Former GAME boss says UK retail "isn’t properly managing customers"

Ian Shepherd has said that UK retailers are routinely failing to correctly manage their customers.

I’ll go out on a limb and assert that there is no retailer in the UK properly managing its customer base, including the ones I’ve worked in,” he wrote on his blog Moving Tribes. That’s because doing so means changing almost everything about the way the operation works.”

He goes on to detail what he sees as a simple” equation that retailers who depend on regular, repeat costumers should observe.

If you make Number [the number of customers you have], Loyalty [how long they stay with you] and Spend [how much they spend with you each month] all move in the right direction, good things will happen to you. If not, you are in trouble. I told you it was simple.

Here’s the thing, though. The same basic logic applies to all businesses, not just to subscription ones. And yet, outside the world of the telcos and financial services companies, very few businesses manage themselves in this way.

Take retailing as an example. Walk down your high street, and 9 out of 10 of the retailers you pass would not even know what those three key numbers are today, let alone how to make them go up. Ask a retailer how many customers it has, and it will start talking about footfall”, but that isn’t the same thing at all. Footfall measures the number of anonymous people who have walked into your stores, not how many actual customers you have.

When you get to the Loyalty and Spend, and start asking about customer lifetime and customer value, things get even worse.”

Shepherd resigned as CEO of The GAME Group after the retailer entered administration on March 26th.