Great! Who Removed Humans Out Of The Service Equation?

Six risks competitors face everyday - their chaos is your opportunity

Technology has accelerated the pace of change and shifted competitive positions. Competing in any landscape is not without challenges. There are no guarantees, even with a significant investment in technology and upgrading staffing.?Knowing your competitor's weaknesses represents opportunities for your business in their moments of chaos.?Things that you are not taught in business school. Primarily how to take advantage from your competitors weaknesses. There are six truths when it comes to competition and competing. 1. The ability to?keep up with new disruptive competitors and forces?is a risk for retailers with insufficient competencies and capabilities. At some point, every brand reaches its end and needs renewal. 2.?Sustaining digital strengths?requires being timely in shifting direction and a vulnerability if they take too long to change. 3. The ability to?innovate and be innovative?in the eyes and experience of consumers is difficult for those without the proper organizational structure. Therefore they end up chasing trends versus creating them. 4.?Talent retention, for many reasons, workers are moving elsewhere with their competitive skills and knowledge. Losing critical talent weakens a competitor, even if for a moment. 5. Retailers that?don't spend enough to understand consumer behaviour?also neglect understanding external issues and opportunities. This is especially true in uncertain economic and geopolitical times. 6. When it comes to competing in this new world it requires brands and the leaders behind them to?be strategically unpredictable to survive and win.? What they don't teach you in business school is how to crush your competitors that's why the first six are important to understand and explore when it comes to growing share and retaining it. So few are understand that things are not always civilized between competitors. Winning and staying in business is paramount. For example. technology and marketing are weapons but they are only as good as the people behind them.

A soft landing that can hurt retailers and consumers

In brief, we all know about the economic challenges ahead. Inflation and higher interest rates will impact retailers and many other consumer-facing businesses. However, what will hurt the most is that higher interest rates as a policy are designed to force consumers to save more and spend less. In essence, we need to curb spending to slow down inflation. A difficult place to be. While central banks worldwide are hoping for a soft landing, the unjustified attack on Ukraine by Russia is creating inflation and other economic risks. The shutdown of cities in China because of the Pandemic will impact manufacturing. The bottom line is that a recession looks possible, and there is no sign of us getting out of this until the end of 2023. That is, if these policies work. A recession has a low probability at this point; however, they said the same thing about inflation during the peak of the Pandemic, that it was just transitory.?Read more

Who removed humans out of the service equation?

If you are looking for a marketing strategy, innovation or further technological disruption to improve your overall competitive advantage, that's not what this is about. This is about doing something very revolutionary! Putting humans back into the customer experience model on all sides of it. Of course, it is an expense but it is important if you plan to have stores and a brand. Most of what is happening in retail is all self inflicted and unfortunately for good retail operators they are victims of the experiences consumers have had in larger better known brands. Creating a switch to more e-commerce. The problem with customer experience is that it has no real plan, brand or employee engagement connections within most organizations. It is about filling shifts and doing tasks instead. It is not about an experience no matter how much you change visuals, merchandise and your selection of music. Human beings want to be served by people who are dedicated in their service behaviours. There is a lot in the news about staff shortages and quality of hiring. But hiring is about behaviours and personality fit and then you add training. You don't hire a competitors staff for their skills, it just a strategy that fails. Develop from within, it is time consuming and it has costs. These training programs must be yours and not someone else's thinking of service. That never takes root. Many e-commerce retailers are adding stores, if they are smart they are hiring and training effectively. These are two skills that are getting weaker in many organizations, interview and selection and training. This is not revolutionary but it is part of retailing that has been forgotten. I also offer you a complimentary read of Chapter 27 from The New Bricks & Mortar Future Proofing Retail (there is no subscribe button or email needed to have access).

Pricing - bundling products and services to close a sale

Pricing strategies are key in any economic environment. However, today we need to consider pricing as a bigger component of strategy in the absence of true and unquestionable differentiation. And of course pricing of any commodity where there is a great deal of existing or growing competition makes it even more challenging to find and deliver differentiation, it's not impossible although the question becomes is it sustainable? In the case of Peloton who this week announced a drop in prices (read more ) for their exercise equipment and an increase in subscriptions. It looks like a good strategy to sell more exercise equipment provided buyers don't balk at the subscription prices. This ties back to our next big idea in retail above. Pricing is an issue for retailers and consumers, the latter want the lowest price for the best product and that may need to be attached to a lifetime service or subscription going forward. The retailer wants the highest possible margin even in an inflationary environment. As a retailer you need to prove how your offer is superior to competitors that sell the same brands and models. The secret is in your ability to offer something that is both tangible and deliverable without questions or hesitation when it comes to building customer loyalty. I don't believe you can price at inflationary levels and offer no promise of exceptional service or guarantees. This is especially true with the hyper browsing that is happening today by consumers looking not to over pay. Peloton may have found a way to do just that.

Be The Last Retailer Standing

Everyone wants to be in this enviable position to survive the fights of all retail fights, physical and digital, and in the end rule the retail world in whatever matter it evolves. If retailing were only that easy! Success in retailing is complicated and despite ideas out there that it is all about one of or a combination of these; buying, merchandising, pricing, consumer models, business models, digital strategies, marketing, service at the frontlines and topped off by operational execution on everything (the list no where nearly exhausted). A brand is only as good as the sum of its parts and the story that it conveys and lives through its stores, employees and customers and then repeat and evolve to the next rendition of creativity. Everyone wants to know what is the next iteration in all of the above? The answer in short is you can't guess or borrow ideas to retail success because it short-lived that way. (please see the January 16th issue here on LinkedIn.)

Technology for retailers

As we all know 2007 was a transformational year, the long awaited Apple iPhone was launched. This began the decoupling of consumers from their desks and their homes. Ever since then many have tried to predict the next generation of technology. This article from Economist highlights what we expected and expect. However when you meet with a number of startups in the technology sector after careful research you learn that at least 25% fail and 50% have had to spend millions in redevelopment to get a product to market, and many don't make money for years or not at all. That places many retailers into a corner when searching for technology that can provide them with the capabilities to digitally transform their businesses. Making the right technology decisions is not easy and it can be an expensive mistake in acting too quickly or too late. Read more Start ups come with risks and larger established tech providers may be the wrong fit and come with bigger costs. However let's be clear, you cannot compete in this environment without a plan that in the long run leads to digital mastery.

Malls need a customer experience meter

Many who have spent a couple of decades in retail, have visited malls where their retail chains operated or to check out new location opportunities, it has all been very routine. A great deal of traffic. Tenant turnover was normal and usually replaced with a more attractive operator. Malls used to be a destination where there was aspiration for the future and getting inspired. Today much of that has de-evolved, most malls are no more than a hangout, indoor walkabout, and shelter from the external environment. The compliment of retail operators, aside from the big-name brands such as Lululemon and Zara for example, there is nothing really that captures the eye and creates the desire to visit these locations more frequently.

For years many have advocated that mall’s need to be reinvented. Creating each with a new proposition other than the same old repetition of retail brands would be a novel idea, alas it isn't in the cards. So, are malls dead? No! They are in dire need of re-investment, and I believe this is where developers are putting on the hazard lights, because there is uncertainty about how long all malls remain relevant in the shopping equation. The challenge ahead is to improve the mall and merchant experience with technology to educate, entertain and engage shoppers. A much fresher retail appeal is also needed from retailers on store fronts and complete with a higher level of service. Consumers want more of an experience. If one mall for example was about technology and innovative new products, consumers would drive to experience that. The same goes with home furnishings only or fashion only, even a mall for resell would be a fresher look. Things are getting tired and as we navigate through a post pandemic world and eventually the economy rebounds out of inflation there is a need to address this challenge. No, the mall is not dead, but if developers don't get creative they will get close to it. If someone can develop a mall customer experience meter, mall operators should start using it now! Read more here

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