Airlines didn’t invent customer loyalty programs. The first ones were developed for grocery stores in the 1950s. Many of us remember pasting pages of S&H Green stamps into books and going to the redemption centers with our moms to choose between coffee makers and camp stoves. In fact, loyalty programs have become so ubiquitous that a Fair Isaac study showed that only 22 percent of next-generation shoppers find the programs important in creating repeat business. Still, according to Jupiter Research, more than 75 percent of Americans have at least one loyalty card. Forrester Research and META Group Inc. suggest that since many loyalty programs really trade
Shopping is no longer the sport it used to be. Today’s time-starved consumer no longer sees shopping as a leisure time activity. Buyers horde their free time even more than they hold on to their disposable income. Time has become the currency of the 21st Century. A number of studies show that consumers’ time for retail is tightening. In her study, How America Shops (2002), Wendy Liebmann of WSL Strategic Retail found that while the average shopper in 2000 frequented 2.9 outlets per week, two years later it was only 1.9 stores. Paco Underhill, founder and CEO of Envirosell, Inc., and author of Why We
Customers can buy the same products you sell from dozens of other local and national retailers and on the Internet. So, why would they buy from you? In his book, Why Should Someone Do Business With You…Rather Than Someone Else?, Sam Geist first explored the importance of analyzing the drivers that lead customers to choose one dealer over others. You may be making a huge mistake if you aren’t continually trying to find out why consumers do—and do not—buy from you. Buyers ask the question hundreds of times in the course of making a major purchase. Look at the places you frequent—your favorite stores or restaurants.
A few years ago, I asked 40 different industry suppliers to list their best dealers. I also asked them what characteristics made those dealers the best. Almost all vendors said that their top dealers were those who had developed best practices in a number of key areas. Google “best business practices” and you’ll find hundreds of pages of articles on the topic. Focusing on best practices has become the latest mantra of business gurus, but the process of defining and implementing them can be complex. They vary from business to business, and they are always rooted in a company’s core values. For instance,