Do Drastic Measures Mean Drastic Results?

Drastic moves. That’s what has my attention this week.

Joe Coulombe, the founder of Trader Joe’s, died this week. From his small chain of convenience stores, he looked at his world, saw big changes coming and took the drastic move to open a very different type of grocery store. “I had no choice,” Mr. Coulombe told Supermarket News in 2002. “I had to do something different.”

He saw the power of private brands long before others did, and he also presented a very curated store selection with a casual vibe, complete with Hawaiian shirts.

You knew when you walked into a Trader Joe’s that it was unique among grocery stores.

Even after he had sold his business to German discount grocery Aldi, the company still was able to stay true to the ethos and store culture Joe created over 50 years earlier and expanded to over 500 locations today. Stories abound on social media about the customer experience there.

You’ll discover friendly employees who really know the products and can not only take you to where they are in the store but also inform you about how to cook them. They’ll also cheerfully tell you what pairs well with what you are thinking of purchasing. Maybe their checkout lines move fast because their minimum hourly pay is $13.29 and that respect for associates still follows through the organization.

But one thing Trader Joe’s never was was gimmicky.

I heard about a video circulating from Modell’s Sporting Goods this week. I went to their website and found the video in question posted front and center along with a spin-the-wheel gimmicky promotion and countdown timer.

Wow and on that video Mitchell Modell, the CEO, was asking for money from his everyday customers.

He begins by saying he was blindsided by a WSJ reporter who knew they had financial problems back in 2019. Shot like a version of Bar Rescue, the video called into question the leadership team trying to make this brand work. You won’t believe how awful it is until you watch it.  https://youtu.be/6H7AUvr7e30

The trouble is that all the video is about is him and the struggling stores, not the customer. He says it’s not a tarnished brand. Yet this whole dramatic drastic approach tarnishes the image.

Dick’s Sporting Goods must be smiling.

“Make me live and I have a fighting chance,” the Modell's CEO is shown admitting how this drastic effort is a longshot. 

Speaking of longshots, JCPenney is closing more stores, the retailer founded on the golden rule of customer service, said net income in the fourth quarter, which includes the holiday shopping period, plunged 64% from a year earlier. 

Does anyone believe the brand can ever recover from the drastic actions taken during Ron Johnson’s tenure nearly a decade ago that alienated loyal customers?

Not me, but we’re in a time of drastic actions.

Macy’s announced they are closing 16 of their 36 Story Boutiques. Less than two years ago, these were added with great fanfare about how Rachel Shechtman’s approach would make Macy’s competitive with a constantly evolving merchandise story. I guess not. 

On top of that Macy’s also announced they were firing 2,000 employees, around 9% of its workforce, closing 125 stores, and oddly closing their San Francisco technology center which opened just five years ago to move it to New York. Employees could apply to be rehired for those same jobs they’d had if they wanted to move. 

In an evolving retail landscape where Target and Walmart have been able to harness tech, it seems foolhardy to leave San Francisco, the heart of tech.

Contrast these drastic moves of Modell’s and Macy’s with the time Starbucks closed down 7100 of their stores on a Tuesday evening in 2008 to reteach employees how to make drinks and even how to hand them out to customers.

It was radical. It was costly. It was an admission they had to get back to the basics of being customer-focused.

And it worked. After a drop in revenue in 2007 and even with the financial crisis, sales grew 10%.

My point?

You can take drastic actions like cutting innovative tech and plead for business, but until you take the customer seriously and service them better like Joe Coulombe did and build a culture of excellence, you’ll be missing the target.

And where does that start?

You guessed it. The drastic action of asking, training, and supporting associates who interact – or don’t – with shoppers.

The only thing to be focused on is conversions and add-ons. If you don’t know your numbers. If you are grasping at straws for buzz where customers see no value…

If you’re begging for people to shop with you because they judged you by your experience and are voting with their feet not to return…

Then whether you are an associate, manager, or CEO, understand leadership is the problem, not Amazon, not coronavirus, and it starts with you.

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Bob Phibbs, is the Retail Doctor, helping brick-and-mortar retailers beat online competitors by creating experiences to move merchandise. He is a LinkedIn Top Voice and influencer. Find out more about his speaking, training, and consulting at RetailDoc.com