Customer/Business Relationships Are More Then A Friendly Smile.
At a new launch in a very proud family owned cafe today, a customer/local business owner came in and said “I WOULD NEVER HAVE A “SHOP LOCAL” or “CUSTOMER REWARD” PROGRAM… IT SHOWS WEAKNESS IN YOUR BUSINESS. I DON’T WANT CUSTOMERS THAT I NEED TO INVEST IN… MY CUSTOMERS SUPPORT ME; NOT THE OTHER WAY AROUND.”
Not only has this person just caused a very negative scene, but she made it very clear that Local Support is Expected without any thought of giving thanks to her supporters…
The marketplace is changing and being Local is not what it used to mean. A higher percentage of shoppers are following a trend of purchasing online at prices that continually seem to sink in a cutthroat game of “Who shows up on Google Search First”. Online shopping takes little effort by customers and purchases are showing up at your doorstep within days….
HOW CAN A LOCAL SHOP, WITH A REAL DOOR & REAL SERVICE COMPETE?
That “Real Door” has way more value then you think and businesses need to grasp a “Give A Little to Gain A Lot” focus on Marketing! When someone comes into your store there is HUGE OPPORTUNITY for you and your employees to illustrate a personable side to your business, build & react to the emotions your customers are displaying while also using your “retail space” to up-sell another product that was never on the customers radar. Having real people in your store means a higher percentage of happy customers the first time; without having to wait for shipment to decide if the color or sizing is correct.
Besides, you are paying wages to staff and rent to have a storefront; why not make the most use of its massive opportunity! This realization has led the largest businesses in the market to spend a large amount of time, effort and money into a physical sale while driving customers into the store; And most recently, there has been a shift to monopolizing/combining rewards with other peer businesses to capitalize on Customer Reach.
CONSIDER A COUPLE VALUE POINTS
1 ) What is your Current Margin Target; Do your customers make multiple purchases?
If you have 1000 sales at $10 each with a 10% profit margin, you would expect to make $1000.
WHAT IF YOU GAVE 2.5% GROSS SALE VALUE AWAY AS DISCOUNTS FOR A CUSTOMER TO COME BACK A SECOND TIME AND ONLY HALF THE CUSTOMERS CAME BACK FOR A SECOND PURCHASE?
1000 sales at $10 Each $1,000
$10,000 * 2.5% – 250
500 sales at $10 Each + 500
By giving away 2.5% you actually increase your profit by $250 in a year! Did you know that Customers actually shop in stores 4X more if the store has a rewards program. SO THIS BUSINESS COULD ACTUALLY EXPECT TO ALMOST DOUBLE PROFIT BY GIVING AWAY 2.5%!
2 ) How do you Fit in Among your Business Peers & How can you Leverage a Neighboring Customer Base?
Don’t be naive. It does not matter how great any one business is, it will never have exclusive access to customers. Price is the #1 driver for customer purchases among similar products & this is very necessary for a healthy marketplace…. So how can you keep customers coming back during a competitors sale? Let’s consider a recent move by Canadian Tire. The Canadian Home Supply Giant recently announced its “Triangle Rewards” program that is available at numerous locations outside Canadian Tire, and some of these locations also sell products that directly compete. WHY YOU ASK?
CUSTOMER SHARING! Even the biggest retail locations feel the effect of customers “Jumping Ship” for other low prices. If they offer rewards that “cross parking lots”; they can generate more profit opportunity and stop slashing prices!
If a Customer is Loyal to the competition but has the opportunity to earn Points/Value in your store; they will make a trip your way. Add that to the fact that your business is Locally owned & you have a winning combination for success against the largest of national stores with a Locals Touch!
Moral of the Story: CUSTOMER REWARDS WORK FOR ANY SIZE OR CLASS OF BUSINESS.
Today’s customers value a relationship that mutually gives and takes. Don’t un-intentionally (in-advertently) turn clients away by feeling that your business and its status has something to prove. After all, World class Franchises like Starbucks who thrived on the exclusivity and elite pricing for coffee have now introduced loyalty programs to help motivate the new aged customer… There is no “one size fits all” solution to any consumer rewards program BUT not showing your thanks and failing to target groups of shoppers that support you the most is a dangerous line to walk in a world of “Super Sales” that may be taking place half way around the country!
Local Reinvestment Incentives, Demographics, Promotions, Networking!
Small Business; Digital Loyalty and Gift programs For Locals, By Locals!