TECHNOLOGY SEEN WAY TO KEEP TOP CUSTOMERS

PHILADELPHIA -- Retailers recognizing the need to keep their most profitable customers happy should employ technology solutions that identify and excite these customers, and shape the shopping experience based on their needs.Retailers need to know their customer base, especially the most profitable customers, said Richard Kochersperger, director for the Center of Food Marketing at St. Joseph's College

PHILADELPHIA -- Retailers recognizing the need to keep their most profitable customers happy should employ technology solutions that identify and excite these customers, and shape the shopping experience based on their needs.

Retailers need to know their customer base, especially the most profitable customers, said Richard Kochersperger, director for the Center of Food Marketing at St. Joseph's College here. Once those relationships are established, retailers need to provide a compelling reason for those customers to continue shopping in their stores.

"I spend $10,000 a year on food, but if you do not give me solutions and reasons to shop your store, I am not coming," he said.

"What is worse, store managers don't know who I am, and even worse, they don't care," he added. "I spend $200 a week. Retailers should be identifying customers like me because there are not that many of us out there. They should know us and know us well."

Information technology can help retailers stand out against the competition. "You need to take chances and look to other industries to differentiate yourselves in the customer's eyes," Kochersperger explained.

For example, the gasoline industry is deploying a device that customers attach to car windshields. As the customer pulls into the gas station, a signal is transmitted to the office, and an associate greets regular customers with a newspaper, a cup of coffee or a Danish while their gas is pumped, according to Kochersperger.

"Think of what this technology can do for the supermarket industry," he said. "As a profitable customer enters the parking lot, the store manager's beeper goes off, and he runs to meet 'Mrs. Jones,' who is worth $20,000 [annually], at the front door with a shopping cart.

"You can't afford to lose her, and your competition is going to try to steal her," he added. "It is technology and ideas like this that you should be thinking about in order to keep her."

Kochersperger spoke during the Retailer Owned Research National User's Conference, held in Arlington, Texas, last month.

Retailers also need to move beyond paper coupons and direct mail, and put more emphasis on the Internet and electronic media to appeal to loyal customers, he said. "Why are retailers focusing on coupons that only return a 3% redemption rate, [in-store coupon] programs with a 15% redemption rate, and direct mail that has a 20% redemption rate?" Kochersperger asked. "Retailers should want a significant bump that is higher than between 15% and 20%. The Internet can provide that."

More specifically, Kochersperger predicted that on-line home shopping is going to help provide customer satisfaction, especially as the medium continues to grow.

"On-line services are growing, and by 2000, 30% of American homes will have a membership to some type of on-line service," he explained. "No one is making money right now, but it will work. How are we sure it will work? In 1929, 15% of the food dollar was delivered directly to the home.

"This medium will work, someone just has to figure out how to do it the right way," he added. "Can you afford to lose 15% of your sales to a consumer direct network? The answer is 'no way.' "