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Listen – user experience research PAYS!

 In Uncategorized

I enjoy a bargain. Getting value from the TMP coffers gives me a feeling of satisfaction that’s usually reserved for my friends Ben & Jerry, but however much I like to make my hard-earned cash go further, I still avoid some discount stores. You know the ones – run-down shops filled with cheap knock-off goods that spill out onto the pavement. To me, they have more than a whiff of a dodgy car boot sale.

Not Poundland. This week, they announced an increase in annual sales of 11.8% – taking them over the £1bn threshold for the first time. 5.3 million of us visit Poundland every week – that’s over 8% of the entire UK population. It looks like the only thing not discounted are the profits. No wonder shareholders backed the business so eagerly when it was floated on the stock exchange last year.

It’s fair to say that a lot of their success lies with the recent rise of bargain-hunting, savvy shoppers, but The Monachie Project’s consumer experience research shows that brand loyalty takes more than the promise of a bargain. Let me tell you what’s working for the newest members of the £1bn club.

Shh…hear that?

Silence. Poundland aren’t talking. I don’t mean they’re not telling anyone their recipe for success, I mean they’re listening – to customers and staff. Poundland’s CEO Jim McCarthy isn’t a man who’s afraid of accountants. In 2006, his shop staff were telling him that being cash-only was restricting the amount customers could buy. So he made every store card-friendly – despite his financial team telling him the cost would be prohibitive. Why? I can’t put it better than Jim myself.

“I’ve been brought up on providing the customer with what they want… it was right for the customer and so therefore right for the business.”

Music to my ears! How does he know what’s right for the customer?

He asks – and then he listens.

The company commits to a lot of customer research – more than most businesses of the same size. And we’re not just talking data-crunching. Poundland runs regular focus groups and even take their products into schools and community groups to get their opinions. Add that to the fact that his store staff are encouraged to share their thoughts and experiences, this is one CEO who manages to stay on top of the issues that matter most – to the people who matter most.

It’s how Poundland’s board knew that consumers wanted quality goods at discounted prices. Branded products now line the shelves of every store and some, like Maxwell House, produce merchandise specifically to stock in Poundland stores – or as Jim puts it, “products for £1, not £1 products”.

It seems to be working. Poundland now attract 22% of their customers from the highest socio-economic groups and the 2014 Customer Experience Index showed that the firm has shot up the rankings to an all-time high of 105. Nice work, Jim.

Fancy a trip up north?

Let’s compare Poundland with Hunters of Helmsley. Admittedly, not quite a household name, but if you’re interested in what works in retail then you should take some time to get to know it. It’s OK, my TMP faithful – I’ve done the work for you.

Hunters, a family-run farm deli in North Yorkshire, was recently awarded the title of Best Small Shop in Britain by the Independent Retailers Confederation. Described as “a quality delicatessen for the truly discerning customer” Hunters is a million miles away from the Poundlands of this world – think of Dot Cotton turning up at Downton Abbey – but in its own way just as successful.

Listening works for every size of business.

Don’t say I haven’t been trying to tell you… Local pride is everywhere in Helmsley. Residents enjoy a sense of belonging to their community and they love showing off their market town to tourists – and tempting them with the local Brymor dairy ice cream. I can recommend the praline pecan – tasted only for research purposes, naturally. So what matters in Helmsley? Local.

A key part of Hunters business ethic is supporting local suppliers and 70% of their products are sourced from within God’s Own County, as I was told Yorkshire is more accurately named. Without getting too League of Gentlemen, in Helmsley, local products matters to local people. Hunters takes regular time out to get to know suppliers new and old – and to find out what it is that keeps customers coming back.

But they didn’t stop at buying from local suppliers – it was their community work that really wowed the Independent Retailers Confederation. In 2012, Hunters formed a business group to get Helmsley through the recent difficult economic times. They promote the area, create events to attract visitors and strengthen community spirit. That’s something else that matters to their customers – community. And by making themselves a central part of it, Hunters of Helmsley is now as much a part of the local landscape as dry stone walls and Swaledale sheep. The place just doesn’t know what it’d do without them. It’s nice to see that the good guys really can get their reward.

So, we have a nationwide discount store built on the true meaning of value and a high-end delicatessen that knows the importance of community. Very different but both winning formulas. The one thing they’ve got in common? Both Poundland and Hunters make the effort to listen to their customers.

Are you ready to reap the rewards of listening? The Monachie Project’s user experience consultancy will ask the right questions so you get to hear what really matters to your market. Get in touch to find out more.

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