3 Lessons Retailers Can Learn from Service-Based Businesses
Retailers generally like to stick together.
It was fairly rare in my almost 4 years of management consulting to run across a retailer who wanted to include a service based business into their competitive analysis.
I did see it, once.
From a visionary CMO who had aspirations of changing the way delivery and fulfilment worked in online retail. He's not there yet, but he definitely has his eyes set on the best practices from the service industry, namely, pizza delivery.
Although service and physical product businesses do vary on many MANY aspects, there are several key things that service-based businesses do really well.
These are concepts that retailers focus on enough for their online experience but can bring massive added value to your customer, and ultimately positively impact your conversion and repeat buyers.
1. Service-based businesses put 'service' first
Imagine this. You walk into your favourite Italian restaurant, and the Maître d' remembers your name. He sits you at your favourite table (the one by the large windows that face the street), and before you're even settled, you have menus in your hand, lemon-water poured into your glasses, and a bowl of fresh-out-of-the-oven bread on the table.
This is the experience that you will remember, and this experience has already exceeded your expectations.
Think about your online store.
When someone visits your website.. do they feel special? Are they welcomed into your store environment?
When they purchase with you for a second time, are they offered anything extra? Do they feel valued?
What experience do customers have when they receive your package in the mail?
Crafting a unique, engaging and personalized experience on your online store will enhance your conversion and customer retention.
Though there are many ways to execute on this, from building a personalization engine to serve up a landing page with the products you know would be of interest to your customer based on their past purchasing behaviour, to a simple handwritten note in the package, acknowledging them, thanking them for shopping with you again.
How you create this service-first mentality in your eCommerce store is an integral part of your overall brand experience.
2. Service-based Business will do anything for your email address.
Nothing pains me more than when I visit an eCommerce store, and I cannot find their email opt-in form. Well almost nothing.
When I find that form, if it says "Sign-up for Updates". That. That pains me more!
How generic and boring? Who would give their email to you with that carbon-copy offer?
If you've ever gotten a massage, or chiropractic care, they will often ask you as you are paying for your services if you want email reminders of your appointments sent out. I always say YES, because I often forget appointments (even if they are in my calendar).
I know that they are probably adding me to their mailing list, but that's ok because I'm getting value out of the exchange.
What are you doing to give customers in exchange for their email addresses?
Brainstorm what your business could offer that would help serve the needs of your customers, wherever they are at with your product.
For example, if you're selling handmade Wooden Hammers, perhaps a link to a resource guide for hammer-only projects (that would be my kind of woodworking project by the way, sounds easy!). If you sell bicycles, providing a link to an exclusive group on Facebook for biking enthusiast, staffed by a bicycle professional who answers questions once a week.
Think value first. Getting someone's email address is a big deal. It's a direct link to their inbox potentially every week which could mean thousands of dollars in revenue for your store.
3. Service-Based Businesses think about Customers as a long-term relationship.
I often get questions from clients on how much is too much to give when it comes to customers.
It's an interesting question as retail can be very different in this aspect. If you're thinking lifetime customer value, i.e. how much a customer will spend with you in the lifecycle of the product, it can be hard to estimate.
Whereas, with a service based business, they tend to know, a customer will come in for X number of treatments, or sessions, or meals, or workouts.
However, thinking of a customer, as an investment of your time, is not a bad thing. In my business, I put customer service FIRST because I want people to have an amazing memory of my brand.
The best publicity out there is a satisfied customer.
So, if it takes me to invest in a 15% off discount for returning customers, I'll do it, knowing that I'm cultivating a long-term customer that will hopefully buy with us 3-4 other times throughout the year.
Customer relationship management is a cycle. Many small retailers lack the tools to keep the relationship wheel turning.
Email as I mentioned above is critical to this, as this is your link to your existing customers that have opt-ed in to hear more from you. But, cultivating a long-term relationship is also very connected to crafting that memorable experience I mentioned above as well.
Think of how you can invest in your existing customers to make them keep you top of mind in their consideration set.
Service-based businesses do in essence have service on their minds all the time. The retail landscape traditionally has not had this same mindset though retailers like Zappos, Nordstrom, and Apple to name a few, do focus intently on the customer experience.
And it's no coincidence that they are some of the more profitable, high-growth retailers in their sectors.
Wishing you much abundance + retail bliss,