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Transforming The Customer Relationship - Palms Trading

A case study on Voice of Customer Marketing (VOC)


• Founded around 1919
• Offers a huge inventory of Pueblo Pottery and Native American jewelry
• Its 5,000-square-foot showroom in Albuquerque, New Mexico, displays thousands of pieces of Pueblo Pottery, even more Native
American jewelry, and hundreds of Navajo rugs, Hopi and Navajo kachinas, and similar Native American handmade artwork.

Web site :  www.palmstrading.com

Some of the most beautiful Native American handcrafted artwork can be found at the Palms Trading Company, one of the most successful wholesale and retail purveyors of Native American arts and crafts. A familyowned business, Palms has roots in the frontier days of the early 1900s. Over the years, it has established a reputation for providing a large selection of authentic, highquality collectible Native American pottery, jewelry, kachinas, and hand-woven Navajo rugs.

The core business is serving consumers who visit its Albuquerque store and wholesalers who sell the merchandise from their own stores. Palms also caters to a small but loyal group of collectors of upscale Native American art. According to Guy Berger, president of the company, “My relatives settled in New Mexico in the 1800s, thanks to the Homestead Act. Our challenge today is to maintain our legacy as a small Native American Trading Post, yet appeal to a new generation of buyers and collectors who need to be educated and engaged, yet have limited time and patience.

“The goal is to get people into a relationship with Palms so they self-profile their interests regarding pottery, jewelry, and rugs and indicate how they want to do business, that is, any combination of brick-and-mortar retail, phone, trade shows, or the Internet. Additionally, we want to maintain our relationships with the multiple generations of consumer buyers, retail shops, collectors, and the Native American artists from whom we buy art. “By helping us to conduct our VOC Relationship Research program, Ernan helped us implement twenty-first-century marketing practices in ways that supported the development of our 75-year-old business.”

The Objectives of the VOC Research

Guy’s reasons for conducting the VOC research were to improve average order size, identify ways to establish longer-term relationships with
customers, and understand why certain wholesalers were not purchasing from Palms. Specific VOC objectives were defined as understanding the following:

• How do customers perceive Palms’ strengths and weaknesses?
• How can Palms improve customer relationships, and how will this contribute to increased sales?

• What do customers expect from Palms, and how does Palms meet those expectations?
• Why don’t certain companies purchase from Palms?
• How can Palms provide ongoing value and relevant communications going forward?
• What are retailers’ perceptions of the clarity and integrity of the wholesale prices that Palms charges?

The Research Sample

Based on these objectives, we interviewed eight people from each of the following groups:

• Decision makers at retail outlets currently buying from Palms
• Prospects from retail outlets not yet buying from Palms
• “Resistors” from retail outlets that weren’t engaging with Palms

The Questions

1. How important are Native American arts and crafts to your product line?
2. For Native American arts and crafts, how many suppliers do you order from?
3. What are your criteria for choosing a supplier of Native American arts and crafts?
4. Are you staying with your current Native American arts and crafts suppliers, or do you periodically consider changing or adding others? Why?
5. What might cause you to change suppliers or add a new one?
6. What would you say are the strengths of Palms Trading?
7. And what would you say are the weaknesses of PalmsTrading?
8. What can Palms Trading do to provide you with exceptional service and value?
9. Have you purchased from the Palms Trading Web site?
10. How satisfied were you with your experiences using the Palms Trading Web site?
11. What would make purchasing on the Web site an even better experience?
12. Have you purchased by calling Palms Trading?
13. How satisfied were you with your experiences when you called to order?
14. What would make purchasing by phone from Palms Trading an even better experience?
15. How satisfied were you with your experiences when you purchased at our store?
16. What would make purchasing at our store an even better experience?

The Takeaways

Perhaps the most surprising outcome of the VOC research we conducted for Palms was the one that uprooted a core assumption of Guy’s: the idea that certain wholesalers were predisposed against buying from Palms. This turned out not to be the case. As one respondent put it, she would be happy to place an order “if Palms called regarding my inventory of XYZ, asked what I needed, how could they help. I would also want someone I could e-mail with a question and a contact who knows my range of products, develops a rapport, and understands my style needs. That person must be patient and must get it right!”

Responses like this indicated that so-called resistors would be willing to do business with Palms, given their impeccable reputation, if only Palms would proactively reach out to them. Repeatedly, interviews told us that knowledgeable, caring, honest customer service was an important competitive differentiator—far more important than Palms’s pricing, which respondents found fair. What people wanted was a better connection with the company, via face-to-face, online, and telephone interactions.
As a result, Palms expanded its Personal Shopper customer service program, which it had developed for its retail clients, and it tailored the program for this wholesale group.

“Following the lead of what we learned in the VOC research,” Guy said, “we created a more advanced Personal Shopper program for our wholesale clients to make them feel comfortable and enrich their ‘Palms Experience.’ Additionally, each of our wholesale clients was assigned a Personal Shopper, or, as one interviewee put it, ‘a go-to person’ with whom the client could work closely to identify his or her specific price ranges, Pueblo, style, and other preferences. Personal Shopper is our proactive customer service program that educates customers, probes to identify their interests, and enables us to search for their special items in the store, on the Internet or in the Native American Pueblos. Upon finding the item, they are immediately contacted by their Personal Shopper. Our goal is to give our clients the most complete, informative, and pleasant experience we can. This is the difference between our Personal Shoppers and what most people think of when they hear the words ‘customer service rep.’ Moreover, our program is especially valuable in this industry due to the unique and sometimes very rare nature of the products requested.” In addition, it was critical to expand the Palms opt-in database.

(You’ll be learning more about opt-in initiatives in the next chapter.) The expanded opt-in program consisted of various channels:

• An in-store Personal Shopper Opt-In form, which Personal Shoppers were trained to ask each customer to complete
• An electronic form on the Palms Web site that included the Personal Shopper Opt-In form
• The Indian Art Update e-newsletters that customers could opt in to receive, and updates regarding new inventory that customers could also opt in to receive by e-mail or Personal Shopper calls
• Personal invitations from Personal Shoppers to their respective customers

According to Guy, “‘Personal Shopper’ is not just a term we use to describe someone’s job; it’s the way we do business now. This new level of service is incorporated into all of our communications and personnel training. Our Personal Shoppers are continually retrained regarding how to provide our clients with value-added information. Our staff is taught how to find pertinent information on artists—their work and their specific lineage. Items that are not currently in stock, unusual requests, and hard-to-find pieces are also a specialty of the Personal Shopper. Our goal is personalized and informative inbound and outbound customer service that benefits both our customers and Palms. This is a clear and easily distinguishable difference between a ‘customer service rep’ and our Personal Shoppers.” The VOC initiative also helped Palms to create several Internet strategy initiatives (www.palmstrading.com) to enrich the online  experience:

• Provide rich information that puts the art objects in context - from artist biographies to lists of dates and times for Native American feast days and dances.
• Keep a large amount of inventory visible, and update it frequently because these items are handmade and of limited availability.
• Guarantee that the merchandise we sell is authentic.
• Continue to upgrade the site to improve ease of use and navigation.
• Make sure the site is safe and secure for customers by displaying the “security lock” icon, which is backed up by our security certification. This is especially important given the constant concern of fraud in the Native American arts industry

The Results

Guy’s original goal had been to grow bottom-line sales by 5 percent year to year. The actual results in the 12 months following the VOC program were considerably more robust:
• Sales increased 10 percent year to year.
• The opt-in database grew 470 percent over original projections

According to Guy, “I credit the increase in sales to the power of the VOC research and the Personal Shopper program it helped to improve.This program pushed us to be proactive in caring for and servicing prospects and customers through all of our channels. I also learned a valuable lesson in how much our customers wanted to hear from us, as long as it was relevant and provided benefit to them.”

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