See how converting loyal customers into into brand advocates increases your income

I've worked with retailers over the years and a recurrent theme is the question of how to reward customers. I've looked in this blog at different ways of rewarding your team but having ways of rewarding your customers can help to transform a retailer. This is a large subject so I've split it into two blog entries. The first one is today.

A constant theme of my blogs is turning customers into loyal customers into brand advocates, so it's probably best to start here and explain what I mean by these three categories-

Customers

This is simply people who buy something in your shop. They may be passing by and see something in the window, they may be a visitor to your town and come in to have a look around. They may shop with you once and never again. This doesn't mean that these customers are unimportant. You will need one-off customers and irregular visitors to help your sales. They can be attracted to your door by promotions, a great window display or word of mouth. However they arrive is unimportant. The fact that they got to you gives you a chance to impress them and get them coming back time and again. This turns them into the next level, the loyal customer.

Loyal customers

A loyal customer is one that chooses you over another. You may have one or more stores in your town that sell the same thing but your loyal customer will buy from you over your competitors. You can create loyalty with price, promotion or excellent customer service as well as other means. Supermarkets in particular fight for loyalty and this has sparked the loyalty card and the price matching over the years. A loyal customer will return to you over and over again unless something happens in their relationship with you to break the loyalty. It's a well-worn phrase that it costs so much more to win a new customer than to keep an existing one and that's the relationship that loyalty projects attempt to protect. Many businesses stop here. Having a band of loyal customers spending good money with you in a regular basis, plus the odd infrequent customer can be a lucrative proposition. But I propose looking to the next step.

Brand advocates

And I strongly believe that brand advocates are the next step for a retailer to increase success, and in a more interesting way. The ways in which you can achieve this will be the subject is the second part of this topic and my next blog entry. Today I'll describe what a brand advocate is and the effect they can have on your business. A brand advocate is someone who goes out of their way to tell other people about you. It may be one of several ways of doing this-

• Bringing their friends into your store
• Talking about you on their blog
• Positive social media comments about you
• Telling people face-to-face about how great you are

The brand advocate is a marketing tool that you can rely on to bring you more business and all it costs is a great relationship with them. Having several brand advocates starts the cycle off again for the next set of customers. They arrive at your doorstep because of a brand advocate, and you will hopefully turn them into loyal customers and the next brand advocates. How you start this relationship and maintain it can be interesting and fun, and we will take a look at that in the next blog.

See why inflation figures heighten your need to compete on things other than price

The latest inflation figures were announced this week and it's not good reading for retailers-

http://www.bbc.co.uk/news/business-34514135

The figures show a fall in the inflation rate to it actually showing a negative. This means that prices are falling.

Why is this bad news for retailers?

This is particularly bad news for retailers of high price items. The fact is, that if consumers see prices falling they will put off their large purchases in the expectation that prices will continue to fall and they can save money. This effect really starts to kick in when prices fall consistently over a longer period of time. It works more on high ticket products - televisions, cars, gadgets and computers. So if you're a retailer of these items what can you do? The first thought when looking for customers is often price but that seems like the wrong idea on this occasion. Further price cuts can only deepen the feeling that prices will continue to fall. And increasing prices at this point will put you at a disadvantage to your competition.

So the best thing to focus on is the quality of what you sell. Having a quality product can sell no matter what the market is doing. Look at Apple - their products sell in times of inflation or deflation. Now, we can't all come up with an ipod, iPhone or iPad idea to help our retail business but you can focus on the quality in your own business.

Finding what makes you different

As a retailer you will probably already have an idea what it is that makes you different. It's what sets you apart from other retailers and it could be one of many things-

• Your loyalty scheme
• Your products
• Your customer service
• Your special offers
• Your events

I've written many, many times in this blog about understanding what you do better than others. And this is what you need to concentrate on. I'll give you a few examples-

Waitrose have high prices but their customers love their absolute quality and great customer service.

Boots are very pricey but focus on their loyalty card and customers return.

Aldi mixes price with availability and customers have loved this balance.

So what is your USP? What can you do better than your competition? What are you capable of that nobody else in your town is? These are the things that will drive you forward.

Communicate this with your team, communicate it with your customers and look away from just dropping your price to compete - there are other, better ways to differentiate yourself.

Looking back at 100 blog posts - part 1 - The High Street

As I look back at the blog, and the 100 posts that have come before, I will take the next five blog entries to look at the themes that have emerged during my time writing this.

One of the main motivations for writing this blog was the decline in the UK High Street, and what could be done about it. Although the blog hasn't focused on that completely, I have returned to that subject time and time again. I think that some of my blogs have been about comparisons, some have been moans and some have been looking at ways of stimulating the High Street again - not to it's former glory, but to a modern-day vibrant place to shop, eat, park and spend leisure time.

I looked in an early blog about how to make the most of the customers you have through your door when on the High Street. The key to your customers that are against the clock is speed of service. On the High Street, as a pose to those shoppers at out of town retailers, there is the pressure of time. This typically comes from parking charges and the fact that a lot of your customers will be on their lunch break. The blog below looks at preparing for this and being ready.

http://mytimeinretail.blogspot.com/2014/02/speed-of-service-is-key-for-most-high.html

I have tried to tread a fine line on this blog between protecting the High Street, but not at all costs. I think that retail has to adapt to it's surroundings and move with the times. Modern retailing has embraced the online offering, often matching it with the ability to Click and Collect. In this blog, I looked at the modern High Street embracing the advantages technology could offer.

http://mytimeinretail.blogspot.com/2015/01/you-can-have-online-offering-and-not.html

And I wondered in the blog below if there is a major retailer that would take up the plight of the High Street and become a true champion. I think that a big retailer should look after the smaller independent retailers around it. A vibrant High Street or town centre is a benefit for all who live near, shop there and have an outlet there.

http://mytimeinretail.blogspot.com/2014/05/is-it-time-for-major-retailer-to.html

After a visit to Italy, I briefly looked at the differences between the two shopping cultures and the two shopping areas created and used by us and the Italians-

http://mytimeinretail.blogspot.com/2014/02/comparisons-of-uk-high-street-to-that.html

NOT EVERYTHING CAN BE BOUGHT ON THE HIGH STREET

A return from holiday leaves me needing a catch-up

I've now returned from three weeks holiday. A three week break brings lots of thinking time but the return to reality and activity is tougher than I remember.

I've kept physically active whilst away, with a gym and swimming pool on the complex I've been staying on. But a lot of time on the road, by the pool, in the gym and on the beach gives you plenty of time to think about what you are doing and where you want to start going next with everything you do.

I think that it is good (and it was good) to have a period of reflection and contemplation. It gives you a chance to determine whether you think that you're on the right track and to plot the way forward without the everyday distractions of work life. It also enables a little "blue sky thinking" as there exposure to a different routine and a different culture can have you thinking about things in different ways. I have looked at the direction I'm heading in and I broadly think that it's where I want to be going.

It's now thinking about heading out of the break and back into my life that's occupying my mind. I landed and got home in Sunday evening and it was back to work at 7.30am on Monday, so there was no real transition to be had. It was a case of holiday mode as is went to bed and work mode when I got up the next morning. It was just the way it had to be with three weeks off - there was no spare time to be had! So it was straight back into it, which can sometimes be the best way to get on, although I don't really feel like that the the moment! I can just about see the wood from the trees at work now, after a few days of catching up. I just wish I could say the same about everything else I do.

It's getting back into the swing of things for everyone concerned at the moment. The Summer customer flow is very different to the flow during the rest of the year, especially in a university city, such as the City of Durham that I work in regularly. So it's been a time where large parts of the city have been on holiday and where large parts if the city are starting to get back into a routine for Back To School promotions, the kids actually returning to school and the university students returning to the city.

I've been doing some work with a pharmacy in the city recently and all their work is geared to the students returning and the ailments beginning, especially when the weather turns cold. The start of term can't come quickly enough for them and their largest customer base starts getting ill not long after returning.

It's interesting to note where your largest customer groups are and how the ebb and flow to be able to plan out your staffing, stock and things such as opening hours. I've mentioned in my blog many times about organisation, and this is adding another level to your understanding of what goes on.

NOT EVERYTHING CAN BE FOUND ON THE HIGH STREET