The Future – Retailers With No Product

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The Future – Retailers With No Product

By John Stanley Stores without products how would they survive, but this is 2006 and anything goes. A few years ago I was approached by a global bank to do some consultancy; the brief was I was to design a bank that did not hold any money, a money less bank. Head office was convinced that by 2010 their banks would not be places where consumers would actually collect money. It is 2006 and I have just been to a paint shop where they do not have paint in store, plus as you would expect it is causing quite a stir in its market place. The store is owned by Plascon, South Africa�s leading paint manufacturer, it is located in Fourways on the outskirts of Johannesburg in South Africa in what is a retail design shopping mall. Firstly, this paint store is located next to a florist and home dcor shops and up market coffee shops. Its target market is purely and simply women, they don�t want painters to enter the shop. The shop is then decorated as fashion shop with drapes and large splashes of color around the interior. The sales team is attractively clad consultants and consumers are encouraged to sit at a consultancy desk and discuss their dcor desires for their rooms. Once a complete dcor decision has been made, the consultant then discusses the Plascon paint colors she feels would best suit the room. Once a color decision has been made, the paint is ordered and delivered to the consumers home or room decorator. All this with not a single tin of paint in view. This concept is a challenge to all retailers. Can you retail in your store without having the commodity product in stock in the store. It does highlight the changing face of retailing and that consumer expectations are changing the face of retailing around the globe. Let us look at the opportunities and why they are happening Less is more In previous articles I have discussed the fact that many consumers are now confused with the array of products on offer. Many stores are so cramped due to the amount of product that they stock, that the consumer is finding it a challenge. As a result the consumer either does not shop the shop or spends less time in the store as they feel it is too cramped to linger longer. They are looking for solutions not more variety and as a result the less is more theory is coming into more prominence. In my local paint store example they have decided to trade on their brand. If the customer trusts the brand then the less is more practice can become a reality in the marketplace. It is not about Product it is about ideas Consumers today are looking for ideas and solutions not product. When they want product they go to the mass market retailers, when they want ideas they go to the specialist. The specialist can therefore narrow their product range and offer the best advice possible. If you are offering the best advice possible and the customer believes in you, you can then reduce your product range. It�s a female shopper Traditionally the paint industry, like many other retail sectors was considered a male domain. Women were often intimidated by the traditional retail environment, but times have changed and the consumer is now intimidated by the traditional paint shop. The industry has moved into the fashion industry and now has to produce a female product. Today�s consumer does not want to see rows of tins of paint. As a result the retailer has an opportunity to reinvent the offer for the consumer. This is not unique to paint; it applies to many retail sectors and provides the retailer with a lot of new opportunities that were not there a few years ago. You cannot be a ‘Me Too’ Retailer Today�s consumer is looking for new and exciting opportunities and is prepared to search them out. The ‘me too’ operator down the road can now lose out to the retailer who provides a unique experience in the way they present themselves to the consumer. Daring to be different in today�s retail climate is a non negotiable. You have to take the risk to survive. If you don�t, your competitor will. It is a coffee culture even in a Paint Store I recently worked with a retailer where I suggested they put in a coffee dispenser. Her reaction was that she had resisted it for the last few years, but realized she had to get over it and put in a coffee offer. The consumer is now looking for more entertainment when they go shopping. The emergence of coffee shops around the world has shown that shopping is now firmly a source of entertainment and the shopper wants a refreshment as part of the offer. Service is more important than Product We live in a �do it for me� society. Consumers today want to have a decision in the process, but don�t necessarily want to do the job themselves. In our paint shop example, the majority of visitors to the store will not actually do the painting themselves, they will join the do it for me society and get someone else to do it for them. Therefore the product on the shelf is not relevant to their buying process. The same is becoming true in other retail sectors. Consumers are employing other trades people to do the work for them and therefore if they trust the retailer they don�t necessarily need to see the product. Trust retailing I have used the word trust a number of times in this article. Before you can take the product off the shelf, you have to be retailers who are growing trusted by their consumers. The retailers who growing their market share quicker than anyone else are the trusted retailers. This means you need team members that can relate to the consumer and who are trusted by the consumer. In the future retailers will need to invest more in their sales consultants to ensure they are experts in their field and are trusted by the consumer. Location, location, location Before you venture into this new world it is worth considering whether you are in the right location. Cluster retailing of the right stores is critical. With our paint shop example it was strategically placed next to a florist, coffee shop and interior design retailer to ensure that between them they could become a key destination in the consumers mind. Having the right location and retail cluster is critical to success. In Holland, for example, it is now quite common for retailers to cluster based on consumers needs. Furniture stores may now cluster together to attract customers and fashion stores the same. In Dubai the retail trend with new shopping malls has been to theme them based on cluster retailing. This trend will continue as more stores try to compete for wallet or purse share. Will we see more retail sectors moving into stores where the product disappears completely? Time will tell, I do believe we will see stores offering a simpler solution for the consumer. The width and depth of the product on offer will decrease to reduce customer confusion, plus this is an opportunity to reduce the brands on offer and to specialize in house brands or private labels. Clearly this means thinking outside of the box, but by doing that, you may come up with a unique offer for your consumer and this could allow you to separate yourself from the competition. John Stanley is a conference speaker and retail consultant with over 25 years experience in 15 countries. John works with retailers around the world assisting them with their merchandising, staff and management training, customer flow, customer service and image. www.johnstanley.cc