In Defense of Shops

The retail figures are out and it’s the biggest slump in 50 years. Where is everyone and why aren’t they shopping?   There are two answers to this.  One is what the media has decided and the other is  what’s really happening.

According to ‘the media’ you can’t get service anywhere, shops are not competitive, we’ve all stopped buying and started saving, but mostly we are SHOPPING ONLINE.   Let’s go through these issues.

Service – one of the oldest complaints around.  When retails slumps, it’ s because of service.  We don’t buy because no-one is there to annoy us into selling.  But we complain with a pushy salesperson…  this argument is circular.  So look at Zara or Gap, the newest retailers in Sydney and the queues are out the door.    Is less service actually an answer? no, a new store has momentum not service to offer.

We can do our research  on-line, talk to friends, get recommendations and make up our minds before we get to a store.  All we have to do is pick up the item, queue to pay and avoid talking to someone who doesn’t know what you know anyway.

If you really want service arrive at a store 30 mins after they open. Staff are fresh, not tired from standing all day, and there are no customers as yet.  The worst times for service are lunch times (lots of customers and staff are on rotating lunch breaks) or the very end of the day.  Staff are tired, riled by some idiot customer, talked out or want to go home.

Not good value or uncompetitive – well people, just shop around.  That’s what the internet or phone calls are about.   Don’t buy if you don’t like the price.  Shopping around is a core shopping strategy and will never change.

Saving not buying – had to happen.  But I will share a theory with you.  Around the time of the GFC in ’08, people, ie. me,  had too many credit cards with too much debt.  These cards were slowly choking me.  I keep getting more cards and the limits were way too easily increased.  Debt was the only existence I knew so when it was time to stop shopping I was ready.  I had too many things and was happy to slow down and think about what to buy, what I really needed, and also to finally do something about my credit cards.

If people are saving;  look at ways of changing your message to suit the new mood e.g. is your product durable and good value.

Time of Year ie. Winter – last year’s retail figures are about the same – a growth of 1% with Department stores down.  It happens every year.  The June/ July period is typically the slowest retail months.  People are either shopping for bargains or not shopping.  Any retailer with historical figures will tell you ‘it’s like this every year’

On-Line.  This is seen as the great saviour of retail, yet only 3.8% of sales via on-line.  Why concentrate all your efforts on a small part of your sales channel?   Retailers with real bills to pay for their ‘traditional’ stores should be looking at strategies to improve that assest, not ignore their stores and build on-line.

The media is telling retailers that the future is on-line.  Which most retailers understand but it’s a part of the mix not a magic money button

Reasons to Resist on-line.   Why share everything you do, everything you’ve worked to import/ discover/ create with the world?   What is the benefit of putting up your design if your customers like something undiscovered? a little bit special and different?

Lots of other retailers look at store web sites for a quick new idea.  They are stealing your ideas, your designers, your brands and re-creating your portfolio of stockists.  I know, they all talk about it and they talk about resisting the need to display all their ‘secrets’. ie. their prices, their stock selections.

Strategically; store web sites are  better used as a business card,  a quick update on stock arrivals, a few new images,  store hours and location.   Don’t give away your secrets to competitors.

Change strategies – There are always opportunities.  During The Great Depression, Myers launched a ‘Buy Australian’ campaign and also retained all their staff.   The two moods were ‘loyalty’ and ‘directed spending’ and both these strategies were success.

People are still spending,  there are always birthdays, personal treats and presents to buy.    Just re-examine your offering, your service and don’t give potential customers a chance to hesitate based on over pricing or poor service.

As always the media likes to panic and make a story out of change of behaivour.


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