Experience Matters

Here we are, a few months into 2012, and the global recession that began in 2007 remains with us. The European Union continues to struggle with additional financial problems arising monthly, it seems. The United States' financial problems persist -- and will continue as long as our monetary system is based on creating money via printing presses whenever the government runs out. Even China is having difficulties. Although large amounts of European and American money continue to flow to the East, the average consumer has tightened up their spending habits quite a bit over the past five years.

So, how in the world with an economy like this, is the entire production of Ferrari 458s sold out (according to Car and Driver magazine, July 2011)? After all, boiled down to its basic essence, a Ferrari is simply an automobile -- personal transportation from one point to another. This same personal transportation can be completed in the same amount of time in most American and European metropolitan areas with a Volkswagen, a BMW or a Fiat 500.

What's the difference? Are Ferraris really that different? Are they that superior?

I would venture to say that the same type of marketing that made the Ferrari a desirous automobile is also at work at Starbucks today. You see, at the beginning of the Starbucks empire, the company realized its competition was fighting over the cheapest cup of coffee. Since coffee is little more than ground-up roasted beans suspended in hot water, there is a decent profit margin on the product. Yet McDonald's, QuikTrip, 7-Eleven and Dunkin' Donuts were all competing for customers with their version of a 50-cent cup of coffee.

Starbucks saw something different. Rather than trying to see how cheap they could make a cup of coffee, they asked, "How can we massively enhance our margins on a cup of coffee?" Starbucks has been very successful at convincing its customers to purchase their daily cup(s) of liquid caffeine for $4 a cup.

The question is: How does what Ferrari and Starbucks do in their marketing have anything to do with the profits you make in your c-store?

You see, the key is experience. If you simply needed to get from point A to point B, there would be no market for Ferraris. If you simply needed a quick jolt of energy in the morning, there would be no need for Starbucks. It's the experience that people will pay extra for.

In a Ferrari, the sound of the engine; the feel of the ride (extremely well-damped without being harsh); the envious glances from others in their SUVs and BMWs; the steering that is never too light, never too heavy; the feedback off the road through the steering and suspension -- it all comes down to one thing: the experience. Being treated like royalty or a movie star, and looking successful and seemingly being an icon, also adds to the experience.

At Starbucks, customers pay $4 for the experience they enjoy. Starbucks innovated its stores to give its customers what they "wanted." Customers don't want to buy their coffee from a clerk; they want to buy it from a barista. They don't want to buy coffee from a convenience store or a fast-food restaurant; they want to buy their coffee from a specialty coffee establishment where the barista knows them by name and knows what they want to drink without having to ask.

So, how do you give that kind of experience to the customers in your convenience store?

Here are a few no-cost ways that most c-store operators don't take the time to consider:

1. When a customer asks for a product and the sales clerk knows where it is, the clerk should personally take them to the product. Don't just point and tell them where it is.

2. When a customer comes up a few cents short, take the money out of your pocket (never short your business -- if you do it, your sales clerks will do it).

3. Have an "All Coffee is Small" day. The typical margin on coffee is 50 to 60 percent and you probably throw out a lot of your coffee if you work to keep it as fresh as possible (especially after 10 or 11 a.m.). So have a day that no matter what size the customer orders, you charge them for a small -- and make sure the customer knows you are doing this for them as a sign of appreciation for their business.

4. Take a couple of hours on a Saturday and work at your gas pumps. Wash windows, check the tire pressure, check the tread on the tires, check the oil and coolant levels; basically check whatever you feel comfortable with checking.

5. When your customer laments about a product or service they need but can't find, get it for them.

There are a plethora of ways to enhance your customer's experience. Then, watch as the customers come to you for more and more of their purchases as they experience a business that cares about them.

Ted Leithart is the founder and president of The Leithart Group LLC and creator of C-Store Marketing Systems. The Leithart Group is a marketing and business-building resource provider for independent convenience stores. Leithart's marketing expertise has been utilized to build and enhance more than 500 small businesses. He can be reached at [email protected]. More information can also be found at www.TedLeithart.com.

Editor's Note: The opinions expressed in this article are the author's and do not necessarily reflect the views of Convenience Store News for the Single Store Owner.