Time to branch out?
If there’s one thing you can be sure of in the world of customer research consultancy, it’s that consumers are a flighty bunch. It’s up to us TMP types to work fast and make sure you know about the latest trends before your competition gets wind of them.
With this in mind, two news stories caught my attention this week: Carpetright’s intentions to go upmarket and Ocado, the online grocer, trying to shake off its upmarket image and embrace the middle of the road. Not just consumers who are fickle then…
Carpetright’s move into luxury flooring – happening alongside a reworking of their logo and flagship stores – hardly sounds like the direction the rest of the nation’s been heading in. In fact it’s a move that puts the Witch of Austerity firmly in her place.
Hold on, I thought budget was the new black?
Before you decide that Wilf Walsh – Carpetright’s chief exec – has obviously had too much sun, remember this: Carpetright are seen as a bellwether for our economy. So are consumers really ready to emerge from their austerity mind-set?
The markets definitely think Wilf is onto something, with the company’s shares rising by 5% after his announcement. Their UK like-for-like sales are up by the same amount for the last 8 week period, too.
It wasn’t so long ago that I was talking about Waitrose’s current success being a fine example of the power of brand loyalty. They’re not the cheapest supermarket out there but customers know what they stand for, know what they’re going to get and have stuck with them during the recent financial storms.
So high-end is the way to go?
Hmm. Apparently not if you’re already seen as high-end… Ocado have started attempts to free themselves from their association with upmarket Waitrose, with their CEO Tim Steiner saying that Waitrose’s “perception rubs off on us and that might be, that it is more expensive than it actually is, and that it’s a bit posh.” They’ve got their work cut out – whilst talking shop at a networking event yesterday, one business leader admitted to me that they’d always assumed that Ocado was Waitrose.
Last year, Ocado signed a third-party deal with Morrisons who have a much more middle-of-the-road perception with consumers – and are a much better fit for the Ocado slogan “cheaper than you think”. Their movement to a more central place in the market might just be paying off, as their gross sales rose by 15.7% for the first half of this year and Ocado enjoyed a 30% increase in customer acquisition.
Isn’t this all a bit confusing?
Not really – two directly opposing tales but with one commonality: businesses are branching out. That’s got to be great news for the economy, right?
During times of recession businesses do one of two things to survive – they try and make themselves everything to everyone (poor Tesco…) or go small, stick to what they know and do it well. There isn’t one model that fits every business – it’s why you have to understand your market and be confident that you know what makes your consumers tick – but key organisations are now starting to emerge from the trenches and see what’s out there. Are you ready to do the same? As always, I’m here to help get you focused on what your next move should be.
Three steps to discovering your next business move.
1. Find out what your customers want.
And don’t limit yourself to thinking about the time they set foot in your store or office. Purchases are won and lost way before you set eyes on a customer. Understand their lives, their worries and how you can make things easier for them. And when you know what it is that they want from you, go ahead and make it happen.
2. Identify your limitations.
Do you know what’s limiting your existing consumers? What makes them buy one item instead of two? You need to understand each customer’s experience of using your business – and which parts of the process are the most stressful for them. For me it’s always finding a parking space, thanks for asking, but it might be checkout queues, a confusing store layout or ambiguous pricing. You won’t know until you ask – and crucially, you won’t be able to make things better until you know.
3. Discover you biggest inhibitors.
What’s stopping your prospects from converting? Maybe your customer service needs work, or a competitor is offering the same products or services for less money. If this is the case, what add-on value are prospects looking for to make the cost of your product or service of secondary importance to them? To find out, go back to Step 1 – or get in touch with The Monachie Project.
Our team of consultants are hand-picked to reflect your consumer community, so that we can analyse your brand from the customer’s perspective. Only time will tell whether Carpetright and Ocado are reading their markets right, but one thing you can be certain of – things are starting to change out there.
Are you ready?