Retaining customers and increasing "share of wallet" are critical in the current tough economy. Consumers spend less, competition is fierce and even well known chains are going out of business. To remain competitive – and solvent – retailers need to develop more profitable relationships with their customers.
Moreover, a recent Nielson Company study showed that 52% of shopping trips are quick excursions. So, how can retailers develop meaningful customer relationships amidst short, transaction-oriented interactions in a down economy?
Building Customer Profiles
A POS system with integrated CRM allows the retailer to capture and develop a detailed profile of each customer. The profile starts with simple contact and demographic data: name, address, phone, e-mail, gender and birth date. This can be augmented with additional data such as anniversaries, family members' birthdays, etc. This data can then be matched to the customer's purchasing history to build a deeper understanding of that customer's needs and preferences.
Most CRM modules are customizable, so you can create your own layouts to reflect the fields of information most relevant to your business. For example, apparel retailers might collect the customer's preferences for certain brands. The cashier can then input the information quickly and accurately in the POS system during checkout. This also gives your employees a chance to personalize the customer experience by referring to certain customer information when appropriate.
Understanding the Customer
Using your customer database, standard or customized reports can be generated to analyze purchase habits and customer statistics in order to support marketing campaigns. Any field of data that is collected can be used at the point of report origin. For example, with a few clicks of a mouse, a personalized customer report can be generated for:
- Specific item preferences
- Dollar purchase analysis
- Preferred days to shop
- Purchase history
- Birthdays and anniversaries
Building the Relationship
Using customer reports, there are many opportunities to get your customers back in the store and grow share-of-wallet. Is there a customer who hasn't been in the store for a few months? Send them a personalized note with a coupon attached. Have an overstock on a particular item? Generate a report of customers who have bought similar items and send them an e-mail or postcard offering a special deal.
In addition, personalizing the shopping experience leads to customer loyalty. A simple birthday card and associated discount is a great way to remind customers you want to see them again. The extra effort on your part will be rewarded, as marketing ROI is typically much higher with repeat customers than with new customers.
A good CRM solution can use control groups to calculate the effectiveness of a particular campaign and create simple but powerful metrics that can measure the profitability of your business. These benchmarks measure performance and quantify the areas that work, while alerting you to areas of concern.
Summing it All Up
In a tough economy, every retailer will be challenged to maintain profitable customer relationships. Adopting the CRM capabilities in a modern POS system will help you stay closer to your customers and maintain winning relationships.