January 17, 2006

Keeping Customer...REAL Customers

Barry Kalinsky tells me that the average mass retailer gets 30-35% returns. That's astounding. That means that one-third of the merchandise that's bought is returned. What a lot of work!

Returning merchandise is a pain in the neck. But, for many consumers, the act of shopping must be so satisfying that it is more important to them than their need or want for any product itself. So, returns are simply part of their shopping process. Kind of a bulimic mind set, in my opinion.

At Barry's store - Bob Ellis - the returns are only about 5%. I think that's because Bob Ellis sales personnel treat each customer individually and really get to understand what they want and provide it in the most graceful way. It's a treat to watch. And it is so different from the cookie cutter customer treatment one sees at most mass retailers. The Bob Ellis staff focuses on relationships, not transactions. But, believe me, the cash register never stops ringing!

We do a lot of secret shopping and have done so for years. Heck, I almost ended up having to buy a time share condominium once because of the over enthusiasm of my associate during a secret shopping adventure. (But that's a story for another time.)

Typically, secret shopping helps you understand how well customers are handled by your client and their competitors. Are they covering all the key bases...and how well? We typically go that extra step of identifying the extent to which the staff listens to us, picks up on what is most meaningful to us, and treats us individually. And that can make the difference between returns of 35% and 5%.

Breaking the Geek Barrier

There are more and more cool gadgets out there, but the real prize is always going to go to the producer who can make us regular folks feel in control of the gadgets we use. And I think we're going to see much more of that.

Until recently, too much has been geek friendly but regular person intimidating.

Consumers now - more than ever - want to be in control. We want to be treated as individuals (as Bob Ellis so wisely appreciates) and we don't want to be intimidated...by people or by gadgets.

My guess is that we'll see a lot more well designed, smooth functioning, and VERY easy to operate gadgets - even those that converge several media (the big new thing) - and then the boom will truly be a boom.

iPod is the icon. It is the standard. Perhaps it's only the beginning.