16 of 2017

Newsletter No.16    05 May 2017

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Source Africa

Fabiani, Woolworths, H&M, Miladys, Markham, Cotton On, Mr Price score well on customer centricity

A recent survey, conducted by dunnhumby, the ‘Customer-Centricity Index’ (CCI) reveals that South Africa’s most successful apparel retailers are those with a high focus on ‘customer-centricity’. The local retailers that scored the highest on their overall customer-centricity score include Fabiani, Woolworths, H&M, Miladys, Markham, Cotton On and Mr Price.

Cath Jordan (Mbonigworks)

The dunnhumby CCI report scores retailers on seven ‘pillars’. By identifying these key drivers behind a customers’ likelihood to repurchase from a particular retailer and their desire to recommend the retailer to friends and family, the study also demonstrates a direct link between customer-centricity and improved financial performance. In the study, retailers were scored out of 100 for their performance against each of the seven pillars in order to determine the most customer-centric retailers.

  1. Affinity – A strong connection between the store and the customer. Help customers to get everything that they need and having their expectations surpassed.
  2. Range – Having the right products and a strong variety to meet customers’ needs. The best companies do not try to carry every possible product but make sure to carry the products their customers want.
  3. Service – Making the shopping experience easy, enjoyable and convenient. The best companies make customers want to share their positive experiences.
  4. Promotions – Leveraging promotions on the items that are most appealing and often purchased by their current customers. The best companies promote the products that matter most to their customers.
  5. Price – Providing prices that are perceived to be in line with what the customer is looking for, on the products they purchase most often. The best companies do not have to be the price leaders, but need to have pricing that customers see as fair.
  6. Communications – Personalising the message to customers, based upon what they buy and delivering it in a way they like. The best companies provide tailored, relevant communications based on customer preferences.
  7. Rewards – Rewarding and recognising customers in a consistent way that is relevant to how they want to be rewarded. The best companies reward customers in the ways they prefer for how they shop.

Top scorers

According to the latest CCI report, menswear store Fabiani topped South Africa’s list for high scores on ‘Affinity’ and ‘Service’ pillars with Country Road ranking in second place for ‘Affinity’ and H&M following closely behind Fabiani on ‘Service’.

Woolworths took the lead in the ‘Range’ and ‘Communications’ categories with H&M and Foschini in second place respectively.

On the ‘Price’ pillar, Pep Stores ranked highest followed by Pick n’ Pay Clothing.

When it comes to ‘Promotions’ H&M led with Jet ranking second and for ‘Rewards’ based on their customer loyalty rewards programmes Pick n’ Pay Clothing were clear leaders with Edgars in second place.

The study found that, of all the pillars, ‘Affinity’ correlates most closely with high Customer-Centricity, indicative of the personal connection that is built by retailers when their offering genuinely reflects their values to drive long-term loyalty. The overall top retailers highlighted in the report consistently perform well on price, range, service and promotions, with attributes reflecting common themes such as good value, enjoyable shopping experience and satisfaction.

Majority fail to meet customers’ needs

However, amongst the 24 major South African retailers surveyed, over 70% of the retailers analysed do not currently meet the levels of customer-centricity required to deliver significant sales and market share growth showing huge potential for local retailers to focus on implementing more customer-centric strategies.

GM of dunnhumby SA, Graeme Tulloch comments, “Although most retailers understand and pay lip service to customer-centricity, we can see from our data that local retailers are mostly still product-centric. Our goal is to help identify gaps and implement effective solutions.”

The global version of the CCI study also shows that in the US, Asia and most of Europe, an enjoyable shopping experience has significant impact on customer perceptions. All highest scoring global retailers shared an emphasis on meeting customer expectations with clearly marked prices, developing trust and transparency, stocking a relevant range of well-valued products complete with an easy checkout process. Therefore, despite the changing, omnichannel retail landscapes the successful retailers here demonstrate that the fundamentals of getting the customer journey in-store right are still paramount.

Highlights

Tulloch highlights the trends revealed by their CCI surveys. “Looking at our data we are seeing trends that there are strong financial rewards to be enjoyed by the most customer-centric retailers. Our report shows that doing one or two things well will help retailers build a connection with shoppers and by focusing on the seven pillars from our CCI report will drive more sales for retailers. For retailers that can forge and protect a niche; the message is to build total clarity around their customer offering. Larger, more general retailers should harness their data assets to listen to customers and personalise key aspects of their proposition on a scale that only they have the power to do.”

Woolworths Celebrates 10 Years Of The Good Business Journey A decade of making the difference

Woolworths Holdings Limited (WHL) is pleased to announce the 10th anniversary of its Good  Business Journey (GBJ), a flagship South African sustainability programme that was launched in 2007 by Simon Susman, now Chairman of WHL, as a commitment by Woolworths to make a difference to people, communities and the environment.

The GBJ was a first of its kind in South African retail whereby sustainability became a strategic platform for the business with specific public targets. Over the last ten years the GBJ has set new standards across its eight focus areas of transformation, social development, health and wellness, ethical sourcing, sustainable farming, waste, water and energy. Last year, the company updated its GBJ goals through to 2020 including embedding the programme into the Group’s Australian businesses which now account for over forty per cent of turnover.

Ian Moir, Chief Executive of WHL said,

“When we launched the GBJ in 2007 we didn’t really know exactly where it would lead, but we did know it was the right thing to do and that it would be a journey. It was the type of innovative thinking that has been important to Woolworths since it was founded 85 years ago, and it was a way for us to bring together all the different social and environmental initiatives we were already busy with, under one flagship programme. These are initiatives that matter most to us and everyone our business touches, and the GBJ was our plan to make an even bigger difference.”

“We’ve learned a lot along the way and we continue to learn from both our successes and mistakes. The issues behind the GBJ have, if anything, become even more important than they were ten years ago. Our goal now is to be the most sustainable retailer in the southern hemisphere and we have built a strong business  case around sustainability.”

Justin Smith, Head of Sustainability at Woolworths said: “This is an important celebration which allows us to remind ourselves that business is no longer about profit alone, but about creating shared value and delivering on our commitments and responsibilities to empowering our people and protecting our planet. This is precisely what the GBJ is about.”

“Sustainability is the heart of what we do and over the years’ experience has shown us that as Woolworths, alone we cannot solve the challenges around sustainability – we need support and input from our stakeholders and partners. With this support over the years we have been successful in implementing programmes like Farming for the Future, Fishing for the Future, responsible cotton sourcing and energy & water efficiency. This milestone is a thank you to our partners and stakeholders who have enabled us to make this journey a success, and we look forward to achieving our GBJ 2020 commitments.

Some of the GBJ successes in the last 10 years include:

• MySchoolMyVillageMyPlanet which raised R393m in the last 10 years. 1.2m supporters. 8127 beneficiary schools, NGOs and charity partners.

• Over 600 primary and secondary suppliers are part of the Woolworths Farming For the Future programme.

• Only whole free-range eggs are sold in our stores and over 95% of our egg ingredients are free range.

• R2.4bn in value created over the life of our Black Employee Employment Share Ownership Scheme and R332m in dividends distributed to beneficiaries over the life of the scheme.

• 42% relative reduction in energy usage and over 50% relative reduction in water usage in our SA stores.

• We have more than 100 green stores and have completed 4 solar projects so far

• We were the 1st SA retailer to remove sweets from checkout aisles.

• R27.7m donated in 12 years to the EduPlant programme.

• 44 Enterprise Development suppliers currently working with Woolworths.

• 381 jobs created through the Clothing Bank programme.

• 33% of our cotton now from sustainable sources.

• Over 10m PET bottles recycled into fibre for use in our jeans, t-shirts, reusable fabric bags each year.

• Raised R10.7m for charity through sale of our reusable bags.

Since inception of the programme, Woolworths has won a number of international awards for the Good Business Journey including the ‘Responsible Retailer of the Year’ award which Woolworths received three times.

“With hindsight, 10 years ago when we started the programme we were thinking mainly as a South African business developing a strategic programme for South Africa. We are truly humbled at the international recognition we received for the GBJ and it’s something we didn’t foresee at the time. As we look towards our GBJ 2020 and even 2030 commitments we are truly encouraged by the impact and success that GBJ continues to have on our operations and communities both in South Africa and Australasia”, concluded Moir.

Did you know….

Victorian women would often wrap themselves in wet muslin so that their dresses would fit as snugly as possible. The downside? They’d often get sick and sometimes die. Doctors at the time blame the practice for an outbreak of influenza in Paris.

Pink for girls and blue for boys is a relatively new phenomenon: A 1918 catalog advised blue for girls because it was a “much more delicate and dainty tone” and pink for boys because “it’s a stronger and more passionate color, and because it’s actually derived from red.”

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