Discounted Prices Won’t Save Your Store. But THIS Will!
Remember the movie Miracle on 34th Street?
In this classic film, Macy’s was portrayed as the department store whose fundamental purpose was to serve the customer. It was a concept that built their brand and set them apart from discount retailers.
Shoppers used to make a special trip to Macy’s to peruse new items merchandised with care and engage with employees who genuinely enjoyed their jobs.
Unfortunately, as The Retail Doctor points out, Macy’s no longer sees things that way. In fact, the brand plans to expand their off-price brand Backstage to about one hundred locations.
Interestingly, the new CEO of Macy’s believes that he has struck “gold” in the Backstage store model, where products are sold at nearly 80% off.
“What will it take for retail companies to understand discounting more and more merchandise won’t save them? They need to know their customer, carry quality products that are displayed impeccably, and have employees who focus on customer service… .”
Source: The Retail Doctor
The Customer Experience is the New Battlefield
According to VisionCritical, a Gartner study revealed that as of 2016, 89% of companies polled expected to compete mostly on the basis of customer experience—not price—during that year.
That hasn’t changed in 2018. In fact, for many businesses, says VisionCritical, “Customer experience is the new marketing battlefield—a competitive advantage that attracts and keeps customers.”
It makes sense when you consider that today’s customers have more choices than ever before, as well as more opportunities to speak their minds.
To stay competitive, businesses can no longer procrastinate investing in resources that will help them provide a seamless and enjoyable experience for their customers.
Delivering an exceptional customer experience drives profit by increasing brand preference, loyalty, and advocacy.
In Digital Marketing magazine, a marketing specialist at Pegasystems stated that it was time for companies to take action and start providing a consistently positive customer experience. The same article pointed out that customers, not products and services, drive revenue.
One of the reasons a strong customer-centric mindset is powerful, explains author, Elaine Fogel, is its ability to “reduce customer attrition and increase retention.” As long as customers see the value of patronizing your business, they’ll stick around and become loyal to your brand.
Fogel goes on to say that when your business develops a solid reputation for being customer-centric, you’ll be able to attract more leads and referrals and generate more buzz, enabling it to grow.
As VisionCritical points out, revenue-driven companies are investing more and more in the customer experience because it makes good business sense. Dropping your prices doesn’t.
“The single most important thing is to make people happy. If you are making people happy, as a side effect, they will be happy to open up their wallets and pay you.”
As the quote above indicates, people are willing to pay for value. If you don’t want to attract consumers who are only interested in bargain basement prices, leave the deep discounts to other stores and focus instead on offering the best of the best—the best products or services and the absolute best customer experience.
Also published on Medium.