The five pit falls for body shop as identified are
1.) Inconsistency of Personalized customer service : as service standard provided by different service staff form body shop differ from time to time, there will be times whereby customer service towards platinum customer exceed customer expectation wherelse there are times where poor service is administrated by body shop ‘working staff members to customers such as low efficiency-eg not able to find product code, not knowing where product are placed both which would cost customer’s time. This would negatively impact the imagine of body shop.
2 Poor Product knowledge of staff :Product knowledge is important to customers of body shop as body shop is skin care product brand whereby consumers make decisions based on the benefits the product posses for example a person with oily skin would purchase the set of seaweed series to combat their oily skin complexion, thus Staff would need to effectively communicate the benefit in order to convince customer and bring in the sales. Wrong recommendations could sometimes lead to customers purchasing the wrong product that are not suitable for their skin type , in worst case it would result in allergy reactions,
3 Attractiveness of loyalty program Love Your Body™ card :Loyalty program is not point based and does not reward frequent purchases and also does not motivate customers to make frequent purchases
4 Notification of promotions: Although body shop run frequent promotions for its product, the duration and range of product on promotions, such information are mostly not available to people who do not subscribe to the newsletters online.
5 Brick and mortar retailing format :Body shop in Singapore does not offer online shopping ,customers could only view updates on new products and also the price list of products, however they would have to make their way down to the physical store to make their purchases which could be inconvenient to some customers who do not frequent malls where the skin care retailer are located. However an interesting aspect would be that this arrangement would forces the customers to come and visit the physical store, and also increases the possibility of customers purchasing more than they had originally wanted to.
Effects of pitfalls on the different group of customers in the customer pyramid
Platinum customer
Typically body shop’s platinum customers are the most loyal user, they are the least price sensitive group of customers and are the heaviest users of the product, they would also be more willing to try new items introduced by body shop due to faith in the brand itself, Thus platinum customer concerns most with value and quality of merchandise that they purchase
Inconsistency of Personalized customer service :When a platinum customer receives poor customer service, they would be more willing to put out with it ,due to long standing ties with body shop and they would also bother to provide valuable feedback back to the management.
Notification of promotions : not important to platinum customers as they are less price sensitive.
Poor product knowledge: As platinum customers are long time customers of body shop, they would had by then formalize themselves with the product they are using and thus know what works for them therefore in the event where the need to make repeat purchasese,they do not need additional product knowledge about the product they are familiarize with anymore, However they still require new product knowledge, updating to new skin care formulated by body shop
Attractiveness of loyalty program :As the love your body program introduced by body shop is not a point based system, platinum customers would not be able to accumulate points , while they could still enjoy discounts, price is less of an Issus among loyal customers, platinum customers of body shop would like to feel valued by the retailer, Retailer could foster such feelings by organizing product events, events and talks about usage of skin care for this group of customer. Thus the loyalty program would need to recognize the loyalty of these customers in non tangible form rather than monetary form
Brick and mortar retailing format: Would cause inconvience to platinum customers as they would most likely purchase the product that they used before thus an online retailing platform with delivery would be most beneficial to platinum customers,
Gold customer
Gold customer compared to platinum customer are firstly not as loyal, secondly are more price sensitive and thirdly do not purchase as much as compared to platinum customers. However they are the group of customers that are most likely to be converted to platinum customers. The bulk of bodyshop’customers would be Gold customers, as firstly it is difficult to convert a gold customer to a platinum one in the skin care industry due to large number of choices and difference in pricing.
Inconsistency of Personalized customer service : When a gold customer receives poor customer service from a body shop’s staff this could have an impact on whether they will make the purchase in the store or not , due to the lower loyalty value a gold customer have with bodyshop,any bad experiences encountered such as rudness and bad attitude towards them would tip the balance and turn them away from making a purchase.
Poor product knowledge: Product knowledge is important to gold customers because firstly they do not purchase as much or as frequently as platinum customers thus product knowledge on the varies range would be lacking and also they take pricing of product into consideration therefore staff must have the ability to communicate the benefits of the skin care range offered by body shop as this would allow gold customers to weight the benefits to cost as they attempt to justify the price ($18.90-$22.90) they will be paying for a product of body shop. Poor product knowledge could lead to reduce sales from gold customers.
Brick and mortar retailing format: Lack of online platform could also give inconvience to this group of customer however the impact would not be as big as it had on the platinum group of customers due to lower frequency of purchase and also other choices available.
Attractiveness of loyalty program : As gold customers are price sensitive customers, body shop’s love your body would be attractive to gold customers as it provides immediate discount but does not accumulate credit for future redemption therefore , the program benefit non frequent buyers in the short term as discounts are given out instantly while on the other hand it does not reward long term purchases due to the inability to accumulate redemption points. This program would appeal most to Gold and Iron customers as both these 2 groups are not frequent purchasers compared to platinum customers.
Notification of promotions :Would be popular with gold customers due to higher price sensitivity as It would attract them to make a trip down to physical store.
Iron customers
Iron customers of body shop are the second bottom tier of quality of customers, they are not likely to develop loyalty due to high price sensitivity, have the habit of comparing retailers(body shop) against other retailers(face shop), choosing the product base on their price tag. Therefore they are not likely to spend much in body shop alone, purchasing power is spread over a range of retailers. Only minimum attention is to be given to this group.
Inconsistency of Personalized customer service :Would not have significant bearing on group due to emphasis on price rather than other factors such as customer service
Poor product knowledge: Product knowledge Would still be important to a certain extent to customers in this segment, however benefits would be strongly compared against its price, expectations of benefit to price ratio is higher compared to gold customer group ,even more so than gold customers, customers in this segment are willing to settle for skin face with lesser benefits promised but with a much lower price tag.
Brick and mortar retailing format: Matter little to customers from this segment as they would only purchase when price is ideal, and there is a high possibility that customers would be more willing to put in extra effort to obtain a lower price product , therefore convenience matters little to customer from this segment.
Attractiveness of loyalty program: Loyalty program would be quite attractive to this segment due to its structure of instantly rewarding short term purchasers , thus is view favorably by price sensitive iron customers.
Notification of promotions :Is attractive towards this segment as it inform them when is the “right” time to come down to body shop to make their purchases
Lead segment of customer
Lead segment of body shop’s customer base are the lowest quality of customer profile, they are the least profitable group, and demands the most attention from retailer itself, This segment is highly price sensitive and overall tend to produce a negative lifetime value if they are retained.
Inconsistency of Personalized customer service :Would have significant bearing on group due to group’s demanding nature for service and attention, customer from this group could make a complain and perhaps obtain some retail vouchers in the process
Poor product knowledge: Product knowledge be important as customer from this group tend to demand attention from service staff, service staff are require to inform about the benefit but usually no sales are conducted.
Brick and mortar retailing format: Does not matter as it is uncommon for people in this segment to become frequent purchaser thus maintaining an online platform would not benefit them much.
Attractiveness of loyalty program: Is attractive to group as it allows instant discounts and also entry to events and talks organized by body shop with a small fee of $10 per annul.
Notification of promotion :Attractive to group as it informs them when is the time whereby they could stretch their dollar to the maximum
by heeyuan
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