What is “retail?”
As a term it defines an industry. As a channel, it represents sales directly to consumers. From a physical standpoint, it refers to the place where brand to consumer sales transactions takes place (physical and/or virtual footprint). From a consumer standpoint, at its most basic level it is about sales and purchase. And if executed properly, it can provide a consumer experience that is enriching, satisfying and enduring. However, for large-scale mass retailers especially in the U.S., the decline of consumer satisfaction with the in-store experience cannot be remedied with just more of the same tactics. Big-box, brick and mortar-based retailers must redefine the role of the physical store within the life of a consumer beyond just the “buy.”
According to John Ross former Home Depot CMO, “The Role the store is playing is changing…shoppers are waking up with a different set of expectations.”
In the U.S., big-box retailers are falling short of meeting consumer expectations at retail. Technology has empowered the rise of e-commerce and m-commerce thereby leveling the in-store advantage of “best price” claims. And given the rise of social commerce in 2010, consumers not only expect to be empowered shoppers, but socially connected to an experience that is even bigger than any big box store. And although service would be a value-add and obvious point of distinction, we still find that most retailers are being overshadowed by service excellence by the online retailers. Interesting to note that at this year’s NRF (National Retail Federation’s Big Show) in NYC, nine out of the top ten retailers nominated by 9200 consumers for “Customer Service Excellence Award” were retailers who were either exclusively online or generated a vote because of their online service. The winner for Customer Service Excellence in retail was given not surprisingly to Zappos – a brand that embodies excellence in service because of the shared higher purpose instilled within their corporate culture.
In the U.S. “Social” is one of those buzzwords that is being embraced by many retailers today, but most do so purely on a communication and tactical level. Big box retailers especially are using twitter, facebook and foursquare primarily to drive in-store traffic and purchase volume through promotions and price. But this fleeting form of social engagement is really not about building communities – it remains focused on moving volumes of people and product in store. The mindset of product and promotions has not changed despite the new forms of communication, community interests and the evolved social values of consumers.
“People don’t go into stores just to buy, they go for the emotional experience of it” – Marc Gobé
Contrary to what you may be thinking, this post is not meant to be about the future of bricks vs. clicks (I’ll leave that debate to the analysts) or a judgement against big box retailing (that would be hypocritical since I’ve worked with several big box retail brands). But simply a reminder that retail should not only be about consumption of a product and buy, buy, buy – sell, sell, sell mindset. “Retail” that is devoid of emotion and a satisfying consumer experience is at best “commerce.” I do believe that when retailers loose sight of this distinction – that is when consumers will be driven to shop based on price versus preference.
Just think about some of the retailers that you frequent. Chances are you hold a special place in your heart for those where the sales assistants were truly helpful. Or where the environment was comfortable and inviting. And maybe you associate a certain retailer with a “never forget” enriching or delightful feeling. All of which speak to an enduring emotional experience that stays and connects you with that preferred retailer.
So what if such a connection with a retailer was extended beyond the four walls of the store? How could retailers play a more active role in the lives of a community? How can big boxes connect on a human scale – and do so authentically?
A retailer’s social sense of purpose and responsibility to a local community should go far beyond a branded cause or local philanthropic sponsorship program. This involves a different philosophy and mindset all together regarding the role and purpose of retail within a community. It is a given that retail is essential to a community’s economic and social wellbeing. But too often we see retail impose itself into the landscape and compromise the quality of life for the very people they are supposed to serve.
How can large-scale retailers grow without weakening the integrity and strength of a community? How can they assume a presence within a community without compromising its humanity? Is this balance even possible?
I’m glad to say “yes” indeed it is!
In the U.S. you see glimpses of this i.e. Barnes & Noble with their visiting author and book reading series. You see such an open community approach happening within the Apple store with their group tutorials and Tech Camp sessions for kids. This community building approach to retail may not be all that prevalent throughout the U.S (yet). However it is at the core of successful retail models that are thriving overseas – not in developed markets – but by large-scale retailers in emergent markets.
Last week I attended the NRF, National Retail Federation’s Annual Big Show in New York City. Of all the seminars that I attended, I was most impressed by one in particular, “Retail in Emergent Markets.” This talk was given by Gwen Dixon Morrison (The Store/WPP), Suzanne Ackerman-Berman (Pick n Pay -South Africa) and David Marcotte (Kantar Retail).
I was especially moved by Suzanne’s talk which was so inspiring and hopeful.
Here’s an excerpt:
“Retailing with a difference. Retailing with a conscience. Retailing is not about maximizing profits. Nor is it about seeing a fantastic opportunity and saying “hey we can make big bucks there. That is not retailing.
Retailing in the emergent world is about growing the communities, engaging with society and trying to maximize the potential of the entire community. We need to use retail as the opportunity to test and grow local resources… The developed markets have not caught onto this concept yet….We (emergent markets) need to teach the rest of the world how to do retailing with a difference”
– Suzanne Ackerman-Berman/ Pick N Pay – Corporate Transformation Director
A community should feel enriched and strengthened by retail – not left to feeling depleted. A consumer should feel like an empowered and valued individual, not just another sale.
Here are some examples shared during the NRF seminar on how retail can make a lasting difference for a community.
• Skills & strengthened smarts –Provide not only training for the job, but offer supplemental education for all employees. Make such self-improvement accessible during work breaks so as to minimize time away from their daily family life
• Start-up help – provide ownership opportunities to employees in the form of a franchise. As with Pick And Pay, provide guidance to an entrepreneur when securing investment backing and donate management experience when setting up the foundation for the franchise
• Celebrate & empower local – Instead of competing with the local outdoor market vendors – Minka in Lima, Peru brought the open-air market vendors indoors. They empowered vendors with their own booth signage, safety and security of their goods and even provided free business training to help them become more successful i.e. classes on merchandising.
• Enable a dream– A retailer grocery chain in Brazil responded empathetically to the needs of brides and their desire to feel special on their wedding day. In many underdeveloped markets, a bride cannot afford to doll herself up. This concept was designed to give them an affordable way to experience a bridal royal treatment.
• Share in the pain– a retailer in Turkey made a public promise to “freeze prices” for three months in response to the consistent climb of hyper-inflation. This was a rare breath of relief and a retailer’s gesture of empathy for a community that was being squeezed financially and emotionally.
Enabling technologies, varied modes of commerce and global access of goods can be looked upon by a retailer as either a blessing or a curse. The “deniers” will fight the changing tide and will remain on the defensive with little to compete upon other than price margins, promotions and product.
It is the retailers who embrace new technology, new forms of commerce and new ways of engaging people within their community who will benefit the most from this new era of retailing with “purpose”.
Emergent market retailers have shown that size and scale of a retailer does not define its success – but at the same time, nor should it define its limits. It is in every retailer’s best interest to see a community thrive emotionally. Because it is in doing so that they too will be successful.
We recognize that although this post is a general commentary on large-scale retailers, there are individual efforts by big box and local retailers that exemplify this concept of “retailing with purpose.” To honor their efforts, please take a moment to share with us mention of who they are and how they have contributed to their community’s wellbeing. Thank you!
This post was originally published on the SocialVoice website.
Anneliza Humlen is the President and Founder of SocialVoice®. She is a brand strategist, development leader, culture-change catalyst and writer. She has dedicated over 15 yrs to helping businesses create meaningful brands through humanizing communication, culture-building and mentorship development of brand ambassadors.