Over the last few months I have been working with clients in eleven countries. All of them have had economic difficulties. Some retailers are looking at the state of the economy and complaining about lost sales, while others are looking at the same economy and seeing business opportunities.
Some of these retailers are in the same retail sector and it is interesting to see how attitude can make a difference, but apart from attitude there are other important points that create the point of difference. Here are four to start with.
|Avoid confusion, provide value and make your customer’s day, and you’re well on your way to customer retention.
1. Customer service is not the answer
During my travels I came across sales staff who were exceptionally good and others who were just interested in processing me and sending me on my way. Before I left Australia, I presented at a conference where one of the other speakers was Sue Anderson of the Australian Retail Association. She gave an excellent presentation on customer service and why it was not working in many outlets. She introduced the concept of day-makers, that in the new economy the aim of someone in retailing is not to serve the customer, but to make their day. This concept stuck in my mind as I travelled and visited various retailers. It is the day-makers that actually grow sales for businesses.
Making a person’s day is about recognizing them as an individual and listening to their needs. The irony is that you can be a day-maker without having any product knowledge. Day-makers can relate to the consumer and ensure that the consumer leaves the business relationship with a bigger smile than when they entered the relationship
2. Care for your community
In recent months I have seen a shift in marketing. Business are now connecting more closely with their community and helping local causes. This has always been a part of marketing for business, but in recent months there has been a change of focus. Research indicates that consumers want to support local business and especially those local business that support local communities. Caring businesses will be growing businesses.
Retailers and suppliers need to look at the needs and wants of the local community and how they can help improve the local situation. It can be as simple and inexpensive as hosting a fundraising event.
3. Providing the consumer with value
Consumers have started to look for value; many retailers are looking at discount and confusing this with value. More expensive items can provide value to the consumer.
I have just been talking to our local electrician who is doing some work in our office. He mentioned we could go to the local supermarket and purchase some light bulbs. He then followed it up by saying the local electrical shop also had light bulbs that were about 10 per cent more expensive, but would last three times longer. The more valuable proposition is initially the more expensive proposition, but will soon provide a return on our investment. Astute retailers realize that value and discount are two completely separate things.
4. Confusion can reduce sales — it does not always have to be new
While I was in America I worked for some garden centres and they were telling me about the number of new plants that were entering the market. In fact I am told that 75 per cent of plants on sale now in America did not exist 10 years ago. Unless you are a “plant nut” the result is confusion.
One retailer told me of the challenges that he was facing as a retailer. The plant he was offering last year as the best in the marketplace for its type has been replaced by another improved version for this year. If this is happening occasionally then the customer can understand upgrades and improvements, but when it happens at such a rapid and regular occurrence the customer starts to get suspicious and feels this is a ploy to get more money out of them rather than offering an improved form.
As retailers we need to be careful about how we introduce new items if we are to keep building a strong relationship with our customers. This is especially important at present when consumers are looking towards nostalgia items.
Building relationships with consumers should be a high priority for retailers. It is time to invest in relationship building before the customer decides there are less stressful options.
John Stanley is a conference speaker and consultant with John Stanley Associates specializing in perishable retail. Visit www.johnstanley.com.au .