7 Lessons on Second Chances
You are not living in a world that wants to give second chances. At best, you will find them scarcely in life, rarely in business, and seldom in retail. Having said that, have you heard that Toys-R-Us may be coming back to retail? Let’s choose to believe that this plan comes to fruition. Let’s also believe that you are aware of this former powerhouse retailer. I certainly am. I have been following the saga of the retail economy in America for decades, and I passionately believe in a brighter future for retailers who understand their roles and responsibilities in today’s landscape and have a passion for succeeding.
There are several examples of retailers that found a second life online (Service Merchandise – Bankruptcy-1999, but closed in 2002; Filene’s Basement – Bankruptcy-2011; American Apparel – Bankruptcy-2017; Sharper Image –Bankruptcy-2018; Linens ‘n Things – Bankruptcy-2008). Moreover, there is Circuit City, where I happen to have a great deal of personal experience. They filed for bankruptcy in 2008, with a planned revival of their online business, but their physical presence is expected to be a store-within-a-store business model.
Ironically, the only other relevant example of a real second chance at retail is another toy retailer, FAO Schwarz. They closed their doors in 2015 and resurfaced November 2018 at a new location in Manhattan, and at a smaller outpost in LaGuardia airport. Regarding Toys-R-Us, their weaknesses were their fundamentals. Bankrupt in 2017, they closed the last of their locations in 2018. Though many were sad, few were surprised. However, now with a stated intent to return to retail for the 2019 holiday shopping season, we have a fantastic opportunity to learn, in real-time, if the former retail giant has mastered the 7 lessons on second chances.
- Know Your Customer. Play to Your Base. - Typically, it would be enough to know your customer base. However, retailers like gift stores and toy stores often neglect the distinction between the customer and their actual base. The customer is buying the gift. The base (fan base) is receiving the product and using it in their daily lives. The customer purchasing a gift at a Sharper Image store may not be a fan of the brand’s products for themselves – but they still want an exceptional retail experience. That customer must go to the Sharper Image retail location to satisfy the devotee, who will accept no substitutes. When referring to Toys-R-Us, adults are making the purchases, but children are the fan base. Maximizing a child’s devotion to one store, the store, is the mission. You need to build a customer-centric relationship with and for every individual in your target market within a five-to-eight-mile radius of your physical stores. How is this accomplished? By incentivizing not only the customer but the base as well. As an example, if Toys-R-Us were to issue a child a “Geoffrey card” (an expensive, beautiful and highly valued card) as a way to connect children to a unique manufacturer-Toys-R-Us rewards program, it would spark interest with the base. Meaning, every time the child walks into your physical store, they gain X amount of Geoffrey points. If they “convince” their parent or guardian to purchase anything during the visit, they gain more points on their Geoffrey cards. Then, when a child downloads, let’s say, a Mattel Barbie Doll app to their mobile device, they earn even more points. Not expensive to administer with brand manufacturer direct support. You have the potential to build this customer-centric relationship through tailored incentives and programs customized to capture attention from your base.
- Include Your Fan Base’s Centers of Influence. – Any child-centric retailer must identify, focus, and core down on their audience with every local school from grammar school to high school. These retailers are responsible for building an unshakeable, unyieldingly happy and prosperous relationship with each faculty member. Imagine having every school teacher registered with their local toy store for in-school programs, including toy fairs, school donations, and special events. The local impact that would result would be so significant that communities across the nation would be inspired to build a similar program. Community relevancy and relationships are the original keys to any physical retail stores. It is critical for retailers like Toy-R-Us to take part in local initiatives through sponsoring sports uniforms for public schools in their local 8-mile trading communities. The stronger the relevant physical relationship is for a retailer in its community, the stronger the corresponding buying relationship will also be.
- Create an Exceptional Retail Experience for both the Customer and Your Base. – An excellent retail experience is not established overnight. It requires hard work and diligence to accomplish. When you boost your brand’s short- and long-term value through an exceptional in-store experience, competitive dominance, and market demand, you boost overall earnings. As I like to say repeatedly, “a brand is a promise.” Your brand currency needs to be shined, primped, pruned, and protracted every day competitively. I urge you to require your in-store employees to smile, to be happy, to over-service and support for competitive advantage, because every employee across all departments, products, services, and customer support represents and fuels your brand muscle in the market. Please create a smiling, happy, energizing, joyful and exciting in-store and online atmosphere as your smartest boomerang for traffic. If you treat your customers with excellence in support and care, your team and company shall be rewarded with more business and higher profitability. Your brand mantle, your brand promise, your employee promise must be the same: cheerful, friendly, exciting, joyful and dynamic. Happiness and smiles are highly relevant in the language of competitive advantage. These in-store attributes and emotional capital will drive fiduciary capital your way, prevent store closures, and create a higher demand for new stores from other communities.
- Give a Big Heart to Your Retail’s Brand Identity. – Creating a strong brand identity in the marketplace is no simple task. You must strategize and explore what appeals best to your customers and your base to succeed. A corporation’s precise strategic direction should be viewed as the most critical reservoir of shared knowledge and the most important leadership mettle for all employees. I implore retailers like Toys-R-us to bring a friendlier voice and demeanor to their identity; to the point when children, teachers, parents – even the competition – sees, hears, and dreams Geoffrey. Make your brand identity highly desired, loved, and the foundation for your competition to follow.
- Create Business Collateral for Both the Customer and Your Base. – You must seek to inspire others, enable others, model others, energize the hearts of others, and encourage others through customer engagement and excitement. Customer engagement can be elevated through employee engagement; at each cash register after a transaction, require each associate to say, “Thank you for shopping with us and please come back to see us again real soon.” This action could be followed by an incentive, which could be sponsored and paid for by various manufacturers, or a coupon to encourage the customer to visit again for a discount – simply relevant relationship-building paid for by manufacturer brands. Limited-edition giveaways are an excellent sales and marketing strategy to launch a new line of products and engage your base.
- Be a Part of Your Community. – I encourage you to stop thinking of relationships as business-to-consumer. With physical stores in local communities, please think of every avenue of business; let it be business-to-consumer, business-to-business, and business-to-the-individual. Make it a requirement that store managers take the initiative to visit centers of influence in the local community personally. You must determine your consumer and corporation targets: alter your thought process, your focus, and your celerity (speed) to increase local store sales year over ear, month over month... day over day. You must build relevant relationships in local communities and people will reward you by more regularly visiting your store, by showing loyalty to the products you sell and by providing an unfair share of the physical store and e-commerce sales to you. Create a B2ME direct program for various community clubs and organizations as a handshake to your local community.
- Give Back to Your Community. – In business, it is okay to have a heart for the innocent, a heart for your team members; for your brand, your products, and especially for your customers. You cannot forget to give back to your local community-centric charities and fundraisers. The more you give, the more you show up and participate, the more you will receive from the local community. It is true, for any retailer, “it is better to give than to receive… and when you do give, trust me, you will get back.” Having a giving and caring spirit of generosity through your store, and instilling a sense of self-sacrifice in your employees while uniting around a cause of market acceleration designed to make or take a market is, in itself, the spirit of team generosity focused on a united purpose.
Finally, never compare your business to pure-play e-commerce retailers, searching for a sliver of advice relevant to your physical stores. They have all profitably prospered from the lack of retailers’ local in-market focus, lack of in-physical-store associates’ happiness or excitement to serve, to help to support consumers. Online-only retailers do not need to concern themselves with associates’ smiling face-to-face consumer care.
Consumers have been trained to cherish their cloud experiences over physical store engagements because of the widespread popularity of mobile apps, simple accessibility through their Internet browser, and minimal human interaction service or support. The consumer journey starts and ends with a robot-smile and a big “thank you for your order” and “thank you for your returned order.” These e-commerce giants acknowledge who their consumer is and show gratitude for their purchase. Imagine if a physical store like Toys-R-Us did all we suggest here for decades in localization within a five-to-eight-mile radius of each store, how prosperous they would be. How easily a retailer could fend off both e-commerce and retail competitors. How happy the local community who grew up with these stores would be to bring their family in to visit for generations.
There are many paths to business success and there is no one righteous or solitary business path. However, uniting a caring and sharing vision causes and ensures positive dents, positive, lasting value for all business stakeholders, all customers in the language of opportunity. Local market relevancy and relationships with joyful hearts, energy, and excitement are what “we the consumers” hope will be during the return of retail giants like Toys-R-Us. Of course, all physical and omni-cloud retailers need to get some of the Toys-R-Us future mojo constructs. Remember, Geoffrey and Toys-R-Us, provide a more personal in-store experience, and we the people in an ambient union will return the favor.