OFA Short Course (July 2012) Current Challenges Facing the Industry 1.Weather Conditions 2.The Economy 3.Identifying & Connecting with Customers 4.Slow

OFA Short Course (July OFA Short Course (July 2012)2012)Current Challenges Facing the

Industry

1. Weather Conditions2. The Economy3. Identifying & Connecting with

Customers4. Slow Traffic5. Declining Retail Customer

Counts

Why Businesses Lose Why Businesses Lose CustomersCustomers1. 68% - Unhappy with the Treatment

they receive2. 14% - Dissatisfied with the Product

or Service3. 9% - Begin doing Business with the

Competition4. 5% - Seek Alternatives or Develop

other Business Relationships

5. 3% - Move Away6. 1% - Die

Source: US Small Business Administration & US Chamber of Commerce

Customer Relationship Customer Relationship Management (CRM)Management (CRM)

Customer relationship management:A systematic tracking of consumers’

preferences and behaviors over time in order to tailor the value proposition as closely as possible to each individual’s unique wants & needs

CRM facilitates one-to-one marketingCRM systems use computers, software,

databases, and the Internet to capture information at each touchpoint.Touchpoints are any direct interface

between customers and a company (online, by phone, in person, etc.)

CRM References CRM References

“Principles of Marketing” by Phillip Kotler and Gary Armstrong

“Real People, Real Choices” by Michael K. Coolsen and M. Patricia Galitz

“The Australian CRM Market” by David Sims

Value and SatisfactionValue and SatisfactionPerceived Value

The customer’s evaluation of the difference between benefits and costs.

Customers often do not judge values and costs accurately or objectively.

Customer SatisfactionProduct’s perceived performance

relative to customer’s expectations.

Four Steps in One-to-One Four Steps in One-to-One MarketingMarketing1. Identify customers and get to know

them in as much detail as possible2. Differentiate customers by their

needs and value to the company3. Interact with customers; find ways to

improve cost efficiency and the effectiveness of the interaction

4. Customize some aspect of the products you offer each customer

7-7

Capturing Value from Capturing Value from CustomersCustomers

Customer Loyalty and Retention

Share of Customer

Customer Equity

Customer delight leads to emotional relationships and loyalty

Customer Lifetime Value shows true worth of a customer

Key ConceptsKey Concepts



Share of Customer

Customer Equity

Share of customer’s purchase in a product category.

Achieved through offering greater variety, cross-sell and up-sell strategies.




Share of Customer

Customer Equity

• The combined customer lifetime values of all current and potential customers.

• Measures a firm’s performance, but in a manner that looks to the future.

• Choosing the “best” customers is key


ButterfliesGood fit between

company’s offerings & customer’s needs: high profit potential

BarnaclesLimited fit between company’s offerings & customer’s needs: low profit potential

True FriendsGood fit between

company’s offerings & customer’s needs:

highest profit potential

StrangersLittle fit between

company’s offerings & customer’s needs: lowest profit potential

Short-term Customers Long-term Customers

Projected Loyalty

Potential

Prof itabi l ity

High Profitability

Low Profitability

Not All Customers are Equal

Some CRM Offerings Some CRM Offerings 1. Fusion Line of

Integrated Solutions

2. Cam Commerce Retail Star

3. NetSuite Multi –Channel Retail Mgt Suite

4. Epicor Retail Solutions

5. Counterpoint by Radiant Systems

6. NetSuite

7. Act by Sage8. Amber POS9. Merchant OS10.Microsoft Retail

Management System

11.ALMsi12.Vend POS13.MultiFlex RMS

Fashion 14.Salesforce.com15.Sugar CRM

7 Steps For Building Long-Term Relationships With Your Best Customers

1. Concentrate on getting the second sale

People are only customers if they buy from you regularly. And many people will buy from you once and never again.

To turn someone into a genuine client, the most important thing is getting the second sale from a new customer - and getting it as soon as possible.

After that, they are more likely to stay with you and build the relationship.

Source: Robert Greenshields


2. Always act in their best interest People are more likely to do what you ask if

they believe you have their best interests in mind. This is the 'Law of Friends'.

To build a business relationship, show clients that you are looking after their interests.

This trust can normally only be built over time. Stop worrying about getting clients to like

you and focus on looking after them. Don't be interesting. Be interested. That helps you

think of them as individuals. ('Built to Last' by Jim Collins)



3. Keep in touch regularly

You can build trust by giving valuable information - rather than simply promoting your services. Newsletter Social MediaYouTube Podcasts and teleseminarsPostcards



4. Make your contact personal

To make your contact with customers personal, you need to learn about them.

Start by just listening to themPost a survey on your website or conduct a

customer questionnaire. The more you know about their likes and

dislikes, the more personal you can make your services Post information that will interest themRecognize their personal achievements

and family events.



5. Recognize that satisfaction is not enough

People will not stay with you and build a long-term relationship because they are satisfied. They expect that.

You need to deliver exceptional service

You need to exceed their expectations - give them more than they anticipated.

Care about them more than they are used to being cared about.



6. Ask your customers to help you

Once you have built a good relationship, you'll often get help from your customers.

Ask for Feedback on what needs improved Provide referrals andProvide testimonials to promote your business

The added benefit of this is that the laws of psychology show that when people have helped you in this way, they will act consistently afterwards and are therefore even more likely to buy from you again.



7. Focus on your most profitable customers

Typically you will find that 80% of your profits come from 20% of your customers.

So you need to understand which 20% are most profitable by looking at the Lifetime Customer Value

The total amount somebody would spend with you over their time with you as a customer.


Consumer SpendingConsumer SpendingValue (Quality of life)

Benefits > PriceRelevant

Economic benefitsEco-systems services benefitsHealth & well being benefits

Authentic (Real is good)TimeAttentionTrust

Source: Charlie Hall, Ellison Chair in International Floriculture, Texas A&M

Benefits of Human-Plant Benefits of Human-Plant InteractionsInteractions

Economic BenefitsEnvironmental

BenefitsHealth/Well-being

Benefits

•Beautification draws customers & reduces shopping stress•Boosts occupancy rates•Generates tourism revenue•Job creation from increased services demanded•Reduced health care costs•Increased property values•Tax revenue generation•Reduced street repairs & maintenance costs•Upgrade effects of surrounding areas•Revenue from educational & special events

•Carbon sequestration•Improved air quality•Attracts wildlife & promotes biodiversity•Energy cost saving associated with heating/cooling•Reduced heat & cold damage•Offsets heat islands•Reduced noise pollution•Reduced soil erosion•Reduced storm water runoff•Improved water quality•Reduced urban glare•Effective windbreaks

•Improved concentration & memory retention•Enhanced learning capacity•Plants generate happiness•Reduced stress & depression•Health & recreation benefits•Accelerates healing process•Therapeutic effects of gardening•Improves relationships/ compassion•Improved human performance/ energy•Medicinal properties•Improved mental health •Reduced community crime•Traffic safety/ driver satisfaction

Source: Charlie Hall, Ellison Chair in International Floriculture, Texas A&M

Top 12 Gardening & Lifestyle Top 12 Gardening & Lifestyle Trends for 2013-14Trends for 2013-14

1. Lifestyle Forces Grow your own food (edible

ornamentals)

2. Wellness #1 reason people select the products

they buy

3. eConoForces Suburb houses & lots are smaller Younger generation is moving back into

cities Focus on Greener Urbanization Today’s Garden Center; Oct 15, 2012


4. Color Forces Happy yellow, bright blue, healthy green

5. Natural Forces Natural solutions – environmentally safe Landscapes: integrate sustainable

designs & elements6. Ground Forces

Increased interest in what goes into healthy soil; gardening from the ground up

Young gardeners selecting organic products over chemical solutions

Today’s Garden Center; Oct 15, 2012


7. Air Forces Air plants are the new terrariums Air plants can purify air of indoor

toxins

8. Aqua Forces Need to reduce water consumption Demand for drought-tolerant plants

9. Light Forces Light for “Wow” effects Low energy lights



10.Inner Forces Connect with nature Inspiring green interiorscapes (green

walls)

11.Micro Forces Anything tiny is “Hot” Landscape: mini meditation gardens

and miniature gardens

12.Shared Forces Sharing sustainable living spaces


Documents

OFA Short Course (July 2012) Current Challenges Facing the Industry 1.Weather Conditions 2.The Economy 3.Identifying & Connecting with Customers 4.Slow