Successful retailing requires a never-ending focus on the customer.
Industry best practice strategies ensure that the customer experience is consistently rewarding, and is aligned with the retailer’s brand.
It starts with knowing your customer segments, and ensuring that buyers are addressing these segments appropriately. Only then can retailers plan to differentiate their offer other than through price, a cornerstone of retail strategy in the current economic environment.
Customer Relationship management (CRM) is the process of:
- Systemising the collection of relevant data about customer shopping behaviour
- Grouping customers into segments with similar attributes
- Executing marketing programs aimed at individual segments
- Evaluating the results, and planning for improvements
Many retailers have invested in CRM systems to enhance their ability to develop more loyalty amongst their customer base. There is a clear payback for this, especially during harder times.
Research tells us that most loyalty programs are ineffective in generating loyalty to the brand. They might deliver discounts or other monetary benefits, but they typically are not discriminating between loyal and non-loyal customers.
More frustrating still is the finding that few loyalty programs utilise the knowledge retailers have about their customer's purchasing history. It raises the question if retailers are too lazy to implement programs that are customised to individual shopper.
Good CRM system implementation ensures that systems are aligned to support business processes, and also support interactions with customers according to customer preferences. CRM systems should be measured in their primary objective of enhancing customer relationships with the business. Of course this means that CRM and Multi-Channel need to be considered together. The best CRM system in the world will not generate good customer relationships on their own. Good retailing practices and thinking is required.
Some key questions for a retailer to know about their customer processes:
- Is the business capturing and then using information about customer purchases to enhance future transactions with the customer?
- Can you contact loyal customers by their preferred method of interaction?
- When customers visit the store, how often are they making a purchase?
- If they don’t purchase anything, why not?
- Is the customer getting the right message across all channels?
- Are channels cooperating or competing to drive sales?
- Are customers advocating the store to their social network?
- Are systems contributing to the improvement of customer satisfaction?
- If not, what should change?
Josem Consulting can provide advice and guidance on the many aspects of enhancing the relationships with a retailer’s customer base:
- Assessment of the current state, with recommendations for improvement
- Performance measurement and benchmarking
- Development of loyalty programs
- System design, Requirements specification, Systems selection, Systems implementation
