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    Building a Brand, One Customer at a Time

    At the Convenience Store News Future Forum, John Matthews explains why focusing your attention away from your brand is a good thing.

    CHARLESTON, S.C. -- Is your approach to building your brand customer-centric? Probably not, according to John Matthews, founder and president of Gray Cat Enterprises Inc. and a speaker at the 11th Annual Convenience Store News Future Forum.

    In his presentation, Matthews provided an overview of traditional branding, which incorporates elements familiar to any retailer -- trying to develop a brand that customers can identify and advertising that brand to a mass audience by casting a large net. Matthews cited as an example those companies that advertise during the Super Bowl, which will likely reach a huge number of customers that have no interest in their product and can only hope they hit enough of their target audience to make the expensive spot worth it.

    Traditional branding still has its place in retail, Matthews explains, since companies must be able to communicate to the world who they are. But with a finite amount of marketing dollars, he proposes, customer-centric branding is both more cost-effective and more effective overall.

    Rather than casting a wide net and marketing to as many customers as possible, the customer-centric model calls for directing more media dollars at your core audience, which will maximize return on invested dollars and begin cultivating loyal customers. If a retailer operates in multiple markets, for example, it makes sense for him to select markets where he can maximize the ROI of his media spend.

    But how are retailers to identify those markets? That's where the brand development index (BDI) comes in.

    The BDI automatically factors all local marketing variables into consideration: number of stores per market, strength of locations, quality of management and any other factors, past or future. To determine a region's BDI, use the following formula:

    -- Divide the total margin of the market by the total margin in the brand. This will determine the total margin percentage.
    -- Divide the number of households in the market by the total number of households in the brand. This will determine the geography percentage.
    -- Divide the total margin percentage by the geography percentage. The resulting number is the BDI, and the higher the BDI, the more likely the market is to offer ROI in media dollars.

    “It won't happen overnight. It's a migration,” Matthews said. But marketers are at a crossroads in strategic brand implementation, and augmenting traditional branding with consumer branding is a win-win for retailers.

    As c-store retailers are well aware, customers exist in a world with infinite choice. But by focusing on your core customers and marketing to them with Web-based marketing, stored value and loyalty cards, targeted marketing, local store marketing and public relations, they are a lot more likely to choose you.

    Matthews has served as vice president of marketing, corporate communications, real estate and facilities for c-store chain Clark Retail Enterprises/White Hen Pantry, as well as president of Jimmy John's Franchise Inc., a Champaign, Ill.-based sandwich chain, and national marketing director for pizza company Little Caesars Inc. To learn more about customer-centric branding, visit www.graycatenterprises.com.

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