Market Share Growth: Get in the Car and Drive

Market share growth is a long-term key to success. As growth becomes harder to come by, growing share of wallet is going to be answer for many companies. Having a compelling customer strategy is critical. Companies that don’t have one need to get one ASAP. Companies that have one need to press their advantage.

Most retail, consumer and luxury brands are starting to report positive sales and profit margin growth.  This is good news, but let’s face it,  the sales growth is against terrible numbers last year and the margin growth is through tight inventories and aggressive cost reductions.  And with easy comparisons until October, the news is likely to look pretty good for the next two quarters.

Unless the economic outlook improves dramatically, for most companies it will become clear that they are not getting back to pre-recession levels of business any time soon.  Going forward, growth is likely to remain muted and margin rate improvements are going to be tougher to come by.  So the real question is what are companies doing to drive market share growth?  For many companies that reduces down to this: what are they doing to drive share of customer growth?

When it comes to taking action on share of customer growth there are only two types of companies.  The first is the company that may have a corporate strategy (often exemplified by big binders of strategic and long-range financial plans sitting on shelves), but does not have a customer strategy. That is, they don’t have deep consumer insight, they haven’t developed actionable customer segmentation, they don’t have segment specific marketing plans, they don’t have truly useful customer value metrics and they aren’t part of the conversation age.  For these types of companies they need to commit to developing a customer strategy and they need to move with great focus and commitment.  Now.

The other type of company has a reasonably well articulated, pragmatic customer strategy (or they are close enough that they can realistically move into action).  With business improving and many competitors still trying to figure out what to do, these players have a once in a generation opportunity to press their advantage, whether that is through opening new stores, creating a compelling multichannel experience, developing a leadership position in location-based marketing or through many, many other possible leverage points.

The answer for both is the same: Get in the car and drive!

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Author: stevenpdennis

Steven Dennis is a trusted advisor and thought-leader on customer-centric strategic growth and innovation. As President of SageBerry Consulting, he applies his C-level executive experience to drive growth and marketing strategy for multi-channel retail, e-commerce and luxury industry clients. He shares his ideas and wisdom regularly in the press, as an industry speaker and through his popular blog "Zen and the Art & Science of Customer-Centricity"(https://stevenpdennis.wordpress.com/). Prior to founding SageBerry, Steven was Senior Vice President of Strategy, Business Development and Marketing for the Neiman Marcus Group. As a member of the Executive Committee he drove the company's major growth initiatives, multi-channel marketing programs and customer insight agenda. Before joining Neiman Marcus, Steven held leadership positions with Sears, including Acting Chief Strategy Officer, Lands' End acquisition integration team leader, Vice President-Multichannel Integration and General Manager-Commercial Sales. Earlier in his career he was with NutraSweet and the global management strategy consulting firm, Booz & Co. Steven received his MBA from the Harvard Business School and a BA from Tufts University. In addition to his consulting work, Steven is an executive-in-residence at the JC Penney Center for Retail Excellence at SMU’s Cox School of Business, President of the DFW Retail Executives Association and serves on the Advisory Boards of Invodo Inc. and Nectar Online Media. He is also active in the social innovation and education reform arena as a Partner and member of the Board of Directors of Dallas Social Venture Partners. He is currently co-leader of DSVP's investment and engagement with SMU's Center on Communities and Education "School Zone" initiative in West Dallas.

2 thoughts on “Market Share Growth: Get in the Car and Drive”

  1. Great post, Steven, and totally agree with you on “increasing customer share”. The current socio-economic climate (and for the next 10-15 years) dictates this as the only “growth’ path.

    Any growth (in any retail channel) will come at the expense of competitors. We all know the U.S. is vastly over-retailed, so there will be clear winners and losers here.

    Remember when retail was all about “location, location, location”? 🙂

    Like

  2. Having worked with Walmart inside the Home Office as a consultant for a while now, I have had a close-up view of a retail company with an understanding of all the topics you focus on, Steve. There’s tons of study inside the company about market segmentation, and new prototypes being developed on an ongoing basis to address perceived market segments. The luxury market could benefit from similarly intense study. Although for this market, it’s going to be more about the specific perceptions of a much smaller group of people. But, a productive focus none the less.

    Another observation I would make – and this is heretical coming from a man who has designed retail stores for 20 years – is that any retailer who is relying on a brick-and-mortar strategy today is not going to be in the winners circle by mid-century. My suggestion about the stores is that the store experience has to incorporate the ability to communicate immediately to the customer in the way they receive mobile communication from other sources. And the store needs to link up in some meaningful way with the information they are putting out through other channels.

    Let me give you an example. After Xmas I was making a purchase at Apple. While standing in a loooong line to check out ( why do they even have a cashwrap? I cannot figure out how they support the idea of such an antiquated piece of fixturing ) I was approached by an associate with a hand-held device.

    He asked me:
    Q:Are you ready to check out? A:Yes
    Q:Paying by credit card A:Yes
    Q: Do you need a paper receipt? A:No

    He scanned the bar code on what looked like an iPhone, scanned my card, charged it and emailed me a receipt. I left a happy man.

    This was the first experience I’ve had in a retail store which felt truly 21st century to me. My personal needs were met, I got what I wanted and life continued.

    Like

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