Unit 2 Deliver Customer Service in a Business Environment _Sainsbury’s (GC01050)

Unit 2: Deliver Customer Service in a Business Environment

Task 1.1: Produce a report on explaining what ‘added value’ means in terms of customer service

According to Turnbull et al. (2016), added value means the amount added to the value of a product or service, equal to the difference between its cost and the amount received when it is sold. Wages, taxes, etc. are deducted from the added value to give the profit. First off – it’s not always about money or discounts. Of course, these do add value but they are far from the only way to add to customer experience and sometimes won’t have the desired effect. Think about it, if Sainsbury has had a bad experience as a customer – maybe a product hasn’t been delivered on time – a discount on a future purchase may not be that well received. Perhaps a simple message explaining the issue and providing an accurate update on the situation (and an apology) would be more valuable to Sainsbury as a customer at that moment of time.

Having said that, offering a discount or voucher will probably give its communications greater clout in certain circumstances. The key is knowing when what is more suitable. In order to apply the correct value to the correct customer at the correct time, Sainsbury needs to have a thorough understanding of its customers and a flexible approach to interacting with them. The ability to do that relies on having accurate data and having that data compiled so that Sainsbury has a complete and robust view of each customer, plus the necessary tools and systems in place to implement its messages.

Sainsbury needs to know its customers in order to add the relevant definition of value to improve their customer journey and experience.   Sainsbury should always look to add value because if Sainsbury is not, all Sainsbury is really doing is talking about itself. Even its most loyal and valuable customer doesn’t want to hear Sainsbury talking about itself. They want to hear about themselves and all the great stuff they can have, do, or get involved in.

By definition, a business that is adding substantial value must also be operating profitably. Finding ways to add value is a really important activity for a start-up or small business.  Quite simply, it can make the difference between survival and failure; between profit and loss.

The key benefits to a business of adding value include:

– Charging a higher price

– Creating a point of difference from the competition

– Protecting from competitors trying to steal customers by charging lower prices

– Focusing a business more closely on its target market segment

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Task 1.2: Recognize the opportunities to add value to a customer interaction

According to Vandermerwe (2017), to generate sales without cutting margins and avoid partaking in this race to the bottom, retailers should think about how else they can offer value to their customers. A sure-fire way that retailers can do this is to provide a service that shoppers cannot get elsewhere and are willing to pay a premium for.

Below are five ways that most retailers are able to add value to their customers:

Service

It may sound simple, however, the truth of the matter is that shoppers are much more likely to shop with Sainsbury again and become loyal customers if Sainsbury offers a better experience than its competitors. Retailers can ensure that they are meeting and exceeding the expectations of customers by providing training in the delivery of customer service to new and existing staff, and regularly providing refresher training.

Expertise

Shoppers prefer to buy from people rather than faceless Sainsbury, so they really value it when retailers offer them expert advice. This can transform the shopper and shopkeeper relationship from being purely transactional to being something much deeper and as a result, can be a great way for businesses to build preference over a competitor. For instance, a fashion retailer could offer customers free appointments with personal stylists to help them pick out garments that flatter their figures and are within their budget.

Exclusivity

When Sainsbury is selling the exact same product as its competitor it can be difficult to justify a higher price, especially in incredibly competitive markets where price changes are closely monitored and scrutinized. However, savvy retailers have realized that many shoppers are willing to pay a premium for items that they can’t buy elsewhere. This offers stores an opportunity to attract customers by offering limited edition products, such as a pair of shoes designed by a local designer or a signed copy of a book…………..

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