Customer loyalty, retailers say, is the lifeblood of their sector, because repeat business keeps stores busy even in a down economy.
Several kinds of investing in human resources can be effective ways to create this loyalty.
Sitting near the Skywalk entrance to his Vancouver store, Holt Renfrew president Mark Derbyshire explains that bolstering relationships with customers has always been Job 1 with him.
Five years ago, when he was in charge of human resources at Holt Renfrew, he revamped one of his chain’s most effective recruitment and retention tools: the staff discount.
He ended what was a confusing raft of different staff discounts that depended on where an employee worked in the company and introduced a flat 50% discount for all regular price merchandise and a 33% discount on all sale products and cosmetics.
“People who work here love fashion,” Derbyshire told Business in Vancouver.
“Our goal is to help make things more magical for them. Why not give them a better opportunity to wear the clothes they love? That’s great for the business. Customers would go, ‘Where did you get this?’ ‘Oh, right over here, I’ll show you.’ It brings together the theatre of sales.”
A fourth-generation retailer, Derbyshire has mastered the friendly arm squeeze, the megawatt smile and the importance of looking people in the eye when speaking with them.
He also appreciates the value of empowering and motivating employees.
“The power and strength of relationships directly correlates to the success of this business,” Derbyshire stressed, while sitting inside his Pacific Centre store. He was appointed president in January.
The Vancouver Holt Renfrew expanded its Chanel collection in September after the French fashion house closed its storefront in Vancouver. Derbyshire hosted an on-site party for staff and longtime customers the night before.
He also held a pep rally similar to those that Vancouver entrepreneurial legend and 1-800-Got-Junk? owner Brian Scudamore regularly holds to motivate staff.
Buying personalized nametags is another of Derbyshire’s strategies to strengthen bonds with customers.
His rationale was that while employees can forge a bond with customers by greeting them, that bond would be deeper if the customer could look at the employee and immediately see their name.
Not all retailers recognize the value of that approach.
Urban Barn staff, for example, wear generic badges that show they are employees but do not contain individual names.
“The amount of administration for a small organization to print individual name tags would be prohibitive,” explained Urban Barn human resources manager Satri Alpine.
“If we just have a basic tag, it’s easier to manage.”
Clearly, Coquitlam-based Urban Barn has been doing something right. It grew revenue 158% between 2004 and 2008 to rank No. 78 on Business in Vancouver’s most recent list of fastest-growing companies in B.C.
“We use a holistic approach to build a bond with customers,” Alpine said. “It starts at the time of hire and follows the employee all the way through their time here.”
Money spent upfront to vet the best candidates and interview them thoroughly pays dividends, she said.
So does sales training.
Companies too small to have in-house sales training can take training courses from organizations such as the retail trade association Shelfspace: The Association for Retail Entrepreneurs.
Dollar Giant CEO Joseph Calvano stresses training for workers.
The man who sold his company in mid-October to Virginia-based Dollar Tree Inc. for $52 million makes a point of personally visiting his 85 Canadian locations, including 35 stores in B.C., as a way to build staff morale.
“Through my store visits I show that I care about [staff] and am there to listen to them,” he said.
Careful design of store layout, as well as investments in technology are other ways to enhance interaction between staff and customers and build a stronger connection with customers.
Urban Barn has in-store kiosks where customers and staff can sketch room layouts. The company is also investing in technology so a computer program can show the dimensions of furniture products in a floorplan.
Telus Corp.-owned Black Photo Corp. has also paid close attention to store layouts.
Its new store at the corner of Robson and Seymour streets is square, with cash registers in the middle of the room.
“The relationship with the customer is so much stronger,” said Black’s senior vice-president Peter Scully. “Staff can talk about building photo books and help customers correct photos, if photos need to be corrected.”