Retail, in the eyes of the everyday customer

My buddy Mike from Vexxt shared this great email from 1-800-PROFLOWERS:

I consider myself an astute student of retailing so was surprised to discover a very cool concept I knew absolutely nothing about.  The name of the company is The Unclaimed Baggage Center.  Unfortunately, they don’t retail online but you must go check out unclaimedbaggage.com and see their press coverage here.

Retailers are working extra hard these days.  On my afternoon walk I saw two guys standing near the station selling $3 Jamba Juice smoothies out of a white box.  I know Jamba Juice wants to drive sales but I think this is a penny wise pound foolish strategy for three principle reasons:

– Brand dilution: I thought the unique selling proposition of Jamba Juice was that one could walk up to the counter, order a smoothie and have the juice expert prepare it right in front of us?

– Authenticity: How do I even know if this is a legit setup? The guys were wearing Jamba Juice tee-shirts but there was no specific branding on the box itself.

– Price point: Is $3.00 for a Jamba Juice smoothie too high or too low? The only people who could really answer this are Jamba Juice regulars.  So, in effect, this promoted price means little to non-customers.  The whole idea of setting up a stand on the street is to get non-customers to try your product once.

Here is what I would have done:

— I would have made a nice little Jamba Juice banner, slapped Jamba Juice stickers on the box, slapped another sticker on the smoothie itself and given customers an authentic proof of purchase receipt.

— Instead of saying “$3 Jamba Juice Smoothies” I’d say “Pedestrian Special 25% discounted Jamba Juice Smoothies for only $3.00“

Jake is a huge fan of KuKuRuZa gourmet popcorn.  He discovered the site 3 years ago and started off by ordering their Variety Pack.  He enjoyed Caramel & Cheese Mix so much he bought it five times, thrice gifting it to friends and family.  Jake’s lifetime spend on KuKuRuZa.com is a very impressive $197.00 and we know Jake is not a bargain hunter because his purchase habits are not localized around special price promotions.  All in all, Jake is an ideal customer.

He has often visited the Butter & Sea Salt page and lingered long enough for us to know that the flavor catches his attention.  Unfortunately, Jake has never purchased it.  A 1 gallon bag of Butter & Sea Salt retails for $8.95.

The enterprising manager at KuKuRuZa sees that Jake has not bought in the last two months and executes a complimentary order of the 1 gallon Butter & Sea Salt bag accompanied with a handwritten note that reads “Jake, I am the manager at KuKuRuZa.  I wanted to thank you for being a loyal customer by sharing this complimentary bag of our delicious Butter & Sea Salt.  Regards – Robert.“

This is a hypothetical case study but imagine the impact it would have on Jake.  Sure we spent $8.95 plus shipping on a bag of popcorn but that’s pittance compared to how much Jake has spent with us.  This small investment could trigger word-of-mouth and Jake is bound to share his KuKuRuZa story when he speaks with friends.