Selling for fun & profit: in tough times, the `customer-focused' campus bookstore is becoming one heckuva revenue generator

University Business, April, 2003 by Nicole Rivard

Historically, the university bookstore has been a basement dweller--necessary but not necessarily profitable, tucked into the campus's cheapest real estate and easily overlooked. But with so many higher ed budgets slashed due to state and local economic woes, the campus bookstore may now be just the revenue generator schools have been searching for. At least, that's what customer service guru Patricia Seybold was selling at March's CAMEX (the National Association of College Stores' collegiate retailing show), and attendees were pricking up their ears. After all, many of them had recently received the mandate from senior administration: Make that store a moneymaker!"

The Customer Is Key

"It's a customer economy," says Seybold, author of Customers.com (1998, Times Books) and The Customer Revolution (2001, Crown Publishing). She insists that the best practices and core competencies of successful companies can--and must--be transferred to the collegiate retailer. Those companies, she points out, know they're now operating in a "customer economy": one that's moved from a supply "push" mode to a demand "pull" mode catalyzed by the Internet. Customers are more demanding than ever before, she says; they have so much more information at their fingertips.

"A successful bookstore retailer has to create a shopping experience customers will love, and then `brand' the experience that is delivered," she says. "What do your customers want? That's the question. While price is important, there are other things customers value: convenience, atmosphere, how easy it is to do business with you, and how easy it is to get what they need."

What does the customer want? Key to creating the type of retail experience customers keep coming back to, says Seybold, is finding out what--in a very specific way--matters most to your customer. Once you uncover those essential needs, she advises, focus on fine-tuning your ability to meet them, and make them your core competencies; the things you do best. Then make sure your customers and potential customers know that's who you are: brand the experience.

Focus groups/scenario mapping. But how do you get to square one and uncover those customer needs? Seybold suggests holding focus groups to elicit feedback about how you already operate your bookstore. Or, go the more interactive route and institute "customer scenario mapping," a technique by which customers literally co-design the manner in which they want to do business with you. In customer scenario mapping, says Seybold, the retailer gathers a group of customers with a common demographic (e.g., either students, alumni, parents, or faculty) and encourages them to discuss the key issues they care about. Each of those groups, she explains, faces "moments of truth" in their shopping experiences: how convenient it is to obtain academic regalia at graduation; how easy it is for the academic departments to submit book orders; availability of used books prior to start of classes; etc. In such sessions, she says, a smart retailer will learn quickly that no matter what else he may be doing, if he doesn't get these things right, customers will be turned off.

That's where the measurement of key factors--or "metrics"--comes in. For instance, say you've discovered that your customers leave the store when they encounter long lines, and head for Internet or local competition. Your attention should then be focused on increasing checkout staff at crunch times. Yes, your metric for the cost of increased staff resources will go up, says Seybold, but if it is compared to the declining metrics of the dissatisfied (lost) customers and actual lost sales caused by long checkout lines, "You will see very quickly the benefits of having those extra cashiers," she says.

The customer "sat" survey. To help bookstore managers measure specific satisfaction metrics, NACS offers both customer satisfaction (www.nacs.org/public/ research/customer.asp) and faculty satisfaction (www.nacs.org/public/research/ faculty.asp) survey services. Such a survey proved to be a valuable tool for Lynette Seymour, manager of the Iowa State University bookstore, in Ames. The survey results revealed that customers wanted the store to provide more convenient book buyback and more used books. With those metrics in hand, Seymour moved the location of buyback from a meeting room in the student union (located on a different floor than that of the bookstore, and without direct access to it), into the textbook area of the store itself. To create a flexible space to accommodate buyback, she tore down two rows of shelf fixtures and replaced them with rolling shelves. The result: an immediate 9 percent increase in store buyback units. Used book availability automatically increased too, but focusing on what her customers had told her about the acuteness of their needs, Seymour saw an opportunity to do even more: Before classes resumed, she blitzed the faculty with letters, postcards, personal calls, and ads in the faculty/staff newspaper to encourage them to make sure the books needed for their classes were ordered or on the shelves. This gave the bookstore staff more time to mine the used-book companies for the titles. Result: Used book sales climbed 11.5 percent for the semester.