From the Editor and food retailing trends October 2016
Service the key to more sales
October 2016 – In my hometown there is a “new boy in town” on the food retailing scene.
Farm Boy opened one of the chain’s newest locations a convenient 15-minute walk from my house. The 30-year-old regional food retailer has about two dozen stores throughout Ontario.
What I like about Farm Boy is its level of customer service. The employees go out of their way to ensure you’ve found everything you’re looking for. You’re clearly not bothering them when you ask for something. They smile. A lot.
It’s about as close to the experience of a farmers’ market as you can get, and farmers’ markets offer the gold standard in customer service.
To be fair, all of the food stores in town do a good job in merchandising produce, but some are a little more customer service oriented.
And that augurs well for those stores because the future of in-store retailing will revolve around improved customer service. There is considerable interest by consumers with online shopping for perceived savings and convenience. What if you could visit a website to select groceries in the evening, and then pick up your order the next day on your way home from work…the boxes packed in your trunk while you wait in a drive-through. It would be so convenient.
U.S. e-commerce sales growth, according to the U.S. Commerce Department is continuing to outpace that of bricks and mortar stores. One Canadian study is forecasting that 10 per cent of all Canadian retail spending will be done online in 2019.
What the Internet can’t match – yet – is the same level of customer service for which the better stores are well known. But retailers will have to pick up their game if they’re to maintain market share.
A 2011 American Express survey found that 78 per cent of consumers have walked away from an intended transaction because of poor customer service. That same report found that 70 per cent of respondents said they would spend more money with companies who they believed provided superior customer service.
Marketing Metrics reports that the probability of selling to a new customer ranges from five to 20 per cent, while the probability of selling to an existing customer is between 60 and 70 per cent.
The White House Office of Consumer Affairs says that it is six to seven times more expensive to gain a new customer than it is to keep a current customer. It also notes that for every customer who bothers to complain, 26 others will not bother.
And when it comes to customer service, make sure your website is easy to navigate. More than 70 per cent of U.S. shoppers increased their online research in 2015, according to the Omnishopper Guide, and I’m sure the same is true on this side of the border. If your website isn’t helpful and welcoming, you’re losing customers.
Some 79 per cent of millenials regularly use social media, so if you’re not on Facebook or Instagram, you’re also losing customers.
And then there’s my favourite customer service quote, courtesy of Kate Zabriskie, president and CEO of Business Training Works. “Although your customers won’t love you if you give bad service,” she notes, “your competitors will.”
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