So much of chain retail has an issue with boring, even as the nation returned to in-person shopping this year. The Plan-o-gram department rules, and merchandise mixes, decided from top down, are dependent on execution at the retail level. The problem is that no chain can have enough imagination in the buying department to execute down to the store level in such a precise way, except for retailers with extreme discipline (i.e. Target, Publix), or monopoly/monopsony positions, like CVS, with its annoying and repetitive sales stickers that block products.
Yet as retail has returned, there is renewed potential to make it thrive.
The lockdown bored shoppers; they learned nothing new. Only repeats of the old. Not all can be found in an Amazon search. And think of the negatives of Amazon. These are obvious, but need to be said again:
- If not the top brand, the merchandise might be (or is) junk from China.
- Other than familiar, repeat products, customers can’t be sure of sizes, or colors, or feel.
- It comes in a giant box, or awful packs, and it really is a pain to return. It may not even have a clear return location, and taking it to Kohl’s is a waste of time for something $15.
- Part of retail is suprises; much of what you buy at a store is suggested by being in the store itself. Impulse shopping is time tested.
- Retail is social. And now that we can see people’s faces, it is fun again, particularly when the crowds are people like us.
Amazon knows this:
- They bought Whole Foods because they needed to connect with people, and get some ideas.
- They send Christmas catalogs because people need to dream, and they need to burnish their brand.
- Their automated stores have not taken the U.S. by storm.
- Their once-spiffy, trucks, new a few years ago, are battered.
- Their once-eager delivery people, clad in polyester, now have the enthusiasm and sweaty feel of a 1980s Burger King cashier.
- They are slowly realizing that their web services may be easier margins than home delivery.
- Part of their business model relied on the U.S.P.S. to ruin its trucks, and people, delivering packages for no profit.
- Automated package delivery, by robots, is not coming anytime soon.
- Their delivery model copied something that grocers eliminated decades ago, the home delivery. Their technology helps to make it easier, but it is still selling low margin goods with high margin costs.
This is not to say that Amazon won’t rule the world still. Or that somehow most Americans are suddenly going to give up the Amazon habit. They will not. Instead, it is the reality that the obsession with Amazon has made retailers themselves forget how much fun, and how interesting, retail can be. And that in person retail is the majority of shopping.
Certainly shrink is an issue with a return to retail, but that only happens in Soros cities where normal, English common law is neither respected nor enforced.
Some great old retailers have not learned. Go to a Macy’s. The merchandise is predictable. The selection is thin, and the help is far far away. Often the merchandise is a mess. Each store has the same thing, and its drab. Contrast that with a Dillard’s, where help is plentiful, the stores are stocked, and awful, trashy store brands are nowhere.
On top of this, there is the planogram. All national retailers use some sort of planogram, but that does not mean that they need to rule the world. The buyers need to allow store managers some autonomy. You need to merchandise your own store, and that cannot be done by some underpaid person sitting at a computer.
For an example of balancing national to local, consider HomeGoods. The TJX retailer HomeGoods lives on expectation, and finding. You can’t find what they have online; you have to buy it if you want it, because it might not be there the next time. You have to go in, and the trucks come every week with new stuff, that is priced to sell. Each store has different selections, too.
HomeGoods also has an element that many other retailers do not consider. They follow the Stanley Marcus tradition of crazy, special goods, that are patently outrageous.
Last year, at their Venice, Florida store (see photo at top), they moved the merchandise around for a giant Cinderella carriage. It was the height of impractical. It had no roof; no shade from the sun. It would hardly be dragged by a golf cart before it might break. But they brought it into the store, moved the shelves, and put it there, for people to wonder.
The clerks said someone will buy it; the customers around it began to consider what they might do with it, as if it were a practical thing. Would the grandchildren like it? Could you use it for a wedding planner? Would it look nice as a garden ornament? Do you just want to buy it for the heck of it, because it was different?
The question for all retail. What will surprise your customers? What will intrigue them? It doesnt have to sell; or you only have to sell one of them. What is that will get customers in a buying mood?
About 23 years ago, I interviewed Macon Brock, founder of Dollar Tree, at his headquarters in Chesapeake, Virginia. At that time, people marveled at Dollar Tree’s success, doing what Woolworth did half a century before, and repeating it, to the letter. His retail philosophy steered the chain to greatness.
One of his sayings should be considered now, by all retailers. Even JCPenney, which needs a miracle, as it suffers with stores in dying malls. It can come. It can happen. The saying?
By that, he meant that Christmas, for retail, was always just around the corner, and with it, came the promise of new life, and a fresh chance at selling things. He looked for the suprise, and challenged buyers with the question. “Worth a dollar?” If the buyer thought the customer would be engaged, he tried it.
What surprises will you have in store for customers this season?