“indies: Stop Mimicking Loyalty Schemes”

Rob Ward, founder of honestfoodlabelling.com and the Food Marketing Network, is hosting a teleseminar for retailers on 25th and 26th February.

Following the success of the US ‘webinar’ concept,  the session is expected to appeal to time-strapped deli owners, farm shops and c-stores.

“I’ve been concerned about independents losing profit through loyalty scheme related discounting for some time, so this is an opportunity to address it,” said Mr Ward.

Research into the number of ‘loyal’ customers shopping in an average UK independent and observations on their buying behaviour makes a strong case for the seminar.

“All retail businesses will have a core 20% of customers. These generate 80% of their revenue and are likely to be the first in line to join a loyalty scheme. This makes discounting crazy. Not because retailers shouldn’t show they appreciate regular custom, but because these loyal customers are totally in love with the shop already. I guarantee that 25% of them would be prepared to increase their spend by as much as 500% if they were offered the ‘right’ products,” explained Mr Ward.

“Think about the profit if 20% of your customers are generating 80% of your revenue but a quarter of these could be spending up to five times more?” he urged, highlighting the merits of avoiding rather than implementing loyalty schemes.

“It is important to have an affordable offer of basics in food retail business, but is there another way to adjust prices based on higher levels of service and different products? My objective is to show shop owners what alternatives they have – ideas that will help them make customers clearly understand what they are buying and why these products cost more,” said Mr Ward.

To put these ideas into context, retailers listening to the teleseminar will be encouraged to consider how other industries increase their offer to up their profits. “Look at airlines. They often segment their service into three clear categories so customers know that by choosing a certain level they’re also accepting the cost that goes with it. The parcel business is the same. Customers buy time (and security), paying more for overnight delivery with online tracking than they would for a straightforward seven-day service, for example.”

The session is currently being promoted with a direct mailout to 1,000 selected food retailers; 4,000 business professionals; and 6,000+ Twitter followers. Final places will be limited to 300.

Mr Ward is also looking to run a second teleseminar on ‘how to make social media work for food businesses’ next month.

For further information visit: www.FoodMarketingNetwork.com