David vs Goliath™

Independent and regional retailers across our country are faced with the same agonizing challenge in markets large and small. For years they have invested in building a successful hands on, service oriented small business. They've developed long term customer relationships by delivering genuine customer service and for years have gone the extra mile in providing high quality merchandise and standing behind it with their reputation. Then along comes a national big box chain. The big box chain deploys big box ad budgets offering heavy discounts and a saturation of advertising in the market. Initially this lures some customers away from the smaller retail company. The smaller company appears to be at a disadvantage, however, as Thomas Friedman so aptly states in The World is Flat, the technology and communication advantages once held by larger companies are now available to companies of all sizes large and small. In the case of regional retailers competing against national brands, by assembling key customer transactional data, prioritizing this data to identify the 20% of customers driving 80% of profits, and then increasing retention and profitability, the smaller retail company can now compete and in fact win against their big box brethrens. The smaller retailer is not going to out gun the big national chain by advertising at the same level. Instead, by targeting top customers through a consistent contact strategy and driving incremental sales from their best customers, the "little guy" will soon be able to sharp shoot the weaknesses of the slower, broad brush, big box stores. It's a little like David going up against Goliath. For David his key tool was the slingshot, for the independent or regional retailer their "slingshot" is the customer database.