There are a lot of people who reckon bricks and mortar retailing is dead. It isn’t. What is dead – or deserves to be dead – is the traditional attitude to retailing.
The old model was based on inventory. The more products you could stock, the more you could sell.
In this model, small specialist stores found themselves losing customers to larger general stores. People shopped at the big general stores because there was more to choose from.
However, in the 20th century, these large general stores found themselves losing customers to massive department stores and supermarkets. The department stores and supermarkets offered one-stop shopping for everything from furniture to cleaning products to food. Customers chose convenience over quality.
In the 21st century, these massive department stores are finding they’re losing customers to online stores. In fact, retailers of all sizes are suffering the same fate. Well, most are. But not all. More on this in a moment.
So how do you fight the trend to online shopping? How do you compete with stores that don’t have your main street rent, your sales staff salaries, your shop fit-out?
You do what an Illinois hamburger restaurant did. You stop selling your core product.
This hamburger joint had a neon sign out front. It read, “Over a million hamburgers served”. Business was booming. So what did the company do? It shifted its marketing communications away from its product, its hamburger, and focused instead on the experience it offered customers.
The store ceased to be in the hamburger business. It was now in the business of providing a reliable, repeatable family meal experience.
The name of that hamburger joint, if you haven’t guessed, is McDonalds. By shifting focus from its product to the experience enjoyed whilst eating that product, McDonalds opened the door to global expansion. Today you can enter a McDonalds store anywhere in the world and the experience (and food) will be essentially the same.
McDonalds isn’t the only successful business founded on experience. Starbucks turned a commodity, a coffee, into an experience. It introduced dozens of flavour options and size options. It did a lot of research on interior design. It added music download stations, and seasonal playlists. It made smiling part of the job description.
So how do bricks and mortar retailers compete with online retailers? One way is to shift the focus from products to experiences.
Bunnings is successful as a store because they ensure that every staff member knows where every widget is located, because they run regular DIY classes, because there’s always a sausage sizzle out front and a play area for kids.
There are plenty of examples of small retailers who are creating unique experiences for customers – in every category. A boutique clothing retailer turns her store over to poetry readings. Another women’s wear retailer boosts sales by making room for a couple of comfortable armchairs and magazines (so guys have something to do whilst partners try on clothes).
A Milan butcher packs meat in distinctive branded paper bags, rather than generic plastic shopping bags. And in Sydney, a meat wholesaler has created a butchery where meat is the star of a floorshow in a space reminiscent of Aladdin’s cave.
Other retailers find niches in competitive sectors. Stores compete with Toys R Us by focusing on traditional wooden and tin toys. The nostalgic experience they offer is something the mass-market warehouses can’t copy.
In New York, one store completely changes interior design and product range every six weeks.
To sell more products, stop selling products and start selling your unique experience.