Feedback Loop
Tell any group of retail sales associates that “the customer is always right” and you’ll probably inspire some heated debate. Let’s face it: Sometimes, the customer might be wrong — very wrong. And salespeople not very concerned about job security can be quick to let those folks know just how wrong.
What’s not debatable is that consumers are constantly providing voluntary and involuntary feedback about their needs and wants. Used correctly, this data can provide a sustainable competitive advantage, while driving sales, profits and loyalty.
This information proves once and for all that the customer is truly “always right.” Whether they know it or not, their actions dictate decisions being made daily by the companies they shop. Retailers and manufacturers are pressured to identify a differentiator separating them from the competition.
Here are five tips to put you on that road to success:
- Commit now
Rome wasn’t built in a day and neither is a consumer-centric strategy. Early adopters are already busy deploying insights across the organization and putting the data to work in real live situations.
- Put the data to work
Having a wealth of data is one thing. But having the capability to use that data to drive chain-wide marketing and merchandising decisions is the true key to consumer centricity. More than one-third of retailers surveyed by IDC Global Retail Insights for DemandTec and Precima said they are unsatisfied with their ability to leverage and execute using consumer insights.
- Create a culture
The commitment from the C level should be absolute from the get-go, establishing the right data, tools, processes and communications on day one. A key step in creating a culture of customer-centricity is change management — implementing the necessary changes in process, organizational structure and employee performance indicators.
- Update the metrics
Retailers embracing a consumer-centric approach must combine the traditional metrics of sales and profits with new measurements reflecting the performance of consumer-centric strategies. While a nearly unanimous 92% are measuring “increase in overall sales dollars” and 92% also count the “increase in total number of customers” figures, only 72% are monitoring the telling “increase in customers in valuable segments” and just 80% are measuring “per-customer profitability.”
- Collaboration is critical
High-performing retailers (at least 7% year-over-year same store growth) are keen on the advantages of sharing data.; 47% say it allows for better insights; 53% say that it strengthens the retailer-manufacturer relationship. While these numbers are encouraging, at just around 50% they indicate that the potential is still under-realized.
Brian Ross ([email protected]) is general manager at Precima.
