SRM/U5 Topic 12 CRM & Brand Management in retailing
Customer relationship management in retail can increase customer satisfaction, reduce your costs and improve your company’s performance in the marketplace. CRM software manages your relationships with individual customers to create advantages for both parties. To select the appropriate software and ensure it includes the features you need, you have to know how CRM works and what effects it has on your retail operations.
CRM helps you gather information about each of your customers, including preferences and demographic data. You can use such information to segment your market and customize your approach to each group of customers. For example, if you find you have a large number of young families in a segment, you can create a family-friendly retail environment. If your data shows you have many seniors, you can install ramps for wheelchairs and make your store more easily accessible. The effect of segmentation based on CRM data is to adjust your retail strategies to better suit the customers you have.
The data you gather within a CRM system lets you not only target a market segment with promotions that appeal to its members, but also to target individual customers. For example, when you know that a customer is reaching retirement age, you can promote appropriate hobby products to him. If you see that a customer has visited your website and looked at particular products, you can include promotions of those products in his mailings. In this way CRM reduces promotions that are of no interest to the recipient and increases the relevance of material you send out.
A CRM system keeps records of customer purchases and customer service calls. You can keep track of the products each customer has purchased and whether there have been any warranty or dissatisfaction issues with the purchase. This information allows you to send out special offers to customers when the products they have purchased reach the end of their lives. Such a strategy keeps your products in front of the customer just when he might need them and gives him the benefit of lower pricing if he buys from you again. On your side, the costs of such a targeted promotion are lower than marketing to a large group and receiving only a few responses.
The overall effect of CRM is to increase the retention of customers by serving them in a more focused and convenient way. You can further increase this effect by using the CRM software to implement customer loyalty programs. Since the applications already track purchases, you can issue reward points and bonuses to keep valuable customers. Such programs let your further reduce costs because sales to long term customers are less expensive than sales to new customers.
Brand Management in Retailing
The mechanism of selling products in small quantities from fixed locations to the customers for their end use is called as retailing.
In the current scenario where the end-user has several options to rely on, it is essential that the retailer promotes his brand well amongst the masses.
Let us go through some tips to promote a retail brand well:
Signboards go a long way in creating brand awareness and promoting a particular brand.
- The signage must display the name as well as logo of the retail store.
- It must be installed at the right place visible to all even from a distance.
- It should not be very small. Small signages fail to attract the customers.
- Choose the right paint colour.
- Don’t add unnecessary information. Keep it simple but informative.
- Make sure the signage attracts the customers into the store.
- Choose the right theme.
Advertising is a strong medium which influences the buying decision of the customer and prompts him to shop. The retailer must ensure to communicate the USPs of his brand to the target customers well through various modes of advertising. The advertisement must be eye-catching for the end-users to click on them.
Various ways of Advertising
Billboard is one of the best ways of out of home advertising.
Out of home advertising refers to creating awareness amongst the individuals when they are out of their homes.
- Install hoardings, banners, bill boards at strategic locations such as heavy traffic areas, major crossings, railway stations, bus stands etc to entice the customers. The retailer must ensure that the banners get noticed and bring results.
- Newspapers, Television and radio are also effective ways to promote a brand. Television reaches a wider audience and makes the store popular amongst all.
- The advertisement should be a visual treat, appeal the customers and prompt them to visit the store.
- Coupons are an effective way of promoting a brand as they offer some kind of financial benefit to the customers in the form of discounts and rebates and thus attracting them into the store.
- Coupons help in furthering the brand image of the retail store without much investment.
- More and more people visit the stores to redeem the coupons, thus making the brand popular.
- Discounts, sale, rebates are good ways to promote a brand.
3. Private Label
- Private label is an effective way to promote one’s brand at low costs.
- Products manufactured by one company but sold under another company’s brand name are called Private Label Products.
- Create your own website.
- Print your own calendars, diaries, planners, table tops with your store’s name, address as well as logo. Such an activity creates awareness among individuals.
- Always keep your visiting cards handy and distribute them to as many people as you can.
- In the current scenario, social networking sites go a long way in promoting brands. Create communities and invite people to join the same.
- Customer loyalty programs help to retain customers and attract new individuals to the store.
- Create a positive ambience at the store. Nothing works better than customer satisfaction in the retail industry. One satisfied customer brings ten new customers along with him.