The front page of the 6/20/09 New York Times featured a fascinating article titled In Recession, Strategy Shifts for Big Retailers. According to the author, Stephanie Rosenbloom, the country's largest retailers "are seizing the moment to reinvent their business strategies."More specifically, "high end stores... will offer more midpriced merchandise. Many chains ... will carry less inventory and fewer brands. The likes of Sears and J.C. Penney will put self-service computers in stores so customers can browse collections or buy out-of-stock items. And retailers of all stripes will offer more exclusive merchandise and more attentive customer service... One of the biggest changes... is greater personalization and regionalization of merchandise."
On one hand, I consider this exciting news. On the other, I'm amazed that so many retailers have been asleep at the switch and not paying closer attention to their customers - especially when other non-US retailers [e.g., Zara and H&M] and US non-apparel retailers like Trader Joe's have.
Zara uses hand-held devices to immediately communicate product feedback. Macy's intends to send its merchandisers and other planners into stores each week to learn from the sales staff, who will "keep logs at the sales registers", and fine tune product offerings to meet the specific needs of a locality. Getting Ahead By Being Local makes sense, especially in an age where everything looks the same.
The article says that "at high-end stores, ... consumers will still be able to buy chic brand names, but at a wider range of prices." Furthermore, brands will be streamlined. "Consumers are 'time-starved' and looking for simplification in the entire shopping experience." I've walked away from purchase decisions where the choices were too many. It's exhausting to have to sift through so many choices, and I hate the negative emotions.
I'm particularly intrigued to read that "seasonal transitions for apparel will probably have shorter lead times." Makes sense to me. Retailers have been jumping the gun on too many seasonal fronts [see The Grinch Who Stole November's Christmas and Elmo Saves Christmas... But, Not From Retailers]. It's time to get back in sync as Retailers keeping clothes in sync with seasons by Anne D'Innocenzio explains. She brings up an interesting point in her article: that the change in strategy leads to a change in product quality in favor of innovations that enhance wear and durability. I'm hoping that means we can say goodbye to disposable products and instead focus on acquiring better quality products that last longer. That's sustainable.
Back to the NYT article. It brings up more designer - retailer collaborations for exclusive products, more blurring between on- and off-line store experiences with more opportunities to do research [including competitive research] in-store, and cellphone shopping [something already well established in Japan].
It also addresses an increased focus on customer service.
That's right, a lot more effort on improving the customer's retail buying experience and having knowledgeable, customer-focused sales staff on hand.
Music to my ears!
Now, although the article focuses on apparel [with a few Sears and Home Depot comments], it in every way applies to retail stores across the board including flooring.
1. Listen to your customer. Observe your customer. Pay attention to the trends that are relevant to your market place. What products styles, attributes and colors matter to your customer base? What problems can you help them solve?
2. Simplify your product offerings. Make sure they make sense to your customers. Can customers readily determine the value each offers?
3. Are your on- and off-line experiences fully integrated? Can you help customers do research within your store? Do you offer them all of the information they need to make the decision that matters to them both in-store and on-line?
4. Is your retail buying experience absolutely top-notch and memorable? From beginning to post-installation? Do you create long-lasting relationships?
Retailing is in for interesting change as strategies shift and we re-adjust to truly focusing on how to add value to our customers' lives.
Do you agree?
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4 comments:
Listen to your customers. It seems so simple. Somewhere along the way, too many large retailers got the idea that technology could trump the most basic of retail truisms; that what really counts is the personal interactions between salespeople and employees. Technology was scalable, people, especially highly skilled salespeople, weren't, they were just plain expensive. So much of what's being talked about now, in light of the downturn, is merely a welcome and essential return to retailing fundamentals. Listen to your customers. Focus your assortments on them. Focus on what happens at store level. Focus on how the customer experiences the store. Focus on the one-on-one human interactions. Very simple stuff, really.
Where do I start? Retailers, and anyone else, who forgets about customer service can skip all the rest. Who wants to buy the best-priced, exclusive whatever that they've read and heard about on billboards to smartphones from a grouch with an attitude?
And you're right about coordinating the message.
A surly creature who turned out to be the manager [!] snapped and corrected me as I asked about the location of the 50 percent-off wrapping paper advertised on signs as big as I am in the window and inside the store. "They cost $1.99!" she said in a tone that shrieked, "idiot," as she turned away, waving in the general direction of the sales merchandise. I also turned away-- and out.
On the other hand, a sales associate at Home Depot in Poughkeepsie, NY took a different approach. He escorted me from aisle to aisle according to my list, even opening a package to make sure that a washer he recommended fit the faucet part I'd brought along.
Retail is not complicated. Challenging in this economic climate, surely, but the basics remain the same: Add earnest service to fabulous product that people need or want, price it appropriately and you’ll make a sale.
Ted, aren't you amazed how difficult to execute simple stuff can be? Too many of our industries fell too much in love with big and distant, losing sight of the essentials. Especially in retail. We now have the opportunity to refocus. How novel, right?
Jeanne, great examples you bring up. What a contrast! And, yet the surly scenario happens far too often.
Here's an added level of complexity to delivering on delightful service: expectations, raised because of a stellar web experience, that come crashing down because of the surly in-store treatment.
Very simple stuff, as Ted says, but oh so critical to do consistently and earnestly.
Thank you both for adding to the discussion.
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