My Question:
Who is your target audience and, if at all, how have you modified your store profile to meet their specific needs?
Store Owner’s Answer
“Many students visit our store and also both passers-by and local people. These people are our main source of income and the target audience also. I choose to sell items that I think they will most likely want to buy such as confectionery and snacks and also selling products that nearby stores don’t sell and having services that nearby competing stores don’t have such as oyster top-up and ATM machine access.”
From this Information, I can see that the store owner has made decisions regarding the business based on the consumer analysis that he has carried out regarding the buying patterns of people when in his store.
I then used this information to design a questionnaire suitable for their target market. In order to make a questionnaire that was suitable, I first found out from a member of that specific group of people what they thought about the business. I asked the person some questions (See Interview Sheet) and this is a quick summary of what they explained:
- Their wide range of products attract more people to the store
- Some items in the store are overpriced
- The atmosphere in the store is cramped and crowded
This information, as it was from one person could not be conclusive nor could it be very reliable so I could not base all of my improvements on it. What I decided to do was to then use the points that they gave me to see if the majority of the business’s target audience also had those opinions through a questionnaire. Here is an analysis of my results
This shows me that the majority of people thought that the products were overpriced. This also shows me that there was room for improvement when it came to pricing in the store.
Most of the people thought that the store had a good range of products for a small store, with just a small minority disagreeing. I provided the option of unsure because some people do not pay attention to the range of products when buying an item in a store. This confirms to me what the person that I interviewed said and indicates to me that this store has a reasonably sustainable competitive advantage.
A large proportion of people would go to the store more if the prices were lower but this does not conclusively point towards overpricing, as some people could just be more attracted to bargains. I think that the idea of current overpricing is still implied in this question but is mainly to find out if they could get more customers by slightly lowering their prices.
Most of the people did not think that the atmosphere in the store was pleasant, which tells me that this is an area that could be improved as the way the customer feels during and after being in a store can have a significant impact on whether not they return.
Everyone who answered the questionnaire thought that the store`s location was a good choice, this means that the store`s location is not an area that needs to be improved at all. This also tells me that they have obviously made a very good decision by locating the store where it is, and it gives me an insight into who their target audience may be.
From those results, I can see that a large amount of people (50%) thought that the customer service was satisfactory and a small amount of people thought that the customer service was good. The result also shows that a third of people thought of the customer service as unsatisfactory. This tells me that there is some room for improvement here.
The reason why I asked this question is because I wanted to know exactly what it was that attracted people to this store; so that I could see if there were areas that could be improved such as the store lay out which from these results does not attract people currently. What I found was that the most selected option was “The store is on the way to work/school” this tells me that a lot of the store’s income is from passing trade.
I then used that information obtained from the questionnaires to see what areas of improvement there were and I designed a questionnaire to find out what the store owner was doing to utilise the potential of the store and if they had already noticed and/or worked on areas in which the store could improve. These are the questions that I asked him and his responses:
Do you like the location of the business? Why?
I like the location of the store because it is near a school and also close to a train station. This means that hundreds of people pass my store on foot every day.
What do you think of your range of products in the store?
I think that I have a good range of products that bring a lot of people into my store and the shops nearby don’t have a range this wide.
What competitive advantages does your store have?
I cannot discuss all of my competitive advantages but what I can say is that my store is closer to the school than a nearby store that sells items that I also sell and also my store is open during both rush hours and but the other store is only open during one.
What are the prices of your products based on?
I base my prices on how much I get it from my suppliers and they also depend on the current economic situation and bills.
This tells me that their prices are based on the variable costs of the products when they get them from suppliers and they also said that the economic situation can affect the price. This would probably mean that in a recession.
What things would cause you to change your prices?
If I put something at a certain price and only a small amount of people bought it, I would put the price down so that more people will buy it. If an item is expiring, I would change the price to a low price so that I will still be able to sell it and not make too much of a loss.
What do you think about the prices of the items that you sell?
I think that my prices are quite high but I am trying to make a good amount of profit so that I can keep the business stable.
Do you think that there are items in your store that are overpriced? Explain Why?
Yes, I do think that there are overpriced items in my store. The reason why some items are overpriced is because we are open at times that the nearby shops are not and offer services that are unique to our store in this area. Because of this, we have higher bills to pay than other nearby businesses so we need to finance it through over pricing.
What do you think about the atmosphere in your store?
The store can get very busy at times which means that it can be noisy but at other times it is much quieter.
What do you do in terms of customer service in the store?
There is not that much space in the store so we cannot provide a very good customer service during busy times but we try to get along with the customers whilst also keeping the customers flowing.
Do you encounter any problems with customers?
Yes, I sometimes have problems with shoplifting in the store and it is hard to keep track of because of the fact that the store is usually crowded.
What do you do when your store is crowded?
When my store is crowded, I try to tell the customers to speed up. Some people take it badly but if we don’t do that, people might wait for a while outside.
From this information I can see quite clearly that the business owner is quite aware of the overpricing and slightly aware of the unsatisfactory atmosphere. I can see from this that the business owner has chosen this place very carefully and it was a very good idea because the place has a lot of potential. I can see the acknowledgement of these issues but I cannot see any plans to change them. Overpricing can be a bit of an issue for people with a tight budget but the store would have to increase their cash inflow and reduce unnecessary cash outflow.
The area of improvement that I have decided to focus on is improving the atmosphere in the store rather than stopping overpricing because of the fact that this store is in a prime location and so the fixed costs would be quite high. Both my customer questionnaire and my store owner interview point toward the fact that the store has room for improvement which would lead to an increase in its amount of return customers and reputation by providing excellent customer service and a pleasant shopping environment.
The way I propose they do this is as follows:
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Changing their current dark blue rough vinyl floor to a light shade of blue. This would not only reflect light well but would also match the blue exterior of the store. The reason why this is important is because in the questionnaires some people commented that the store is somewhat dark.
- They should change the colour of the celling changed from green to cream, to further improve the distribution of light in the store. This would help to lighten the mood of people that go to the store and think better of the store atmosphere. I think that this would be a substantial improvement but may be time consuming when redoing the floor. The store is quite small and because of this, I do not think that re-paining the roof will be an expensive development, whereas the floor could cost a greater amount.
- They should also have a limit on the amount of students allowed in the store. From looking at the size of the store, it would be most suitable for a limit of 6 students at a time. This would not only make the store less crowded and cramped but it would make the store easier to navigate and would help to discourage the shoplifting that they are experiencing problems with as the owner said in the interview. This would not cost anything to implement apart from a simple sign on the door and a member of staff to manage the flow of people.
I have made my improvements based on the information that I obtained through my various types of research, and the points stated above are my final recommendations. I think that the store overall will improve if these ideas are implemented and be more welcoming to new customers.