Filed under: Customer Experience
A Jaguar.
A Mercedes.
A BMW.
Can you guess where I am? A high-end car dealership would make for a very logical guess, but you would be wrong. Sorry. Maybe a Simon and Garfunkel reunion concert at the Excel Energy Center? That would be a more creative guess—and creativity counts for something, I suppose—but wrong again. How about a Minnesota Timberwolves game? Possibly, if this were five years ago when people went to the games. Give up? I’m actually standing in the parking lot of a discount retail chain.
Once I started digging into this phenomenon—it’s a retail trend called trading down—I guess I shouldn’t have been as surprised as I initially was. Most of the discount retailers have been thriving. In the third quarter 2009, sales were strong for the discount store group overall, with particularly good results in the off-price sector. Moreover, a few analyses of off-price retailers show they’re actually doing better as the economy worsens.
But the economy is improving, right?
Well, that can obviously be debated. And boy, we all hope so. Or do we? An improving economy could bring with it some challenges for discount retailers who are benefitting from the influx of new customers hungry for bargains. So what does this mean for them—a potentially improving economy? It means that the time is now, that the window to turn these new customers into loyal followers is closing.
Discount retailers aren’t much different from other retailers, really. In the end it’s still about product, service, and environment. And it’s still about executing those three things consistently across all stores.
For discount retailers who are worried about the fading recession, I would say now is the time to truly understand your different customer groups and what they expect from your brand. Now is the time to continually measure each touch point in the customer experience and refine operations to meet the expectations of new and existing customers. Now is the time to build a fan base and understand what motivates different types of customers to choose your brand. Now is the time to capture as much of your customers’ share of wallet as possible.
Because the old adage is true: what gets measured gets done.
And because, hopefully, the economy is getting bullish…and soon.
– Joseph Stanton, VP Business and Product Development
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Remember also that people are creatures of habit. Once they learn a new habit they will continue until something makes them change. So learning to park in the same area in a discount shopping center and learning the layout will bring them back as long as the products are priced appropriately. They initially forego the customer service aspect but will dorp this new experience fast if not being served properly. Price will not be everything once the confidence level of consumers returns.-
Comment by Uncle Buck December 24, 2009 @ 4:16 pm