Every day when you go to work, your goal is to generate revenue but, as the saying goes, you have to spend money to make money. Sometimes you’ve got expenses. You might have to run payroll, pay bills, or purchase consumables. These are the costs of doing business. Other times, when you commit to an expenditure, you’re not just spending, you’re investing. As you write the check, you’re asking yourself, “How will parting with this money grow my business?” You have to have a reasonable expectation of clear return.
For multi-unit locations like yours, one of fastest ways to improve and grow your business is to digitize your routine tasks. By converting from paper or Excel-based checklists to a centralized digital checklist system, you will not only help run your business even more smoothly but also ensure quality and maintain brand standards. In other words, you’ll gain quick and quantifiable ROI.
Creating Consistency Builds Brand Loyalty
Investopedia reports that, for most companies, 65% of business comes from repeat customers. Also noteworthy is the fact that inviting a happy customer to return is a much less expensive marketing proposition than convincing a new customer to walk in the door for the first time. Some estimates are that attracting a new customer costs up to 5x what it costs to attract repeat business.
61% of consumers will go out of their way to purchase from a trusted brand. To become one of those preferred brands, you’ve got to offer dependable quality of product and experience regardless of location. When you clearly define brand standards and hold employees accountable for adhering to them, you achieve consistency. Whether you’re operating restaurants, convenience stores, dispensaries, or another multi-location business, creating long-term customer relationships is the best way to increase average CLV, customer lifetime value. Every time a customer chooses to transact with your organization, acquisition cost relative to CLV goes down.
A Tale of Two Customers
To better understand how digital checklists can have an impact on this dynamic, let’s take a moment to consider two fictitious – but entirely typical and easily-imagined – customer profiles:
First, there’s Bob.
Bob needs gas. He’s a few miles away from home and stops at a gas station to fill his tank. He’s never shopped with this brand before, but he recognizes it from marketing. Bob decides to head into the convenience store while he’s there. He’s planning on picking up a sandwich and a drink, but visits the men’s room first. Although management has defined brand standards, the employee on duty hasn’t checked it in several hours. She’s planning to backfill the form on the clipboard before her shift is over, figuring that management will never know. The restroom isn’t as clean as it should be.
Bob walks out, reconsiders his sandwich, buys a $1.99 beverage, and gets back in his car vowing to go somewhere else next time. Customer acquisition costs at this chain are $1.34 per customer, so Bob’s CLV is 65¢ and it won’t change.
Compounding the loss, Bob tells his neighbors about his negative experience, posts about it on social media, and leaves a one-star review online.
One recent study concluded that 86% of consumers hesitate to purchase from a brand with negative online reviews. Another found that only 3% would consider doing business with a brand with an average rating of two or fewer stars.
Now, meet Marcus.
Marcus needs gas, too. There’s a vendor near home, but he drives a few minutes out of his way to go to his preferred station. He typically goes there once a week to fill his tank and grab breakfast on the way to work. Like Bob, Marcus pays a visit to the restroom prior to selecting a drink and a pastry, but his experience is entirely different. Store management has invested in a digital checklist system. A few minutes before Marcus pulled in, an employee cleaned the restroom on schedule and replaced the paper towels, which were running low. Her manager used his phone to confirm compliance without leaving the regional office. When Marcus walks in, the employee is back behind the counter and greets him with a friendly hello. Marcus uses the sparkling men’s room, comes out smiling, then heads to the counter to purchase his usual large coffee and donut.
As he’s checking out, Marcus notices a display near the register. His favorite potato chips have launched a new flavor. He grabs a bag to share with his team at lunch. His total transaction comes to $5.27. Customer acquisition costs at this chain are the same $1.34 per customer but Marcus comes back week after week, driving his CLV up every time.
Marcus loves his new chips. In the break room, he tells his colleagues where he got them, saying, “I never go anywhere else.” He tags the company in an Instagram post and leaves a five-star review on his favorite site. According to McKinsey, “Higher stars equal higher sales.” That same report goes on to point out that, “Even a small rise in score, such as an increase from 4.2 to 4.4 stars, often produced a meaningful improvement in sales.”
Digital Checklists Positively Impact Profits
Compare and contrast our two customer profiles. Bob began his encounter as a potentially high CLV customer but walked out as a one-and-done wasted opportunity. The men’s room didn’t meet Bob’s expectations. He’ll never return to that store and management will probably never know what happened.
Marcus spent more than he intended to and left happy and ready to do it again. By investing in a digital checklist system that holds employees accountable for meeting defined cleanliness standards, his brand of choice invested in their relationship with him. They can see an immediate return on that investment, and it’s one that will continue to grow.
Digital checklists made the difference in those two scenarios and, ultimately, in CLV.
Increased loyalty isn’t the only way that companies adopting digital checklist systems see a return on their investment. ROI is also created through:
- Empowered, more efficient managers who spend less time enforcing brand standards and more time on revenue-generating tasks
- Streamlined processes that allow employees to focus on customer service
- Data-driven decisions that are informed by deeper, faster analysis of easy-to-generate, more detailed reports
- Shorter issue response time thanks to real time information with photos and videos
- Lower shrinkage rates
- Improved inspection scores, resulting in fewer fines and lower downtime
Build consistency and customer loyalty at your locations with MeazureUp’s brand standards and field assessment tools. Schedule a demo to learn about all the ways your business can realize fast ROI with our convenient, easy-to-use mobile apps today.