Inventrak Blog

Recently, some economic indicators show good signs for the economy. The consumer confidence index bounced and retail sales began to climb. This is good news for merchants! Consumers are coming back to the market, are you ready to acquire new customers and retain them?

Attract New Customers

Get your store’s name out. The most popular way is to use public media - TV commercial, newspaper advertisement… If your budget is tight, mail promotions (e.g. coupons) and email campaigns can be your cost effective choices.

Another direction to go is to motivate your current customers to bring their friends to your store. For example, you can offer special discounts and services to your preferred customers if they bring their friends to a promotion at your store.

Building Relationship with New Customers

Get to know them 

The first step to build a good relationship is to get to know them. If you are a boutique store owner, do your new clients have any color or style preference? Who would like to come only if they can use coupons? Who are interested in your high end product line regardless of pricing?

The best way to get the answers is to get your customers sign up as your store's members. So every time when they have any purchase activities, your POS system will record their buying trends.  In this way, you will get ideas about who like what.

Offer them what they like 

After you are familiar to your new customers' purchasing habits, take action to keep them back. For example, send a coupon on a new dress in your store to who would probably be interested in this dress; or send emails to your target customers about some promotions designed for them.  

Specials on special days 

In addition, a special gift or offer to your customers on their birthday or anniversary will be great. My friend Ann was so happy when she received a bunch of roses on her birthday from a boutique store. She is now going to the store at least twice a month.  

Are you ready to take action?

You hear the term "Customer Experience" more and more frequently these days. Writers, businesspeople and bloggers like myself have been telling you repeatedly to enhance your customer experiences if you want to thrive in the face of this economic crisis. But do you have a full understanding of what the customer experience really means, and just how to "enhance" it?

Customer Experience? Well that's easy, you say. It's the full experience a customer has with a company, through every channel and each encounter (or something like that). So the question that follows is, how do I improve on that? To enhance the customer experience, keep one mantra in mind:

Take it personally.

The key to delivering the greatest and most valuable customer experience is to make it as personalized to each customer as physically possible. Where feasible, every aspect of their encounters with you should be tailored fit to them. But before you can do this, you need one vital thing: Information!

Detailed information is essential for understanding your customers, and I don't just mean contact info. With reports on your customers' purchases, you can understand

A) Whom your most lucrative customers are and

B) What your customers like to buy.

With this information on hand, imagine the possibilities: Customer-specific discounts, VIP promotions, personalized advertising, email notifications. The list goes on.

But personal information on your customers can prove beneficial too. With a CRM module that registers information such as birthdays, anniversaries and linked customer profiles (spouses, parent and child) you are able to offer personalized promotions, birthday emails, etc.

Remember that a true customer experience doesn't end at the exit sign. I always think of customer relations in terms of romantic relationships: There is the initial courtship, but just because they bought from you before doesn't mean you that you shouldn't remind them that they are appreciated or neglect to make them feel special.

So take the customer experience personally. Your customers will thank you!

Much has been made of the recent changes in the competitive environment for retailers.

Despite today's complexities, however, the fundamental challenge for retailers remains the same-retaining customers.

Below are some tips to increase customer satisfaction and keep them coming back:

Synchronize stock with demand

Customers don't like to be told that you don't have the right size of the shirt or shoes they want. Avoiding this scenario requires real-time stock report solutions. Up-to-the-second stock tracking information is taking the concept of perpetual inventory from dream to reality. This is the basic step to satisfy your customers and keep them coming back to your stores.

Create specific promotion for customer segmentation

From historical transaction data or customer buying habit information, you are able to segment your customers. Based on customer segmentation, you can reach various customers with a promotion specific for their needs.

For example, if you are a boutique clothing retailer, to increase customer visits you can segment your customers into top customers, ones with potential and low-end customers, then create promotions specific for each.

• For top customers, you may offer a private sale.
• For customers with potential, you may offer a promotion to reward them for increasing their visits.
• Low-end customers may receive a simple discount in hopes of prompting a visit.

Create loyalty programs that work

Retailers realize that most their sales are from a small group of customers. These customers are the most important customers, and retailers want to do the best they can to retain them. Keeping track of what loyalty programs work the best, as well as individual loyal customers' buying trends and habits, a retailer can use their loyalty programs do the best to boost their best customers' satisfaction.

All these tips to retain customers can be realized with the right retail IT tools: you can know more about your customers and know what they like the most about you-you can keep your customers happy and coming back.

The retailers that strive to understand their customers are likely to be more responsive to customer demand, spend marketing dollars more wisely, leverage their multiple sales channels more effectively and ultimately drive more loyal behavior from their customers.  

Thus, constructing a customer-centric database from which customer behaviors can be tracked and analyzed is vital to retailers.

A customer-centric database should have at least four subjects listed below:

Customer quality

Retailers want to know who are their best/worst customers. Analysis of frequency and monetary of a customer is always central. By analyzing certain aspects such as time of last visit, sales/margin of his baskets and frequency of visits, retailers can get an idea of the overall quality of a customer.   

Customer Satisfaction

Retailers need to know what customers think and feel about them. Analyzing the feedback from in-store customer service, surveys and call centers helps retailers understand the issues that positively or negatively affect brand impression, shopping experience and overall satisfaction. These data are consisted of structured data (customer attributes) and unstructured data (call notes) that customer service representatives can be mined for insight.

Promotion Impact on Customers

Retailers wish to know what kinds of offers are most interesting to customers and which promotion campaign is most effective. By looking back of the historical data about promotion campaigns, retailers are able to see the campaigns that would mostly interest customers. With modern information technology, retailers can even develop marketing strategy target certain customers.

Loyalty Program

Retailers always do their best to retain customers. They are also eager to know if their effort on these loyalty programs really works. Most retailers are lack of enough customer-specific information to do anything meaningful. For those that have these programs, it is vital to tie transactions and other customer interactions to the customer's identifier. In this way, a retailer is able to tell a loyalty program customer's response to certain loyalty benefits. Comparing customers who are part of a program versus those who are not is a basic analysis to determine the value of the program itself.

With the ongoing economic crisis, strong customer relationships have gone from playing an incredibly important role in the success of retailers to playing an absolutely vital one.

Consumer confidence is at the lowest point it has been in years. In September, retail sales fell 1.2%, the deepest drop they had experienced in over three years. So how do you keep customers buying at your location when they could easily be spending their money elsewhere, or even worse, not spending it at all?

Welcome to Customer Evangelism 101. The key to keeping up sales during rough times as these is not to focus on luring more fresh customers into the store, but rather on keeping your satisfied customers loyal and willing & waiting to return.

Think about it. Customers are less likely to take a chance with a new company or product when money and resources are scarce. The key is to nurture previously established customer relationships, keeping customers coming back for the great product and service they've come to expect from your company. While you acquire the tools to keep these already existing relationships healthy, you'll be learning the skills to "court" other, new customers and keep THEM coming back as well!

But what do you need to do, you ask?

Most simply put:

Know Thy Customer!

If there is one thing that screams "Ineffective!" in the world of retail, it is a company that does not even know its customers. Your customers are assets to your company-treating them as anything but would be an unwise decision. A common complaint of unhappy customers is the fact that the company that upset them has no idea who that customer is. A single view of the customer is unavailable- The company does not follow that customer across various databases (such as catalogs, websites, stores, etc.).

This often means that the customer is forced to supply the vendor with personal information multiple times, making them feel miniscule and forgotten. REMEMBER THAT YOUR CUSTOMERS ARE ASSETS TO YOUR BUSINESS. Would you want to make a potential investor feel meaningless and overlooked? Gaining your customers loyalty and respect will help your business to prosper.

You may be wondering, ‘How can I possibly keep track of so many customers?' InvenTrak's answer is through Customer Grouping, (part of our Customer Experience Optimization package) which gives retailers the ability to categorize customers by analytics (such as revenue generated or items purchased), or by groups the retailers themselves create (such as Season Ticket Holders or Customers from Kalamazoo, Michigan). These choices allow you to follow customers based on hard numbers, (useful for functions like designating VIP Status to a customer) or follow them based on any detail a merchant would like to keep an eye on, like Customers Who Buy Green Shirts (the merchants can hopefully get more creative than that). Regardless of the type of group, Customer Grouping allows vendors to better understand and serve their customers as both valuable assets and real people.

That kind of unique bond between retailer and customer is far more valuable than any marketing scheme or annual sale could ever hope to be.

What are you doing to keep your customers happy and coming back during these difficult economic times?

The latest NFIB (National Federation of Independent Business) Economic report shows that "decreasing sales" is now the No.1 concern for small businesses. A recent LinkedIn community discussion recommended "focusing on your existing customers" as the top measure for dealing with economic downturn . How would you best work with your customers so they will keep their business with you and ride out this storm together?

Bill Dunkelberg is the Chief Economist at NFIB and a featured speaker at the Weather the Economy Forum, a series of webinars dedicated to helping small and mid-sized businesses survive and thrive in a tough economy.

Answer by Eric Kirk; Director of Marketing, Inventrak
Great question Bill! This is not quite the answer to the question you posed, as it does not directly deal with what we as a company are doing, but rather about tools we provide for our clients to maximize the relationships they have with their customers. As a POS/Inventory SaaS provider in the retail space, we have placed a lot of emphasis in the last few months in providing tools for Customer Experience Optimization "CEO".

Retailers in general, and particularly independent retailers, really need to get their hands around understanding their customer base, knowing their customers and understanding the true value of these relationships. With resources being scarce just as it is critical to ensure you have the correct lines and inventory mix on the floor; it is critical that there is a transparent process for management and staff to "value" the customer relationships.
I am reminded of a story about a retailer who actively marketed to their entire customer base, and one day received a note from one of their customers that essentially said, "She was a loyal customer, she shopped at the store regularly but it frustrated her that the they knew nothing about her". She concluded by saying that if the retailer cared about her as they claimed to do in all the email, they would get to know her. In this market, it is more important than ever to really get to know your customer base.

Our "CEO" process includes real time email alerts to store managers advising them of purchases made by customers who meet management-defined metrics on profitability, transactions or sales volumes, allowing store management to follow up with key customer relationships. Identifying customer buying patterns and trends are also part of the standard process, driving customer level promotions based on buying trends and inventory levels are scheduled for delivery in the next few months.

Short answer to what do you do to keep your customers happy and coming back...really get to know them and what they like about you, and optimize their experiences with you.