This is the “Age of Information” in retail, and shoppers are smarter, have more choices and are more price savvy. The new paradigm in retail directly impacts businesses now more than ever as the consumers’ expectations have changed, mostly due to technology. Smart phones and personal tablet devices empower casual and experienced shoppers alike with real-time information on every product ever sold. Consumers have immediate access to prices, product specifications, and alternative stores. Consumers have much higher expectations than ever before and want immediate results from cheaper and closer options (if they leave the house at all). This is the crux of the paradigm shift in retailing.
Retailers must take action
Retailers must be proactive and responsive to this change or succumb to price gouging from the big box stores. In order to compete more effectively, it is imperative that retailers understand the trends in today’s market and focus on meeting the consumer based on the shopper’s expectations, not the expectations of the retailer. The retailer should be better prepared to connect with the customer on a more personal and emotional level. This can partially be achieved by implementing a customer loyalty program. Retailers must also provide advanced customer services, like tracking consumer purchases to offer easy “no-receipt” returns, historical purchase lookups and targeted discount campaigns.
Improved customer relations can be accomplished by training employees to do something as simple as smile and say things like “Thank you” and “We appreciate your business” more often. Training employees on proper customer care and retail etiquette is required. With checkout clerks at the front lines of every retail operation, they must understand the importance of their role in customer retention.
The goal of retail
The goal of retail is to attract customers by providing the products and services they want to buy; then up-sell them other products and services they didn’t know they needed. Selling is the only way to sustain and grow any retail business. But how you get there is greatly dependent on how well you treat your customers and meet their needs. It’s important for the retailer to have both depth and breadth of products and services to appeal to consumer needs and wants.
Focusing energy on add-on services can take the focus off inventory and price management and put it back on what retail is all about: sales. Enhance the customer shopping experience by providing benefits like fast checkout, excellent customer service and clean, well-lit, organized and properly labeled shelves. Offer convenience and savings like historical lookups (to allow for returns or reorders without a receipt), custom promotions and preferential treatment for your best customers.
Remember the 80/20 Rule: 20% of your customers drive 80% percent of your revenue.
The e-commerce retail swing
Embrace the internet. Leverage existing e-stores like eBay or Amazon with your custom branding to expand your customer reach and allow you to sell to customers whether they’re in line at your store or on-line at home. E-Commerce allows you to compete more effectively by offering additional buying options to your customers without a significant capital investment.
The bottom line
The world of retail has changed, and store owners simply can’t compete without committing to embrace new technology and focus on outstanding customer service. Part 2 of this series will focus on those two concepts.
Charles Owen is a Business Alliance Executive with Paladin Data Corp. Drawing from his 30 years of experience in retail sales, food services, real estate and software development, he recently shared this presentation on the paradigm shift in retailing and how store owners can take advantage of it to improve their retail operations, profits and customer loyalty. A link to the full presentation is available on our website at http://info.paladinpos.com/Orgill_SeminarFeb2014.pdf.
To view a Q and A session about this topic, click here.