Putting customers first and instilling AutoZone brand loyalty has always been a motto for the automotive retailer and distributor. During the company’s recent fourth-quarter earnings conference call, AutoZone CEO William Rhodes said,
“We’re rededicating ourselves to live the pledge”. “Our pledge starts with always putting the customer first and, therefore, we’re always looking for ways to improve our model.”
There are significant opportunities for new store growth and to also improve productivity in existing AutoZone locations. Over the past two years, new methodologies have been implemented that have improved hard parts placement techniques, testing more frequent deliveries to stores, and expanding parts availability in mega hub stores. A new store prototype is also in the works that will significantly expand the hard parts holding capacity in stores. All new stores are now opening with the prototype. Increasing inventory levels have added incremental costs, but sales are justifying the investments and meeting the customer needs for these products are securing brand loyalty. AutoZone had concerns that too many customers were leaving stores without their needs being met. Making these system enhancements and reducing out of stock SKUs will be a direct benefit to the customer.
The first major test was to increase store replenishment from their respective distribution centers. Once stores were only getting weekly deliveries, that has now increased to three or five times a week. Over the next 12 months, AutoZone expects to roll out this increased frequency model to an additional 1,000 stores. Increasing the number of mega-hubs in 2016 is the second major test for AutoZone. Mega hubs are super-sized AutoZone stores that carry between 80,000 and 100,000 unique SKUs. These mega hubs will continue to strengthen the customer experience to allow more items to be in-stock more frequently. Staying aware of customer needs to secure AutoZone brand loyalty is a tried and true strategy.
What does your company do to make sure they are keeping customers loyal to your brand? Comment below and let us know! Gift cards are one of the many ways to satisfy customers and get them to stay loyal to your brand. The AutoZone gift card is available at a discount when purchased in bulk.