All this hype surrounding the upcoming London Olympics had me thinking about the ‘fitness’ of retailers today. To use the analogy of a prime Olympic athlete: when retailers first begin their journey, they are typically sharp, lean, focused, agile, fast and very fit.
Then, as they mature, they can put on a few kilos, spread out a bit, possibly become a little lazier, find excuses to avoid getting fit, become easily distracted and generally slow down. It’s then that they realise some of their peers have actually remained fit, lean, sharp and fast and have overtaken them to the finish line.
It’s true to say that the race to win the customer’s heart and mind is actually more challenging than it was a year or so ago. Indeed, Myer’s Bernie Brookes recently spoke to the media citing current conditions as “the most difficult time I have encountered in nearly 36 years that I have been involved in retail”.
Today, we need to work on building more retail muscle than ever before and the trick is to understand where the lean muscle and the fat lies within your business model. Here are 10 key ‘fitness’ tips to think about when it comes to building your own retail muscle:
1. Focus on a specific and unique point of difference within the marketplace, as opposed to spreading your business too thin and being all things to all people.
2. Thoroughly understand your brand values and how to translate these so that they connect emotionally and subconsciously with the right consumers.
3. Present your brand in a completely consistent and aligned manner so that it inspires trust and builds loyalty and advocacy.
4. Understand the importance of omni-channel retailing and being ‘where the customers are’ in a relevant way.
5. Increase your customer service and satisfaction levels, ensuring you understand the exact point that too much service is uneconomical.
6. Grow profitable sales with a more engaged customer through a fantastic store experience and relevant and compelling loyalty programs. Indeed, our recent Consumer Retail Study reveals the physical store space is still the preferred method of purchasing a product or service.
7. Invest in understanding where your sales are made and to whom, as well as ensuring the buying, inventory forecasts, open-to-buys and ratios all reflect increased inventory productivity.
8. Recognise that cash rather than credit is king in these times and managing your cash flow is more important than ever.
9. Have a best practice ‘effective people’ framework.
10. Instil a culture of winning and performance that is relayed appropriately at every level of the business.
Really understanding the productivity and drivers of your business in more detail than ever before – together with increasing investment in the right areas (building retail muscle) and reducing less productive areas (trimming the fat) – are essential to the success of any retail business, particularly in these more challenging times.
Happy “Fit” Retailing,
Brian Walker is the managing director of Australasia’s leading retail consultancy, Retail Doctor Group.