Today, we’re going to look at an important, but often ignored, part of running a profitable business…
… using a couple of enlightening (and very brief) anecdotes from my recent shopping adventures.
Let’s call this lesson: Amazing Little Store vs. Sluggish Giant.
See if you can spot how the following short story may apply to YOUR business…
OK, here we go.
In my line of work, I am required to shop a lot! For everything.
Over the past few months I’ve been doing a study on two markets…or grocery stores…in a city of about 500,000 people commonly referred to as Forest City, although that is not its name.
In Forest City, there is an affluent area which is well served by many retailers; chains and independents.
Now, the Sluggish Giant is a huge place — one of a large chain of other Sluggish Giants — but we are focusing on just one in this story.
It was built with selection and one stop shopping in mind.
As with other huge places, they have a pharmacy, an electronics department, a house wares department…you can get bedding, pots and pans, and garbage cans.
In fact, as I am writing I am hard pressed to come up with anything they don’t have when it comes to everyday needs in the course of running a household.
This Sluggish Giant is clean and modern, well signed, well merchandised (for the most part) and is generally well prepared for the public.
Oh… and prices are reasonable.
They even offer cooking classes and have a fitness club attached; a dry cleaners and a little kiosk where you can purchase a bottle of wine.
So, one could say the ‘product’ was great; product being the building, the offering and the whole store environment.
And, as I mentioned above, the prices are reasonable. I might even say they were good, but not cheap….not a bargain or anything like that.
I do have complaints about the Sluggish Giant, though… but not because of the stuff they sell, the prices or the basics they deliver like a clean and tidy environment, etc.
And I’ll get back to the complaints later on.
Now, let’s introduce the Amazing Little Store.
What a place. Lots of good things to say about The Amazing Little Store, but it is quite small and limited in selection due to its size.
There is no pharmacy, no wine store, no dry cleaners, no house wares or electronics department…you get the picture.
In fact, you cannot buy bleach or pet food there. It is definitely not a one stop shop.
Mr. & Mrs. Affluent of Forest City shop regularly at The Amazing Little Store…often. It’s crowded most of the time.
The shopping carts are miniature versions of the Sluggish Giants’ shopping carts. And they have to be, or you’d never be able to maneuver in the place.
Prices are not over the top at The Amazing Little Store, but they’re higher than usual…for everything.
I forgot to mention they have a small flower shop (with higher priced floral bouquets and arrangements) and a ready to go Sushi stand.
The produce is fresher, bigger and shinier!
Here’s a biggie…they have so much staff in the store it’s almost inconceivable compared to any other retailer.
But they do so much business they surely will not have a wage cost problem. There are 16 people working behind the scenes in the salad area.
Those people are working all day long making fresh salads of all types…and they are selling them like they are going out of style.
A final small delight…you can enjoy a free cup of coffee while wheeling your miniature cart around looking at every square inch of shelf and counter space, lest you miss some new and tantalizing foods.
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Now… here’s where the lesson comes in.
While the Sluggish Giant shines as an overall supplier to the household shopper, the staff and customer service policies are disastrous.
It wouldn’t be possible for any customer to think highly of them.
Certainly, many people shop at Sluggish Giant because it’s a huge market that is close to home and has just about everything they need… but that doesn’t mean they would be loyal if they had another option that provided the same things.
So, watch out Sluggish Giant, your future is probably not so bright.
They want you to do everything for yourself. They want you to use self checkout — where there is always a long line up.
If you do want a cashier to check you through, you will wait in an even longer line up. And here is the kicker…even if you are not at self check out…you will self pack!
That is, they do not pack your groceries in the bags (yours or theirs).
No, they just let the groceries pile up on the conveyor belt waiting for you to get the hint that you are supposed to be performing part of their job.
I can’t go on about this or we’ll never get through this lesson.
They are trying to save labor dollars. Well, good for them. Any well run business would pay attention to costs.
But, even though they are not a ‘no frills’ environment with dead cheap prices, they believe that I am supposed to help them out in their quest for wage savings! Really?
Perhaps they need to do a little more thinking about their business. I’m not inclined to help them and I don’t think many other people are either.
Here’s just one small example — one of many similar things that happened to me in that store …one of my items being scanned by the robotic cashier at the Sluggish Giant was ripped open at the bottom (and it was clear that a customer could not have caused this particular damage) — I don’t want packaged food that is not properly packaged, so I asked the cashier to call someone to replace it.
He nodded. A few moments later, because no one came to the desk, I reminded him.
He said “you should just go and get another one yourself”. (Just so you know, I did not go and get it and there was quite the little upset at that young man’s cash desk.)
And all of this from a fellow with a smock that has “Need Help? — Just Ask Me” emblazoned in huge, bold, colorful letters on his back!
And it just ticked me off that the staff members seem to have taken classes in offending customers. The staff members I encountered all need attitude adjustments.
But, alas, there is no management person, working at Sluggish Giant, who will take care of that. They just don’t get it!
If it weren’t so sad and annoying it would be hilarious!
Hey — I realize this isn’t earth shaking stuff.
You may be saying ‘so what’ if I have to pack my own stuff and ‘so what’ if I have to replace a ripped package (because it’s my fault that it’s ripped???).
But that’s the point of this little story.
It’s the little, lousy ’so what’ stuff that actually leaves the biggest impression.
This got me thinking about customer service delivery.
Over at The Amazing Little Store, the staff members are like long-lost family. The cashiers are always smiling and always make you feel like they are glad you are there.
And, guess what? You’re not going to believe this. They have 9 cash desks and, when needed, 9 cashiers. And what might be the reason for all this?
Well, gee, it’s probably to ensure that customers don’t have to wait in line to exit the store.
They love me!!! They’re happy that I shop here. And… they respect my time!!!
The life-time value of a customer is what counts and this little store has got me for life…or as long as I live in this city.
Remember, it’s not that first sale. It’s all the repeat purchases that build a successful business model.
Good business savvy demands over-the-top excellent customer service… all the way down the line.
It costs you a lot of money to acquire a new customer.
Have you ever tried to figure out just how much it costs, to acquire one new customer, in advertising and other promotional costs? Probably you haven’t.
And you probably haven’t tried to figure out how much of your profit comes from your loyal customers.
Well, at least you should understand that your loyal, repeat customers are giving you most of your profit. Think about it.
Without the loyal customer, who would pay for the marketing and advertising to get the new customer??
I probably won’t shop at Sluggish Giant again. They have what I need but I don’t like to shop there — I don’t FEEL good when I shop there.
They don’t like me or respect my time. Even if I do shop there again, I could never be considered one of their loyal customers.
So it’s worth noting that even a great product, at a great price…can be nullified by rotten customer service.
And it’s also worth noting that another place — like the Amazing Little Store — can leave you with great feelings about the experience, making you want to go back again and again even if you have to stop elsewhere to pick up the other things you need.
Convenience is not top of the list, but that’s ok.
So the perfect mix is: Great product, great value for the money…
… and great customer service.
It’s not brain surgery.
Apart from providing great service up front, if your customer has a problem, they better get personal service fast.
You will never make everyone happy, of course. You’ll always have unpredictable problems that just crank some folks so much it damages the relationship forever.
It happens.
And we’ll always see a very tiny percentage of strange customers who cannot ever be satisfied, because they’re nut jobs. Yes, some people are!
I came up through the ranks knowing that customer service can make or break a project; and a business.
Some businesses out there say “whatever”, and accept huge refund rates because they just don’t want to bother with good customer relations.
I don’t recommend that model. It’s a slippery slope all the way to bankruptcy.
Truly resilient success is built on having a killer product… supported by equally killer customer service.
The customer may not always be right… but that’s the right attitude to start out with when dealing with someone.
It’s a huge lesson. Great product, great service. Anything else just doesn’t make sense.
DMSRetail 
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