Trust & transparency are keys to loyalty, says Asda
Trust and transparency are the keys to earning real customer loyalty, and this means allowing customers to not only see 'behind the scenes' but also to help make key decisions about business operations, according to Wal-Mart owned supermarket Asda's president and CEO, Andy Bond.
Bond has recently outlined his vision for engaging with today's 'new consumer' in a bid to empower them, build their trust, and earn their long-term loyalty. In fact, Bond argues that the ongoing "digital explosion" and a sharp decline in consumer trust in both governments and businesses has led to a new era of what he calls "democratic consumerism", in which responding to consumers' demands for more openness and transparency requires a whole new business model.
His vision for the future is of a new model in which customers can dictate not only the way in which companies do business with them, but also which products they sell. As a result, Asda has announced a series of initiatives to "bring customers into the heart of the business and empower them as active stakeholders".
As a result, the company has launched three new commitments that aim to symbolise the first step in Asda's new phase of openness and customer empowerment, including:
- Chosen By You This represents a new "open door" policy at Asda, where anyone can get involved and where customers are consulted about every aspect of the business. Customers will be made core decision makers in the business, involved at each step of the process from product development to the look and feel of packaging. From January 2010, an existing group of 18,000 regular Asda shoppers will be given unique access to products before they go into stores. These consumers will have a significant influence on purchasing decisions made by the company by being involved at the start of the buying process, rather than at the end.
- Your Asda This will become an access all areas window into the world of Asda; rather than telling customers about what's happening behind the scenes in the business, Your Asda will show them. To enhance its web site and to drive transparency, Asda has also unveiled its new blog, Aisle Spy, and introduced a number of webcams within its operations, including a dairy farm, a carrot processing plant, and its head office in Leeds. The aim is to reach a point where customers can trace the journey of every Asda product. Asda is also to open a new 'transparent store' in Gorseinon, South West Wales, in 2010. Screens will be placed on the shop floor showing what's going on behind the scenes, and glass walls will replace brick walls, giving a unique window into areas of the store normally kept out of view.
- Bright Ideas From early 2010, Asda will also reward the customer who comes up with the brightest idea to save the business money. And, if that suggestion is implemented and saves Asda at least 2 million, the bright customer in question will earn a fee of 5% of the first year's savings (up to 100,000).
"My ambition for Asda is to actively involve customers in every aspect of the business, to lift the lid on how we do things, and enable our customers to help make decisions that have an impact on what we sell and how we sell it," said Bond, who asserts that democratic consumerism is about more than simply lowering prices. "It's about entering into a new partnership, and working with our customers rather than simply working on behalf of them. I firmly believe that customer loyalty cannot be bought with plastic points or discount vouchers; it has to be earned."