You’ve fought and won the battle to acquire new customers. Now the questions is, “How do you keep those customers and win the war?” It may not be as hard as you think.

The actions required to keep customers start long before you’ve acquired trial. Customer satisfaction is determined by what you’ve promised them in your marketing communications. That’s because customer expectations set the standard we must exceed in order to keep the customer satisfied. Since you want to exceed expectations, it’s tempting to under-promise and over-deliver. However, that is a very high-risk approach: your weak promise creates an equally weak motivation for customers to give you trial.

Overselling – making claims you cannot back up with actions – is no better. Customer acquisition is usually so expensive on a per-customer basis that you can rarely recover that cost with the margins won through a single sale.

The bottom line? As my father used to say, “Don’t issue any cheques you are not prepared to have cashed.”

Why Customers Leave

Assuming you have made realistic promises, customers can still leave your pharmacy for a variety of reasons. Not all of these sources of dissatisfaction are within your control. For example, one survey found that roughly 10% of customer turnover is due to the combined effect of people moving or having a friend enter the business. There isn’t much you can do about people moving out of your district or people wanting to do business with friends. The best you can hope to do is replace those customers with people moving into your neighbourhood (Don’t forget those “welcome wagons”!) and growing your network of “near friends” via community involvement.

Of the remaining customers, most people think that the majority of customers leave because they are attracted to the promises and offers made by a competitor. That is rarely the case. In fact, surveys have shown that relatively few customers leave because of a more attractive competitive offering: estimates range from 9% to 33%.

The most prevalent reason for customer migration is customer dissatisfaction due to employee attitudes, not overselling. In fact, one survey found that it was five times as likely that the dissatisfaction was due to employee attitudes rather than overselling!

Why It Happens

There are three main reasons why customers may encounter employees with seemingly negative attitudes: disinterest, insufficient capacity and lack of knowledge.

Disinterest means employees feel they have nothing to gain or lose from how they serve customers. When employees provide service in a brusque manner or can’t be found to provide service at all, customers can sense that their business is unimportant and their patronage underappreciated. Disinterest can be countered through a variety of “carrot and stick” approaches. Incentives like bonuses, reward programs and profit sharing seek to motivate employees to be on their best behaviour. Alternatively, you can control disinterest via intense supervision and the threat of dismissal.

Neither of these approaches works in all cases. Rather, human resource managers tell me that the real key is to focus hiring decisions on “service attitude.” Skills can be taught; the desire to serve cannot. Even WestJet, which proudly reminds us that 86% of their employees are owners, concentrate their hiring practice on finding people with the right attitude.

But even the most service-minded employee will have trouble showing their interest in customers if they are overworked. This implies that trying to save money by under-staffing is no bargain at all. That said, no one can afford to have staff on hand “just in case.” The solution used in many retail stores is to cross-train staff so that they can pitch in during unexpected peaks. For example, at some large retailers, every employee is trained in how to operate the cash register and instructed to do so as soon as they see more than three people in the checkout line.

Lack of knowledge is the most common reason why customer interactions with staff are negative. At a minimum, customers do expect staff to know where things are located throughout the store and to provide directions in a pleasant manner. They also expect some degree of product knowledge and to know which products are on sale. Some simple training can provide your staff with the necessary information and ways of conduct. Just remember that customers do not distinguish service staff from other employees: anyone visible to a customer is likely to be asked questions.

However, training isn’t always the answer. Sometimes it is simply a matter of communication.

The Unique Nature of Service

Service is an intangible: before receiving the service, customers cannot see it, feel it, taste it or smell it. This is because services are produced and consumed at the same time. Thus the same staff who perform the service are also your primary salespeople and therefore spend the most time with customers and have the greatest impact on customer loyalty.

This makes them very important people. And yet, beyond the pharmacist, those front-line staff are usually not managers. Rather, they may be part-time staff brought in during peak times. Those staff are rarely privy to your marketing strategy and, as such, may be uninformed as to who your target customers are or how you have positioned your pharmacy in their eyes.

In short, they are likely unaware of what expectations customers have. No matter how service-minded and hard-working your staff may be, they cannot be expected to meet customer expectations – and thereby avoid customer dissatisfaction – if they do not know what those expectations are and what that means for how they do their job.

The key is to run regular orientation and update sessions for all staff. Don’t stop at outlining your marketing strategy. Role-playing exercises are an effective way of insuring that your strategy is translated into action on the floor. For each position, identify a few common types of customer interactions they will have and then review appropriate responses. It may seem a little hokey at first, but customers will grow to love the consistent experience they have from one occasion to the next.

No Silver Bullet

It doesn’t take a sophisticated system to keep customers happy. Focus on doing the basics and doing them in a way that is consistent with the customer expectations you’ve created. You may not be able to control everything, but at least you won’t be giving good business away.

Written by Ken Wong

You don’t have to have great advertising or other promotional activity to get people into your pharmacy. However, you do need to be good enough in these areas. What do I mean by “good enough”?

Recall that your primary concern is to get someone to try you. That requires that (1) you give a compelling reason for them to visit your store, and (2), once they are there, you deliver on the experience they expect given the compelling reason for their visit. My last blog post focused on some practices that can block your efforts to give customers a motivation to visit. The experience you provide when they arrive to give you a “trial” is the subject of this blog.

Expectation and Experience

There are two different expectations and experiences to manage. The first, the “trial-generating” experience, is all about getting people to your pharmacy. The second, the “adoption-building” experience, is all about what customers feel once they are on-premise.

One of the most common trial-generating activities involves a promotion of some kind. It may be communicated via weekly flyer, window or in-store banner, email blitz, social media or another medium. Regardless of how it is communicated, buyers attracted by the trial-generating offer have very precise expectations: at a minimum, they expect it to be (a) available in sufficient quantities, (b) easy to find and (c) appropriately tagged for price and deal-expiry date.

Providing a superior trial-generating experience will make it easier to convince that same buyer to return when you run your next trial-generating promotion. However, if that is the total of their activity with you, then we have simply created a “cherry picker.” Clearly we want more.

Therefore, it is important that customers arrive at your store with a second set of expectations as well. These should be about your store’s quality relative to other competing stores. Typically, these expectations are sourced in past advertising, PR, prior shopping experience, exterior appearance of the store and so on.

Adoption-building Experiences

One important question to ask yourself is, “How will my trial-generating offer overcome the reasons why this shopper is not already a patron of mine?” If you answer that the promotion now makes your store “affordable,” your so-called trial-generating offers will likely become part of a full-time merchandising strategy of always being “on sale”: remove the promotion and the buyer ceases to come.

On the other hand, when customer education is the missing ingredient in securing their loyalty, trial generation is an instrument of business development. For example, customers may be unaware of your store, or may need first-hand experience to see the convenience or attractiveness of physical improvements or may need to personally experience your new “customer care” policy.

In these cases, the trial-generating experience should be structured so as to require personal interaction with your staff, whether it’s to get the physical product, claim a coupon, access a promotion or any other part of the purchasing process. This is your one chance to engage that customer by offering advice on product usage, pointing out the availability of accessories or complimentary products, informing them about other pharmacy services, etc. Whatever the nature of that interaction, it should be based on whatever service experience you feel is essential to bringing that customer back. Here are four common options:

1. Superior service: An experience based on good overall service and an exemplary level of commitment to a specific service characteristic like speed, accuracy, assistance, complexity reduction, etc.
2. Superior for a kind of user: An experience based on an intimate understanding of all the factors that a specific kind of user needs. For example, the needs of different chronic disease patients, age groups, ethnic or religious groups, etc.
3. Superior for a specific usage occasion: An experience based on knowledge of the process a customer moves through in connected with that occasion. For example, start of a school year, going off to summer camp, traveling overseas, seasonal ailments, etc.
4. Superior against a specific competitor: An experience focused on that aspect of the competitor’s approach to service that draws the greatest criticism from customers. This type of experience is featured, for example, when competitors expand product lines and can be accused of losing focus on the original products or when they increase the size of operation and can be accused of growing impersonal or inconvenient for shoppers.

Crossing the Finish Line

Customer expectations are the de facto standard against which you will be measured. Meet or exceed expectations and you will likely win a repeat visit (i.e., adoption). Fail to meet expectations and the result is, at best, a dissatisfied customer and, at worst, a reputation for creating deceiving ads. Here are the three steps we discussed above for getting that repeat buyer:

1. Develop an “awareness-building” campaign to communicate a kind of customer experience that customers desire and see as lacking in competitors’ offerings. This is the foundation on which your customer loyalty will be based.
2. Develop a “trial-generating offer” that provides a motivation for that customer to visit your store and to interact with your staff.
3. Be certain to have in place a service process or model so that your staff know how to translate that contact opportunity into an tangible demonstration of the customer experience highlighted in your awareness campaign.

In our next blog we discuss adoption – how to keep what you’ve earned.

Written by Ken Wong

Before you discard a strategy that isn’t producing the expected results, it’s always a good idea to consider first whether the problem is more a matter of execution than strategy. After all, your strategy is like a set of “intentions”: your execution or tactics are how you translate those abstract intentions into concrete actions. Success requires we get both right.

In our last blog Why Customers Don’t Do What They Should we introduced a simple framework – awareness, trial, adoption – for evaluating the effectiveness of your marketing. Two key assumptions underlie this model. First, our overall goal is to develop a strong and long-term relationship with a client. Second, I cannot be loyal (adopt) until I have tried (trial) your product and I cannot try a product unless I know it exists (awareness).

By examining whether we are doing the right things to win awareness, trial and adoption, we can deduce where and why we failed to get the results intended. In this blog, we consider the awareness stage.

Two Types of Awareness to Consider

On the surface, awareness would seem easy thing to understand and assess: either people know we exist or they don’t. But there are two different levels of awareness: aided and unaided.

Aided awareness exists when we ask someone, “Have you ever heard of XYZ?” This is the easiest form of awareness to build since we are only asking, “Does this name sound familiar?” Almost any activity that gets your name in front of people – sponsoring a sports team or local event, sending out a weekly flyer, etc. – can generate aided awareness. So, too, can any bad publicity, even though that type of awareness is not likely to lead to a relationship.

Unaided awareness is a little harder (and more expensive) to achieve, since it measures recognition and association with a particular characteristic. That characteristic could be something as basic as your type of store (“Can you name some drug stores in your area?”) or as complex as an overall positioning (“Can you name some stores that offer great service?”).

One of the most common mistakes in campaign evaluation comes from a failure to discriminate between aided and unaided forms. When this happens we risk confusing “being noticed” with “making an impact.” This often happens when we get too focused on being “outrageous” or “provocative” or “overly cute” or anything else designed to “break through the clutter.” Anyone can be noticed… the key is to be noticed in the right way: I don’t shop at your store because of its name but rather because of what I expect I’ll find there.

If you have high aided awareness but low unaided awareness, it usually means that either your advertising is not being read or there is something about the ad that is making it hard for customers to identify your brand message. There are several reasons why this might occur:

1. Wrong media: Are your ads being shown when and where your customers are most likely willing and able to pay attention to them? After all, I cannot respond to messages I never see. Ask yourself, “When is my audience most likely thinking about products like mine?
2. Insufficient exposure: Many newcomers to marketing run a single ad and then expect to see improved sales. However, our message competes for customer eyes and ears against every other commercial message, regardless of what it sells or to whom. Thus, you do need to “break through the clutter” just to be seen. One or two ads are not usually enough to do this. The question is, “Is your audience so concentrated that you are better running several ads in the same medium (e.g., newspaper or magazine), or is your audience diverse in its interests and attitudes so that you would be better served by running one or two ads in a wide variety of media?”
3. Wrong/no message: Message-free spending – like supporting a local team or event –means many in your area will see your name. Some – but not all – of those who do see your name will associate may even associate it with being “community-minded.” This may seem positive until we ask the question, “How much more is the customer willing to pay in order to shop at a community-minded store versus one that is not?” I’m not suggesting that it is wrong to generate some local goodwill, but we need to be sure we are doing something more specific to give people a “reason to buy” from us.
4. Intangible promises: Intangible characteristics like great service, friendliness or personal attention – to name but a few – are some of the hardest things in the world to communicate. You can’t see, feel, hear, touch or smell such things. In fact, in the case of service, the thing you are communicating doesn’t exist until the moment it is consumed. How do you make it tangible? Personal endorsements (from individuals or online communities), awards or certifications can bring credibility to your claim. Featuring new equipment or new highly qualified people can also give customers a reason to believe. Without something to make your claim concrete, people are likely to think, “It’s all just marketing.”
5. No call to action: If your ad is not directing someone to actually “do something” then it is implicitly saying, “Remember this and then think about it the next time you need something like this.” It’s asking a lot. That’s why coupons, shelf talkers and in-store signage can help jog a person’s memory.
   Keep Your Eyes on the Prize

While our ultimate goal is sales, there are two intermediate tasks to perform en route to making that happen. First, make customers aware – not just of your existence but of your special character. Second, translate that awareness into trial. Show them, or provide means for others to tell them (via for example, social media), how your special character will enrich their life. Once you get “trial,” you’ve given your product or service a chance to win a loyal customer. In our next blog we consider “Converting Trial: Meeting Expectations.”

Written by Ken Wong