Monday, January 6, 2014

Reputation and the Bottom Line

Reputation can make a BIG difference to a marketer's bottom line. What makes or breaks a retailer's reputation? Employee attitude...customer satisfaction...price and product availability...support for local communities...sustainability...and delivering on promises.

 
Costco is a great example:
  • "Costco CEO Leads the Happiest, Cheapest Company in the World," was Bloomberg Businessweek's cover story in June, 2013. Its employees are well paid, they have good benefits, and they're highly motivated to help shoppers. Markups are reasonable, so customers feel prices are fair. And of course, the "treasure hunt" aspect of Costco's merchandise assortment adds to the retailer's appeal.
  • "Thinking Outside the (Big) Box," a New York Times article, quoted Professor Zeynep Ton saying that employees "are not merely a cost; they can be a source of profit--a major one." Better-paid, well-trained employees don't just help customers, they're committed to supporting their retailer employers' goals, which is what happens at Costco.
  • "Costco Rides into Town on Reputation," said a headline from the Sioux Falls Business Journal in the fall. The article explained that Costco focuses on positive relationships with members (shoppers) and employees. Local residents eagerly awaited this new store opening.
Employees are a major stakeholder group, and if they're satisfied and dedicated, they are in a much better position to satisfy customers. For Costco, this has translated into higher sales and profits, year after year. Reputation has definitely added to Costco's bottom line!

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