Specialty Retailers Strive to Survive
Nothing more really needs to be said about how volatile the retail market has been of late. Of course, being in the middle of the holiday shopping season, things are a bit more cheery for retailers of all shapes and sizes. But don’t let the current level of foot traffic in your store fool you. Retailers today—especially smaller and specialty stores—are fighting for every foot that walks through their doors. But the number of shoppers that walk into your store doesn’t define success. Rather, it’s how many walk out with a few less dollars in their pocket.
Competition for retail today isn’t just the giant big box store that’s across the street. It also includes the thousands of websites that can discount product and ship to consumers’ homes. It’s also brands themselves, which are opening their own stores as a way to capture a greater percentage of each sale by going direct to the consumer.
So what can specialty stores do to survive in this type of market? Astound Commerce, a retail market research firm, set out to find some answers. Their recent report, “Specialty Stores Invest to Survive,” explores where specialty retailers are putting their dollars—from tech investments to in-store experiences—in an effort to increase foot traffic.
Dealerscope sat down with Astound Senior Vice President of Digital Strategy and Chief Merchant Lauren Freedman to go through some of the key findings and to talk specialty retail shop.
Dealerscope: What was the most surprising finding to come out of your research?
Freedman: One of the most surprising things that we found was that the sophistication of the onsite service was much lower than expected. From the onsite help destination to the queries we conducted, results should have been stronger. The phone number should be visible on the home page, customer service hours universally shared and all FAQs searchable (now 26 percent of the 78 percent sites that had FAQs).
One final thing to note is that only 14 percent of the 50 specialty retailers offered free shipping. Most consumers expect expedited logistics capabilities, and many specialty retailers simply didn’t offer these features.
What are the biggest challenges that specialty retailers face from a digital standpoint?
For specialty retailers, we noticed that many have challenges when it comes to keeping up with the investments being made by larger retailers, mass merchants, and marketplaces while still maintaining the integrity of a specialty store brand. We also noticed that many were challenged when trying to integrate the range of merchandising consumers desire, along with problems visualizing their product assortment.
Given typical bandwidth issues specialty stores face, websites/social/ecomm strategies may not be top of mind all the time. Any tips for how specialty stores can simplify the process?
One of the first things specialty retailers need to focus on is knowing what resonates with their audience. This will help ensure that foundational elements are in place first (onsite search, cart efficiencies, customer service). These retailers must also make sure that they effectively employ merchandising by providing inspiring and engaging experiences. Additional recommendations from the report are included below.
What does the ideal specialty retailer's mobile app look like?
The first step is simply having an app. We found that 74 percent of the specialty retailers we looked at had mobile apps. Once that foundation has been established, there are several key features that specialty retailers must focus on.
An ideal app is efficient, with navigation that’s quick to the product and easy to follow. Product pages must also be robust, with easy to scan product imagery and copy. Mobile apps must also have a focus on speed and efficiency, as consumers have smaller screens to work with on mobile and shorter attention spans than ever. Integrating loyalty programs and special wards is also a must to help streamline the shopping experience.
Outside of specific shopping features in mobile apps, specialty retailers must also make sure that mobile apps make locating the nearest store just one click away to facilitate an omnichannel environment.
For those retailers without an app, what homework should they do before deciding to develop one?
Before a retailer builds a mobile app, they must first define its role and ensure that it will be a part of their omnichannel strategy. Here’s a quick checklist of other features to explore before building an app:
- Understand the frequency of purchase for the brand - are orders made frequently enough to justify an investment?
- How much content should you incorporate given the “mobile” nature?
- Evaluate best practices particularly in their category - does your competition also have mobile apps, and are they well built out?
- What tools and functionality are right for your brand?
What are some of the more unique use cases of in-store tech that you've come across? (Or what kinds of in-store tech do you think are most effective?)
We’ve seen some unique and innovative uses of technology in store. I’d like to highlight the kiosks that scan in-store pickups at Dick’s Sporting Goods, the Container Store’s Alexa-like device to check inventory across the stores, point-of-purchase for fitness devices at Under Armour, and the focus on educational and interactive experiences at Sephora.
Anything else stand out from your research that we might’ve missed?
Niche product categories matter, and the category(s) you sell have an important role to play.
Also, keep in mind that today’s shoppers demand everything, and they demand everything now. This has to be a crucial part of every specialty retailer’s strategy, as it’s not going away.