Retaining Customers

1. Retaining Customers 2013 Green & Growin Show North Carolina Nursery & Landscape Association

2. OFA Short Course (July 2012) Current Challenges Facing the Industry • Weather Conditions • The Economy • Identifying & Connecting with Customers • Slow Traffic • Declining Retail Customer Counts

3. Why Businesses Lose Customers • 68% - Unhappy with the Treatment they receive • 14% - Dissatisfied with the Product or Service • 9% - Begin doing Business with the Competition • 5% - Seek Alternatives or Develop other Business Relationships • 3% - Move Away • 1% - Die Source: US Small Business Administration & US Chamber of Commerce

4. Customer Relationship Management (CRM) • Customer relationship management: • A systematic tracking of consumers’ preferences and behaviors over time in order to tailor the value proposition as closely as possible to each individual’s unique wants & needs • CRM facilitates one-to-one marketing • CRM systems use computers, software, databases, and the Internet to capture information at each touchpoint. • Touchpoints are any direct interface between customers and a company (online, by phone, in person, etc.)

5. CRM References “Principles of Marketing” by Phillip Kotler and Gary Armstrong “Real People, Real Choices” by Michael K. Coolsen and M. Patricia Galitz “The Australian CRM Market” by David Sims

6. Value and Satisfaction • Perceived Value • The customer’s evaluation of the difference between benefits and costs. • Customers often do not judge values and costs accurately or objectively. • Customer Satisfaction • Product’s perceived performance relative to customer’s expectations.

7. Four Steps in One-to-One Marketing • Identify customers and get to know them in as much detail as possible • Differentiate customers by their needs and value to the company • Interact with customers; find ways to improve cost efficiency and the effectiveness of the interaction • Customize some aspect of the products you offer each customer

8. Capturing Value from Customers • Customer Loyalty and Retention • Share of Customer • Customer Equity • Customer delight leads to emotional relationships and loyalty • Customer Lifetime Value shows true worth of a customer Key Concepts

9. Capturing Value from Customers • Customer Loyalty and Retention • Share of Customer • Customer Equity • Share of customer’s purchase in a product category. • Achieved through offering greater variety, cross-sell and up-sell strategies. Key Concepts

10. Capturing Value from Customers • Customer Loyalty and Retention • Share of Customer • Customer Equity • The combined customer lifetime values of all current and potential customers. • Measures a firm’s performance, but in a manner that looks to the future. • Choosing the “best” customers is key Key Concepts

11. Not All Customers are Equal Butterflies Good fit between company’s offerings & customer’s needs: high profit potential True Friends Good fit between company’s offerings & customer’s needs: highest profit potential High Profitability Potential Prof itabi l ity Strangers Little fit between company’s offerings & customer’s needs: lowest profit potential Barnacles Limited fit between company’s offerings & customer’s needs: low profit potential Low Profitability Short-term Customers Long-term Customers Projected Loyalty

12. Some CRM Offerings • Fusion Line of Integrated Solutions  • Cam Commerce Retail Star • NetSuite Multi –Channel Retail Mgt Suite • Epicor Retail Solutions • Counterpoint by Radiant Systems • NetSuite • Act by Sage • Amber POS • Merchant OS • Microsoft Retail Management System • ALMsi • Vend POS • MultiFlex RMS Fashion • Salesforce.com • Sugar CRM

13. 7 Steps For Building Long-Term Relationships With Your Best Customers • Concentrate on getting the second sale • People are only customers if they buy from you regularly. And many people will buy from you once and never again. • To turn someone into a genuine client, the most important thing is getting the second sale from a new customer - and getting it as soon as possible. • After that, they are more likely to stay with you and build the relationship. Source: Robert Greenshields

14. 7 Steps For Building Long-Term Relationships With Your Best Customers • Always act in their best interest • People are more likely to do what you ask if they believe you have their best interests in mind. This is the 'Law of Friends'. • To build a business relationship, show clients that you are looking after their interests. • This trust can normally only be built over time. • Stop worrying about getting clients to like you and focus on looking after them. • Don't be interesting. Be interested. That helps you think of them as individuals.('Built to Last' by Jim Collins) Source: Robert Greenshields

15. 7 Steps For Building Long-Term Relationships With Your Best Customers • Keep in touch regularly • You can build trust by giving valuable information - rather than simply promoting your services. • Newsletter • Social Media • YouTube • Podcasts and teleseminars • Postcards Source: Robert Greenshields

16. 7 Steps For Building Long-Term Relationships With Your Best Customers • Make your contact personal • To make your contact with customers personal, you need to learn about them. • Start by just listening to them • Post a survey on your website or conduct a customer questionnaire. • The more you know about their likes and dislikes, the more personal you can make your services • Post information that will interest them • Recognize their personal achievements and family events. Source: Robert Greenshields

17. 7 Steps For Building Long-Term Relationships With Your Best Customers • Recognize that satisfaction is not enough • People will not stay with you and build a long-term relationship because they are satisfied. They expect that. • You need to deliver exceptional service • You need to exceed their expectations - give them more than they anticipated. • Care about them more than they are used to being cared about. Source: Robert Greenshields

18. 7 Steps For Building Long-Term Relationships With Your Best Customers • Ask your customers to help you • Once you have built a good relationship, you'll often get help from your customers. • Ask for Feedback on what needs improved • Provide referrals and • Provide testimonials to promote your business • The added benefit of this is that the laws of psychology show that when people have helped you in this way, they will act consistently afterwards and are therefore even more likely to buy from you again. Source: Robert Greenshields

19. 7 Steps For Building Long-Term Relationships With Your Best Customers • Focus on your most profitable customers • Typically you will find that 80% of your profits come from 20% of your customers. • So you need to understand which 20% are most profitable by looking at the Lifetime Customer Value • The total amount somebody would spend with you over their time with you as a customer. Source: Robert Greenshields

20. Consumer Spending • Value (Quality of life) • Benefits > Price • Relevant • Economic benefits • Eco-systems services benefits • Health & well being benefits • Authentic (Real is good) • Time • Attention • Trust Source: Charlie Hall, Ellison Chair in International Floriculture, Texas A&M

21. Benefits of Human-Plant Interactions Source: Charlie Hall, Ellison Chair in International Floriculture, Texas A&M

22. Top 12 Gardening & Lifestyle Trends for 2013-14 • Lifestyle Forces • Grow your own food (edible ornamentals) • Wellness • #1 reason people select the products they buy • eConoForces • Suburb houses & lots are smaller • Younger generation is moving back into cities • Focus on Greener Urbanization Today’s Garden Center; Oct 15, 2012

23. Top 12 Gardening & Lifestyle Trends for 2013-14 • Color Forces • Happy yellow, bright blue, healthy green • Natural Forces • Natural solutions – environmentally safe • Landscapes: integrate sustainable designs & elements • Ground Forces • Increased interest in what goes into healthy soil; gardening from the ground up • Young gardeners selecting organic products over chemical solutions Today’s Garden Center; Oct 15, 2012

24. Top 12 Gardening & Lifestyle Trends for 2013-14 • Air Forces • Air plants are the new terrariums • Air plants can purify air of indoor toxins • Aqua Forces • Need to reduce water consumption • Demand for drought-tolerant plants • Light Forces • Light for “Wow” effects • Low energy lights Today’s Garden Center; Oct 15, 2012

25. Top 12 Gardening & Lifestyle Trends for 2013-14 • Inner Forces • Connect with nature • Inspiring green interiorscapes (green walls) • Micro Forces • Anything tiny is “Hot” • Landscape: mini meditation gardens and miniature gardens • Shared Forces • Sharing sustainable living spaces Today’s Garden Center; Oct 15, 2012

26. Retaining Customers 2013 Green & Growin Show North Carolina Nursery & Landscape Association Thank you for your attention!