March 17, 2009

Quick & Dirty: Retail Therapy

So, this weekend I was out and about enjoying some much needed retail therapy and doing my part to improve the economy....okay, maybe not so much because I'm a thrifty bastard who will avoid paying full price like the plague (although at this point I would pay top dollar to find a shoe store in Charleston that sells a pair of K-Swiss Classic Tennis shoes). But, this is okay because, as I eventually surmised, the economy is doing just fine.

At least, that's the opinion I formed from shopping at stores that are either supremely confident that U.S. consumers are going to spend massive amounts of money on their mostly non-essential luxury items or clearly didn't feel the need to (re-)develop better business plans.

Off the top of my head, I'm not sure at what point a Knowledge Manager might be engaged to improve a businesses economic outlook, but this Knowledge Manager has a few ideas on how retailers might make some gains (or, at least, shake me down for a few more coins):

  1. Check your prices. Established businesses are working the sales like crazy (partly to move inventory, but also to minimize losses and maintain a steady flow of customers). However, new businesses opening in this economy (particularly small businesses) should re-think high price points if they are going to stay afloat in a difficult economy selling items that you can find at your competitor across the road. If high prices are necessary to break-even in your first few months, either consider pushing back the Grand Opening or finding less expensive retail space to reduce overhead. Or, you could just ignore this advice and crash and burn in month two - I bet I'll be able to get everything I wanted for a song. Everything? E-v-e-r-ything!

  2. Re-invest in sales.Personally, I don't credit JT with bringin' sexy back, but I'd sure like to know who the hell you've gotta call to bring salesmanship back.Just like big manufacturers discovered the missing value of in-house call centers in the '90s, it's high time that retailers rediscovered the lost art of sales. Not just pimpin' out some cheap hired help to ring up a purchase, but utilizing your salesforce to both move product and get the kind of one-on-one feedback that most non-retail businesses would kill to have in order to understand what customers are looking for. There's KM for ya! Knowing what your customers want and are willing to pay for, directly from their own mouth, will help businesses to stock moveable merchandise and build that oh-so-critical customer loyalty

  3. Revolutionize the mall.If there's one thing I think major retail outlets could do to single-handedly improve the U.S. economy it would be to revolutionize the shopping mall. These days shopping malls are the retail equivalent of the cookie cutter suburban housing development - uniformly pretty, convenient, bland as all-get-out. Because of the high cost of retail space in most successful malls, the barrier to entry is ridiculous leaving consumers with a directory of stores no different from any other mall. And, when businesses fail and must vacate, the effect on the mall is similar to that of a residential neighborhood - an unattractive, depressed, financially devalued community on the road towards mall death.

    Imagine if, from the onset, malls set aside a slect amount of space specifically priced and marketed towards small, locally owned businesses, perhaps connecting with area university business and/or fashion programs and helping to establish budding entrepreneurs and designers; anchored stores could even be asked to help subsidize this program (particiulalry since their investment is the largest). In this way, each mall is differentiating themselves, attracting a more consistent flow of consumers, and more firmly investing in the local economy.


Mario said...

Happy Sixth, I'm going on four myself in a couple of month.

Here's what I don't get about small businesses:
If you're a mom & pop place why oh why do you think that you can compete with big box? The successful small businesses understand a segment intimately and cater to that segment until later success shows itself.
I agree that salesmanship is slipping. Not only in stores, but also in the restaurants, the banks (I think that some tellers could learn from ATMs), and even at the gas stations (would it kill gas stations to hire people who know how to get around in the neighborhood? Really?). Given the tough economic times, I would say customer service is a key differentiator and the easiest for a business to use.
I'm just sayin' izall.
Malls and shopping centers need to be revitalized to be more pedestrian-friendly, as well as become a place to be, not just a place to go.

Christian Young said...

Hahahaha, "I think that some tellers could learn from ATMs", you're crackin' me up, Mario!!

You're dead-on about the criticality of customer service. Curiously, while it's one of the most sure-fire ways of setting yourself apart from the competition and the least expensive aspect of a business to develop (particularly for smaller, owner-managed businesses), lately it seems to be the most underutilized investment strategy.