Trader Joe’s meteoric rise in revenues and most other measures has been nothing short of spellbinding. With sales of nearly $1,800 per square foot (RetailTrak), almost doubling their closest rival Whole Foods, and others, the company is the darling of the business community.
Recently, I read a 2013 Market Force customer satisfaction survey that reported that TJ’s was rated highest in customer satisfaction, but was not in the top 5 spots for location, low prices, sales/promotions, and one-stop shopping.
Given their success and the fact that they don’t rely on price, it’s curious to me that so many independent retailers lower their prices as their first line of defense rather than doing anything else to improve (or distinguish) their businesses.
It’s often a knee jerk reaction that ignores what I call the 4 M’s.
When this occurs, retailers usually have less of the 5th M – MONEY.
Trader Joe’s focus on customers in unrivaled. 80% of their stock is branded under their name, which suggests that customers trust the brand. One reason the company can get by with fewer SKUs. (Some estimates have TJ’s selling less than 10% the number of SKUs, but achieving twice the revenue per square foot compared to Whole Foods).
Their service is friendly and helpful – reminiscent of earlier times. They have a deep knowledge of customers and maintain a sharp focus on predicting and meeting changing needs.
Their success makes them the “bell of the ball,” and, while you may not be opening 38 stores this year, there is one change you can make in your management routine to achieve a customer service focus that will catapult you to the Trader Joe’s of your niche.
Put everyone through customer service training and then consistently
and persistently remind them about your customer service expectations.
That’s the cat’s meow when it comes to seeing your service levels increase. You can bet that their managers and associates talk about more than just 2 Buck Chuck and fresh produce.
They consistently talk about the customer.
Many companies go part way but not the whole way.
– They tell staff to deliver good service.
– They give a few examples.
– They have meetings about customer service once in a while.
– They may even train new associates on customer service during orientation.
But they don’t put associates through customer service training and then consistently and persistently remind everyone about their customer service expectations.
Sure, the rah-rah meeting is nice, and things usually improve for a few weeks, but without reminders many find themselves right back where they started…
…And that’s not the Trader Joe’s of your market or niche…
That’s just the way it works.
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