However, what we’re talking about here is the idea that you can be earning more, not so much by stocking massive quantities of new products or expanding your store but by thinking a little differently about the things you’re already doing. Often the difference between a healthy profit margin and a sick one may simply come down to making a slight adjustment in what you’re already doing.
This is most evident in two areas: how you package your existing product offerings and how you relate to your customers.
Let’s start with how you package your product offerings. I’ll give you an example that’s not specific to a pet store but it illustrates the point perfectly. In Lakeland, Fla., a 7-Eleven franchise operates just about a mile from the Detroit Tigers’ spring training complex. In February and March, customers will notice that the very first display they see as they walk in the door contains two seemingly unrelated products right next to each other: baseballs and sharpies.
So why would a 7-Eleven put a sporting good and a writing utensil next to each other? Because they know that people go to Tigertown to seek autographs from ballplayers, and players who are willing to oblige need something to write on and something to write with.
Traditional merchandising would say the two products belong in totally separate areas of the store but managers at the Lakeland 7-Eleven know this particular predilection of their customers. They abandon traditional strategies in this one instance and take advantage of what they know.
How can pet retailers do the same? What products would their customers buy in a bundle if they were offered in a bundle? Cat litter and scoopers? Food and liner? Maybe there’s a less obvious combination that an outsider wouldn’t even think of but someone who really knows their customers and their habits would be aware of it.
Speaking of bundling products, pet retailers can benefit from asking their vendors to think in terms of product combos rather than individual products. Many product manufacturers will package three or four items together rather than simply supplying everything on an individual basis. They might package four dog toys, or four snack items or a group of clean-up products. If you ask vendors how to strategize the bundling of their products, they’ll probably respond positively. It only benefits them to do so.
Know Your Customers
And that gets us back to the matter of knowing your customers. One of the main reasons for loyalty programs—perhaps the main reason, in fact—is to let you know your customers’ buying habits so you can push special offers that really reflect what they want. But it’s one thing to gather the data and it’s another thing to really push the offers, especially when you can create incentives for greater savings as purchases get larger.
The customer loyalty system can log the data and even match up products with customers based on their buying patterns. But store managers still have to make the decision to offer the deals and push them out via email, text or whatever method the system allows (and one that the customers have agreed to). Every retailer will tell you it’s valuable to get to know their customers and their needs because it helps you upsell. But let’s face it, doing it on a personal, one-on-one basis is time consuming and when you’re trusting clerks on modest salaries to do it, you might not be getting the best results out of the effort.
Automated rewards programs that do the job for you make it possible to gather the data without presenting an entirely new, time-consuming exercise for store employees, which might defeat the idea of making more from what you’re already doing.
Finally, many retailers earn extra revenue by adding services on top of products, such as dog grooming or even an on-site veterinarian who can help with routine checkups. Obviously, available space and licensing issues will come into play and knowing the interests of your customers will help you to identify whether this really makes sense.
The key is to think, “What would my customers respond to?” Stay within your capabilities but don’t think too narrowly about what those choices might be. You could be leaving money on the table.