Five do's and don'ts for marketing your retail business ^*

DO

1. Observe your market carefully to capture opportunities and trends early.

Retailers need to be able to look at the key factors, such as changes in technology, social attitudes, government and legal regulations, that can profoundly affect their business.

This is to both take advantage of possible opportunities for growth and also to help avoid threats that may harm their business. Usually the business will have no control over these market factors but still needs to react quickly to their presence.

For example, many successful retailers selling fur coats suffered from greatly reduced demand for fur apparel when attitudes towards killing animals for fur changed drastically in the eighties, making fur coats highly unpopular.

One third of all photo printing stores that operated in Australia 10 years ago have since shut down. This is because the technology most in use changed from traditional film processing to digital photography. This meant new equipment, more training for staff, the need for more capital, etc., with the result being that those who were not well prepared or able to afford the change went out of business.

2. Be aware of your business's relative strengths and weaknesses.

Any retailer (especially an SME) must be very objective about its relative strengths and weaknesses if it is to survive and grow. Unlike external opportunities and threats that the market offers you which you can not control, internal strengths and weaknesses can be controlled and changed by the retailer.

As well by having a complete inventory of your strengths you will be in a better position to take advantage of any opportunities that may be around.

3. Look for groups of customers with similar unmet needs you can meet.

In most markets, you will find smaller groups of customers that exist within the overall market that have similar needs and can be grouped into market segments or niches.

If the retailer can provide a product or service that can meet this common need, then it will do well by targeting that market niche.

For example: Easy Tone Studio in Melbourne offers exercise equipment with a difference. Rather than the standard gym equipment, it offers assisted exercise where the machine exercises that area of the body passively. This can be used both for elderly people and those recovering from illness or injury.

Although these people are in different groups, they have a similar need for assisted exercise. Suffice to say, Easy Tone has differentiated itself from other gyms, and is highly successful as a result.

4. Know exactly who your customer is and what you need to deliver to keep them satisfied.

Most small retailers make the mistake of mass marketing. They try to sell their product or service to everyone in the market. Simply put, different people need different things.

Therefore it is critical to look at your market and make a decision about exactly what part of the market you want to target for your business and what their specific needs will be.

For example, The Athletes Foot sells only running shoes for athletes and runners. They are known to have the best range of brands, shoe sizes, fitting equipment and general expertise in fitting to ensure the correct size and shoe for any foot. In short they have an area of proven excellence. They know who their customers are and they deliver a personalised product for each. This is the true essence of marketing.

5. Acknowledge and reward those people who contribute to your success.

In most businesses, your staff will be a combination of high performers, average contributors and occasionally low performers.

Suffice to say, it is imperative that you identify your top performers so that you can acknowledge their efforts and reward them accordingly.

Traditionally larger firms lead the way by having incentive packages that not only reward individuals for the period just gone, but also involve rolling incentives over two or three years, to act as an effective retention tool for key staff over a longer period.

DON'T

1. Assume you know what the customers' needs are.

Perhaps the fast way to ensure any retailer fails is to assume you know what the customer wants.

A leading Australian market researcher, Frank Domantay, MD of Research Insights says: "Successful businesses routinely do customer research that allows them to understand what they are doing well and what they are not doing so well."

This research can be in the form of a survey, one-on-one interview or focus group. The results can directly feed into strategic planning for the retailer and are often the first indication of a need to change some aspect of the business or its' products.

For example, a recent survey done by a local Melbourne-based, medical clinic found great dissatisfaction by patients in the approach by the front office staff.

As a result, the staff was retrained in both customer relations and social style.

2. Try to market yourself exactly like your competitors do.

To fully understand how important this point is, you need to understand that the customer's need is really made up of two things. Firstly: the met portion of the need which are the elements that customers are already satisfied with and secondly, the even more important unmet need, which is where the real opportunity lies to stand out from the crowd. If your business follows your competitor's blindly and mimics everything they do, you will basically be meeting the same met portion of the need and leaving the same unmet portion of the need.

An example of a retailer that did not follow its larger rival's example was Dial a Dino's Pizza, Australia's first national pizza delivery company. The company was the first to include free home delivery and as a result differentiated itself in a way that not only made it successful, but ultimately compelled the market-leading Pizza Hut chain to buy it out or risk losing market share.

3. Take your customers for granted.

The ongoing support of key customers must also be acknowledged with incentive schemes designed to both reward and maintain customer loyalty, as well as drive demand for future purchases.

These schemes do not need to be complex. Trendy cafe Buddha's Belly offer a simple loyalty scheme, where they offer a free coffee after five purchases. Simple but effective.

Larger organisations like Subway have a similar card that offers a free drink after eight purchases of their subway sandwich. These are simple ideas that work.

It's important to remember that, for a lot of businesses the 80/20 rule applies. That is that 20% of your customers generate 80% of your business.

The bottom line is, know who the 20% are and reward them for their support.

4. Fail to strengthen areas you have identified in your business as weak.

There is do doubt that a business is only as strong as its weakest link.

You may have a great product but if it is incorrectly priced, poorly promoted or not consistently available in the store due to unreliable suppliers, it will fail. These or any other ongoing weaknesses must be promptly addressed to ensure the businesses ongoing success.

Today's consumers are more aware and less tolerant than they have ever been and any on going weakness your business has that it does not seek to overcome, will translate into lost customer loyalty and sales.

5. Lose your overall perspective and work/life balance.

As important as it is to perform well and run a profitable business, retailers must always be wary that the business has the potential to take over your life and leave you with an imbalance between your work and the rest of your life. This is a complex issue but there are some key strategies that can help.

1. Schedule time-outs and honour them.

2. Take a time management course that will teach you to be more efficient with your time.

3. Learn the power of delegation, once you have established that an individual is capable of doing that task or role.

By Daniele Lima, MD of Road Scholars Sales and Marketing Consultancy
* Reproduced with permission.

25 June 2007