Transforming Retail: Creating a Valuable Customer Experience People Pay For
This is a story that I tell in my book, The Essential Entrepreneur that I wanted to bring to life!
Department stores and many retailers in Australia are finding out this lesson the hard way, you simply cannot compete on price with online retailers who are operating on a fraction of the overhead. You MUST create a customer experience that you simply cannot get online, and that people value, to bring customers in the door.
Instead of doing this we are seeing department stores and other retailers continually cut costs by reducing customer service and staff numbers to the point we cannot even find a staff member to serve us, and if we do they are so poorly paid the service generally reflects it. We are fast approaching a sad day when department stores and other retailers who don't understand this will just disappear.
So this week I wanted to showcase an Australian Men's Fashion Label that has not only survived but flourished over 34 years, is still privately owned with 24 outlets across every state and now transitioning successfully to the next generation within the family. So how has this business bucked the retail trend?
When I visit my local Calibre store at the Burnside Shopping Centre in Adelaide I am always greeted personally by Marc the store manager, who through his CRM system and good memory knows every item I have purchased in-store previously. Being a typical male my eye for fashion and putting outfits together for an event often needs a little (sometimes a lot of) help. Marc will take the time to consider what I have bought previously and match that with new items to constantly update my "mix and match" wardrobe and have me looking my best for the next special event or dinner.
The point I'm getting to here is that this is a service that would be exceptionally hard to replicate online, a service I value highly and happy to pay a premium for. So rather than chase online retailers to the bottom on price, instead think about how you could create a valuable in-store experience that you can't get online and one that people are prepared to pay for to support your additional overhead in running a physical outlet. Don't forget this needs a validation exercise with your potential customers like any new product or service development, and it may take a few iterations to get the model right.
Consistency in the service experience is also critical, in my own businesses we would set time aside regularly with all our customer facing staff to role play how we talk and present to customers to get consistency on language and the entire customer experience. Consistency is everything and the key to success!
Also don't judge me on my daggy jeans and jumper, I was walking past at the time, saw Marc and thought "I need to bring this story to life as a great example of the new world of retail for the EE community"!
