DDI - September 2010 - (Page 56)

56 | Think Tank Retail innovation— the new mandate for retail success I n a recent survey, 70 percent of business leaders indicated that the “customer experience” will be the new battleground for business success. If that is in fact the case (and it is), then how can retailers create exceptional customer experiences in a world of shrinking budgets? The answer is simple—innovation. Unfortunately, however, the term innovation is one of the most overused and, in many cases, misused terms in the business world today. So, what is innovation, and how can it beneﬁt retailers? My deﬁnition of innovation is this: “the delivery of exceptional customer value.” Consistently, innovating in retail requires a commitment from the top down. But, the beneﬁts of mastering customer-driven innovation include increased sales and proﬁt, improved customer loyalty, improved proﬁt per customer visit (PCV) and stronger brand value. One of the most exciting systems in the area of retail innovation is what I call “Contact Point Innovation.” This allows you to identify what a customer is experiencing at each point of contact, so that you can invent world-class solutions to serve your customer. The various phases of Contact Point Innovation are: Nicholas J. Webb 1) Pre-Touch This is a potential customer that has not yet done business with you. They know you through word of mouth, digital media, advertising, reputation and other external communications. This phase sets their baseline level of expectation and is important in building retail trafﬁc, sales and, more importantly, a lifetime customer. Innovation methods can be deployed at the pre-touch phase through Contact Point Innovation. The best way to build pre-touch innovation is to deliver exceptional experiences, so that your customers help you build the pre-touch buzz. Additionally, provide free online resources to pre-invest in the customer relationship. You should also develop a digital command center that builds and monitors your digital reputation. the frontline and maximize your customer contact. By doing this, you will be able to actively observe ways of increasing the quality of the ﬁrst touch. (Hint: This is just a short shopping list of hundreds of things that must be considered as you observe your customer during the ﬁrst touch.) 3) Last-Touch Customers will oftentimes judge your brand based on the last experience they had with your business. How do you send your customers off? Have you developed innovations that keep them connected and engaged with your retail store? There are myriad opportunities to invent at the last-touch point. 4) In-Touch I have found that innovation superstars develop a wide range of value-added solutions that keep customers coming back for more. Develop multiple ways of staying in touch with your customer—not to sell them, but to provide them a meaningful value. This has increased sales dramatically for many retailers. Remember, the least expensive customer to acquire is the customer you already have. 2) First-Touch As the axiom suggests, “ﬁrst impressions can last a lifetime.” The ﬁrst contact that a customer has with your business will have a permanent effect on his or her patronage. The ﬁrst touch is heavily weighted in terms of importance, and we must create retail environments and teams that always deliver an exceptional ﬁrst-touch experience. However, we can only create these environments and direct our training efforts if we understand what customers truly care about. This is where the heavy lifting of innovation comes into play. I call this “innovation while walking about”—you must spend time with 5) The Bottom Line As I’ve said in my books, “innovation is easy.” The hard part lies in knowing what to invent—or reinvent. To get to that visionary point, you must make the commitment to innovate across your enterprise. —Nicholas J. Webb is an innovation strategist and author of the new book, “The Innovation Playbook: A Revolution in Business Excellence” (Sept. 2010). He is also the keynote speaker at the DDI Forum 2010, to be held Sept. 23-25 at the Hilton Sonoma Wine Country in Santa Rosa, Calif. | September 2010 www.ddionline.com http://www.ddionline.com

Table of Contents for the Digital Edition of DDI - September 2010

DDI - September 2010
Table of Contents
From the Editor
Newsworthy
Shopper Insights
Greentailing
Editor’s Choice
Portfolio Awards 2010
Retail Design Luminaries
Retail Design Influencers
Design Firms of the Year
Best Visual Merchandising Programs
Retailer of the Year
Best-Designed Stores of the Year
Retail Standouts
Calendar
Advertisers
Classifieds
Think Tank

DDI - September 2010