Marketing is Value Creation, Not Trickery

We’re really pleased to welcome a special contribution to the T21 Blog by Charlotte Lynch, Marketing Executive for Modern Retail.

 

“The purpose of business is to create and keep customers, it has only two central functions – marketing and innovation. The basic function of marketing is to attract and retain customers at a profit”

-Peter Drunker

Marketing business sales

It’s fair to say that marketing has changed: with the introduction of new tools, technology and business philosophies, the game has been transformed and it’s leaving many business owners sitting uncomfortably on the edge of their seats. With lots of new products and challenges to business it’s a very competitive time for SMEs trying to market their products. So how does a company keep its customers, fend off the competition and continue to make money?

Spoiler: it’s not about having the cheapest product.

To achieve success companies must go further than just satisfying customers with their products. They need to create a value for consumers that supersedes even the product. And they must, most importantly, be better than the competition at creating value.

Creating Value Through Your Brand:

Of course, the business of retail cannot be completed without it’s core element: the product. Developing the product and brand to create a unique position, to create an individual identity, can have many benefits. An established brand can be particularly helpful in ensuring it remains at the forefront of their customers minds. The verb “to brand” by its very definition is to leave a mark, and your brand should also be making an impression on your buyers. As a marketer of your business you must aim to ensure that these are only positive associations.

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By creating a strong brand you can expect many positive impacts on  your company. It can:

  • Positively affect consumer perceptions of the brand: consumers who recognise your brand and value it will automatically think the best of you. This is seemingly the case in the Pepsi Challenge where blindfolded consumers tried Coca Cola and Pepsi and thought their favourite flavour of the two was Coca Cola, when in most cases it was actually Pepsi. Their unwavering belief prior to the challenge that their favourite must’ve been Coca Cola showed the brand loyalty that Coca Cola had managed to build up.
  • Barrier to competition: if your brand holds a dominant position it makes it very challenging for other competitors to try and break into the market. New companies selling the same products will struggle to get the same traction with your customers.
  • Improve profits: Loyal customers aren’t price sensitive. They come to you for the product, quality and service they receive. Many leading products in their respective markets are by no means the cheapest (e.g. Apple) and they can justify relatively higher prices because loyal customers will continue to buy from them.
  • Provide a base for brand extension: Your customers will be more willing to try new developments from your brand as they trust and value you. By being aware of your customers’ wants and needs, identifying or anticipating opportunities to sell to your customers is much easier.

 

Creating Value From Services:

We all like to be treated as people and your customers are no different – they should also be viewed as individuals. By creating a long-term, mutually-beneficial relationship where each individual customer feels as though they have come away with an array of benefits, more than just the product, you can earn solid customer relationships. These relationships are built through the services given: the way the payment transaction is processed, the actual location of the premises they’re buying it from and, crucially, the people selling the product.

A winning combination of great product and great service can lead to a delighted and ultimately, loyal customer.

Couple at store

 

Example: you sell computers so your actual product is the computer but the augmented product is where you build your customer loyalty. Adding further value through warranties, technical support and delivery/installation (if appropriate), is where the customer relationship is forged. It’s important to note that each customer will place different emphasis on the benefits offered and some of the benefits may be irrelevant to them. One purchaser may be delighted by a warranty, whereas others may already be covered by another policy and so wouldn’t derive much value from it. Your staff should be fully trained to identify how best to help your customers.

 

What Are Services?

Services are intangible: They cannot be seen tasted, touched or kept for later. Your customer will see service as a deed, performance of effort from your brand. Services are conducted in multiple locations by people whose attitudes vary. A service fault (e.g. rudeness), unlike a product, cannot be quality checked and corrected between production and consumption. Good staff selection and training to emphasise standards and expectations can, however, help eliminate this risk.

Your staff are the frontline of your brand: Those who are on the shop floor, restocking, cleaning or selling are the people who are perceived as being the company themselves. Assumed, by the public, as being the face of your brand it’s essential for them to act as a gatekeeper of your brand’s reputation.

It’s one of the many reasons why the selection, training and rewarding of staff is fundamental in achieving high standards and quality service. If you do not pick your staff wisely and train them enthusiastically, you could risk upsetting customers and even other staff members.

Perishability: Consumption of your services cannot be stored for later. If your store is busy and left short-staffed, it goes without saying that the service your customers receive will be affected – and potentially your profitability too. The solution: employee part-time staff for peak times and train your staff in multi-skilling (your staff should be competent in doing different tasks). You could also introduce customer participation (self-service checkouts) or differential pricing (offers at non-peak times). However, if delay is unavoidable you should ensure that a waiting area is comfortable and could even go so far as to provide refreshments.

There’s no argument that your product must still be worth buying and there has to be a balance between product and service quality. But as a small business understanding your customer can be easier and you can learn a lot about each individual customer, which the bigger brands can struggle with. Adding value is crucial in the marketing of your business and using your customers to identify new values you can add or deliver is a great way of identifying new opportunities too!

 

Special Contributor:

Charlotte Lynch

Marketing & Operations Executive

Modern Retail

Modern Retail brings quality editorial from knowledgeable, respected authors to all those with an interest in forward-thinking, independent, high-street retail. The site holds a wealth of invaluable content for owners of shops, boutiques, and all retail outlets throughout the UK.

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www.modernretail.co.uk

Social media links:

https://www.facebook.com/modernretailuk/

https://twitter.com/ModernRetailUK

https://www.linkedin.com/company/modern-retail-uk

 

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