takes place online, and it goes beyond product knowledge training; associates are trained in soft skills, including The Brick’s seven-point sales strategy.
Rewriting the content
InsightU takes the structure of what The Brick had been teaching in classrooms or via job shadowing and re-writes it for delivery in an interactive online program, simulating customer interactions, for example. “The key to it is that the training is totally interactive and enhancing. We think that’s what separates us out,” says Dixon.
The modules are delivered to employees on a regular schedule through the several computer terminals, used in sales, located in the sales floor of each store. Employees with downtime between customers are expected to complete the online modules as they are rolled out. They must receive a passing grade on an online test that follows the material or re-take the test.
Laskin says putting that training online has freed up more time for store managers who previously spent more hours on training. “It’s letting the store sales managers go back to what they are paid to do. We’re a sales organization first and foremost, and the idea is to alleviate some of that responsibility and reshape it so they can be more effective,” he says.
More info = less turnover
Apart from increased sales and managers being able to spend more time on the sales floor, retailers are finding other program ROI. Staples Canada, for instance, reduced employee turnover significantly after instituting online training from InsightU after the retailer identified that the lack of product knowledge was a key factor in higher turnover among store associates, Dixon says.
“They were getting embarrassed and leaving,” says Dixon. “If the associate keeps getting asked about a three-in-one printer and doesn’t have the information, he doesn’t know how to deal with the customer.”
In fact, additional knowledge to deal with customers is another of the benefits that Columbia has identified. “Sales associates don’t like to be in positions where they are asked questions and don’t have answers,” Herring says. “We find that 99.9% of the time, associates appreciate having this kind of information.”