Retail Disruption Creates Consumer Consumption
Leverage change to generate customer loyalty and profitFebruary 20, 2013 By Peter Weedfald
Accelerating consumer traffic while simultaneously changing your business model to create consumer value is the core focus of smart retailers. Retail leadership demands highly disruptive marketing plans that will regain efficiencies, drive in-store and online traffic, and generate profitable opportunities.
If you don’t have an “SVP of Retail Disruption” on staff that is focused on capturing creative opportunities and catalyzing needed change, I suggest you promote or hire one immediately. Retail leadership should invest to arrest the competition through disruptive business models. The net? The right retail disruption model married the right brand and product value model will deliver the recurring consumer traffic to ensure profitable engagements.
The changing ways in which consumers buy goods today is a prime catalyst of retail disruption. New software, hardware and Internet technologies are delivering countless ecommerce opportunities, offerings and strategies through every consumer and business device. Cloud-enabled devices and a never-ending stream of apps disrupt the market AND generate opportunity. All this disruption and cloud consumption causes P&L tensions throughout traditional retail environments, creating dangerous catalysts for retailers and manufacturers on a global scale. With this kinetic disruption, cautious change is no longer an option.
Here are five of Gen One Ventures retail principles that will help you turn disruption into profitable opportunities:
1. Club Your Competition: Change the game; solve the problem. Establish a club-card model to attract new customers, reward existing customers and lure business away from your competitors. Clubs continue to deliver positive sales and store comps while offering limited product assortments accented by low pricing and the joy of discovery for consumers. As we know, consumers happily pay for these highly profitable retail cards.
2. You’re Big, Now Tell Someone: It’s puzzling that so few CE retailers take the time to market the full breadth of their product and service offerings. Consumers are constantly searching the Internet for products they wish they could touch and experience, even though they can do just that at a retailer just a short distance from where they’re actually conducting their search. Retailers offer variety, services, demonstrations,advice and aggressive pricing, to name a few benefits. Consumers are hungry for that. Promote all that you have to offer.
3. Turn Web Squatters Into Store Squatters: There are plenty of e-retailers who do not have physical stores. That’s great news retailers that do. Yet so many consumers continue to buy from the web as opposed to buying from retail stores right around the corner. Yes, we know that no tax and free shipping is tough to compete with. But retailers with brick-and-click engines need to create smarter offerings to usurp the online competition. You have so many advantages; it’s time to get disruptive and promote them. Connect your cloud to your store.
4. Smart Service Makes The Difference: TV sizes are growing while prices are plummeting. This is great news for brick-and-mortar retailers because most shoppers don’t want to strap a 60-plus-inch TV on their car roof. Nor will they want to risk a 60-inch TV being shipped across country from an e-tailer. Retailers need to do a better job selling and marketing the value of their local in-home services, especially when it comes to optimizing the installation and picture quality of a new smart TV and integrating the set with all of the family’s connected/mobile devices.
5. Re-tail, Re-Constitute: In another highly commoditized business, free shipping is standard. That business is called the pizza business where the shipping is free and we kindly tip the deliverer. In some cases, it might make sense for CE retailers to offer free shipping to consumers who live a certain distance from your store: “If you order on our web site by 1:00 p.m. we guarantee free same-day shipping by 7:00 p.m.” But make sure to charge for installation services … and watch your profits roar.
Successful disruption is cultivated through careful research of what consumers really need, want and value. Profitable disruption motivates consumers to reward your sales channels. Start today by establishing an SVP of Retail Disruption role to create, lead, motivate and promote your own principles for retail profitability. Create what consumers demand and they will give you what you want: highly kinetic, competitive and profitable in-store and online sales platforms.
Peter Weedfald is president of Gen One Ventures and author of Green Reign Leadership