IBM has conducted a study indicating that while satisfied customers may in fact be a retailer’s best advertising, relatively few shoppers are so satisfied with the retail experience that they are willing to recommend it.
According to a Reuters story about the study, the key word is “advocate” – meaning the kind of customer “who would recommend their grocer to others; would not switch if another valued grocer moved into the area and would increase purchases if the grocer offered other products.” While “advocates are 19 percent more likely to give the majority of their business to one grocer than ‘antagonists’ and 14 percent more likely to spend in excess of $100 per week at their main grocer,” the study also says that only about 27 percent of shoppers are willing to be advocates for their supermarket.
According to a Reuters story about the study, the key word is “advocate” – meaning the kind of customer “who would recommend their grocer to others; would not switch if another valued grocer moved into the area and would increase purchases if the grocer offered other products.” While “advocates are 19 percent more likely to give the majority of their business to one grocer than ‘antagonists’ and 14 percent more likely to spend in excess of $100 per week at their main grocer,” the study also says that only about 27 percent of shoppers are willing to be advocates for their supermarket.
- KC's View:
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This isn’t exactly news; I’ve been hearing variations on this song for the more than 20 years that I’ve been writing about retailing…though, to be fair, I can't remember hearing precise statistics before. Give IBM credit for quantifying a problem that everybody knew existed.
Particularly illustrative is another set of statistics from the study: 19 percent of supercenter shoppers are advocates, while 26 percent of supermarket shoppers, 32 percent of membership club shoppers, and 46 percent of shoppers who patronize regional grocers feel that way.
That this suggests is that there are two things you can do to turn shoppers into advocates – get closer to the shopper the way smaller businesses are able to, and create a unique, “treasure hunt” kind of experience, the way clubs do.
To put it another way, vanilla may be a flavor that doesn’t offend many people, but it also isn’t a flavor that many people will go out of their way to sample or recommend.
