Thursday, March 29, 2007

The Spin Zone...



Circuit City has a bold new plan for saving money as it faces loses. While some companies can relocate jobs to other countries, retailers cannot do this for sales clerks. Circuit City on the other hand is trying to bring out-sourcing benefits to its stores across the country. It is doing that by laying off 3,400 of its highest paid cashiers and replacing them with lower paid workers. As someone who has worked a great deal in the guest service industry in a variety of ways, and my readers who have done so may agree, this is a bad idea. In the new market, the thing that is going to make your business stand out from the rest more than anything else is top level customer service. Wal-Mart and K-Mart are doing a great job of cornering the market on sales based on income, by which I mean that those who are looking for low prices are likely to head to one of these well known chains. In order to put your brand into someones mind, and to encourage customer traffic, the image of the brand is becoming more and more important. The best way to polish a brand that is weak, is to bring in a level of customer service that attracts customers. As a shopper I have been to Circuit City, and I have been to Best Buy, when I went to Circuit City I got little help when I was attempting to purchase a lap-top. When I went to Best Buy, I got a great deal of help in selecting the camera that was best for me. What Circuit City has done in laying off its high paid workers, and replace them with lower paid workers, is to take workers that have experience, developed skill and training in customer service, with workers that will provide lower quality service. The electronic industry is an industry that is very reliant on customer service, when I go to buy a lap-top, or a camera, there is a lot of information that is confusing to me (and I know a good deal), when a customer is confused they are less likely to buy. With high quality customer service helping customers to understand the products that they are searching for, and what was best for them, they are more likely to buy something and feel good about doing it. According to MSNBC, my experience could be justified in the fact that Best Buy is the number one seller, and Circuit City is number two.

On the other hand there is a company that is making what I think it a good choice, and a choice long in coming. The Post Office is now selling what are labeled "forever" stamps. These stamps, that will go on sale April 14th, will sell for 41 cents. The stamps will be good forever, even if the price of stamps goes up. What the hope is that it will prompt sales of stamps, since it removes the concern that stamps purchased today may not be enough postage to mail a letter on a later date. In the past, as stamp prices have increased it meant the purchase of new stamps, or the purchase of one and two cent stamps and putting them on the letter with the lower value stamp.

McDonalds has taken a number of steps recently to reach out to a market of consumers more concerned about the health of the food that they eat. Now with its new product it is taking aim at a market on the other end of the dietary scale, aiming at those who seem less concerned about the amount of fat and red meat that they eat. The newest product that it is putting out is bigger than its quarter pounder, at a third of a pound. The Angus Third Pounder, will be the largest burger that it has ever served. McDonalds is actually following the crowd on this, Carl's JR, and Burger King, already have similar product that is doing well for those companies.


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