Retail Doom

The death of retail is nigh!!!, well sort of. In Australia as in many countries traditional retail trade has been suffering for some time. As we start to see quarterly and half yearly earnings reported we can see the plummet in profit. The problem I have is that if you ask a retailer what is causing it many will say online retailing. My answer to that is rubbish.

Traditional retailers profits are plummeting because of a multitude of reasons and I don’t believe online retailing can be the only reason. Online price comparisons does contribute however because now more than ever, people know what they should be paying for an item before walking into a shop. Yes, some sales are happening online but traditional retailers are not dead.

In this country, instead of retailers looking at their strategy they become desperate and the first sign that profits would plunge was when ‘Sales’ stopped being once or twice a year and became a permanent arrangement. This not only showed desperation but people became more savvy and started to realise that the discounts were not as great as was traditionally expected in a sale.

Another factor that is not helping at least in this country is the sad state of customer service. We all know that we get excited on the odd occasion that we actually get good customer service because it is so rare. Retailers, you need to start looking and listening to your customers because the service you offer is not even there. You walk into a shop and you either get high pressure sales techniques or non existent assistance. It’s time that you take a look at the way you have set up your businesses and the training you give to your staff as well as being clear about service expectations.

Don’t think for a minute that online retailing is not important because it is expected that your online presence and your physical presence are seamless and offer the same level of service and the same experience. What I am saying is you can’t blame online shopping for your poor sales.

What you haven’t been keeping up with is what your customers want. I will slightly disagree with some experts out there who say it’s all about demographics and analytics. Yes it is part of the picture but not all. If a retailer decides in their wisdom to undertake research they usually end up with a profile of ‘their customer’. The problem with that is that it would be ridiculous to think that if you are a shop that is spread all over the country that your customer profile will be the same everywhere. You need to empower shop staff on the ground with tools that allow them to build local profiles.

A simple example is many years ago I worked for a discount department store in a regional town. They had a very set range of products and you were not meant to deviate from that. In fact it was almost impossible due to the scanning technology. However after listening to customers I realised the set range of music we had wasn’t hitting the mark with the local market and they were heading to other retailers who were more flexible. So I tracked down a code I could use to sell generic music and ordered a stack of artists that I knew was in demand in the local area, as well as a couple of very expensive box sets that were nearly a thousand dollars each. Once the bills came in I simply sent them onto the buyer, who when they rang me couldn’t say much because I had sold all the stock. However in saying that I shouldn’t have had to find a round about way to do this. Retailers need to cater for the customers in their stores. If your customers need a quick service then give it to them. If they need more personalised service then give it to them. In the end retailers need to adapt and and have a unique selling proposition. Are you a retailer who concentrates on product or service? Think about it.