Comparing apples to apples
More competition is not a good thing
The first 120 days of the year have brought some big changes to the retail landscape. Between Sears, K-Mart and Macy’s, over 215 stores are being shuttered.
Ask a retailer as to why this has happened along with the closing of Sports Authority and others, they along with Time magazine, and other experts will tell you this is because of Amazon.
Add to this the number of customers who are “showrooming” and apps such as BuyVia and ShopSavvy, to get a picture that can look pretty dismal.
With Amazon, and other Internet retailers, apparently being the answer to what is, or will, be the demise of almost every brick and mortar retailer, what is everyone operating a business supposed to do?
Just as this competition changed the retail equation by taking out a lot of the components/expenses of retailing to get to our customers, we have an opportunity to change the retail equation again by adding new components to the equation.
Why do these apps and showrooming work in our stores? Because we are allowing customers to compare “apples to apples”. It is easy to know the make and model of most everything you sell. Use that appropriate app on their phone and the customer knows where they can buy that identical product for less.
There are three differences in your store and that online store. The first is they can buy it now from you. The second is that the online store may charge for shipping. And if your sales staff has helped the customer select the right item for them, you have lost that third advantage as the customer has used you solely as a place of knowledge and the opportunity to touch the product.
What if our apples were different? Let’s get out of the fruit department and into your store.
Think about almost any product that you sell? How many of them are standalone items; those that have no relationship to any other?
Every firearm needs shells and a carrying case. Every bow needs arrows and to be restrung. Every rod needs a reel and the reel needs line. Along with that, you have to have lures, a tackle box and an unknown quantity of accessories. And, all of these sporting activities require the appropriate clothing. Along with that, how many of these items have a need to be serviced or adjusted? How many of these could you create a school about so as to teach your customers how to use and enjoy them better?
Therein, lies our different apple. The opportunity for a different apple comes for several reasons. Most people cannot do math quickly in their head; the price and the quality of service is an unknown amount; people like things that make their life easier.
Let’s take a reel as our example “apple”. The customer knows how long it will take the online store to ship the item and what the shipping charges are, but your reel comes with your loading the reel with the line of the customer’s choice. Your reel comes with the offer of your helping the customer as they bring in the rod and you confirm it is a good match.
Perhaps your reel comes with the offer to change the line once for your customer. You could also add a free servicing of the reel in the coming year.
You could top off this offer by creating a school for your customers. A manufacturer’s sales rep could make an appearance in your store one evening, along with cola and pizza for your customers. Our experience was that any sales rep visiting the store was always received as a top notch expert because they represented the manufacturer and were from out of town.
Now let’s take a look at the comparison. This reel is $399.99 at the online store. The charge for shipping depends on how fast the customer wants the item and could be as much as $35. If the customer decides they don’t like the item, returns are allowed which the customer pays for return shipping.
How much more than the $399.99 can you charge for the same reel? That answer varies from store to store, but having added some line, service and school means there is a big difference. All three have little to no cost but perceived higher value. Your “apple” is different. And your “apple” includes items that the customer is going to want or need as some point. It sure makes it a lot less stressful doing business with your store.
The moral of the story is simple, “When the bear gets into the water with the alligator, the alligator usually wins”.