Once upon a time, a trip to the US gave a foretaste of the future of retailing, in terms of store design and new formats.
Once upon a time, a trip to the US gave a foretaste of the future of retailing, in terms of store design and new formats. While there are still interesting things to see - not to mention the commitment and enthusiasm of so many retail employees - the UK, at least in terms of online trading, is now in the vanguard of retail change.
It was on a US visit back in 1997 that I first read that “a new measurement of retail success is emerging, related to how well a company is succeeding in owning specific customers”.
This need and desire to better understand customers led to Walmart’s investment in data ‘warehouses’ and the frequent shopper programmes pioneered by Tesco and Boots. But what struck me back then was the assertion that, just as important as the role of technology, would be truly customer-focused retailers discovering that they would need to be more creative in the recruitment and utilisation of employees; recruiting more professional sales assistants who act as ambassadors, who know and establish relationships with highly valued customers. Sadly this remains the ‘missing ingredient’ in UK retailing despite the shining example set by John Lewis. Staff training should focus on ‘suggestive’ selling, problem solving, relationship management and more in-depth product knowledge.
Online growth provides a new opportunity as shop traffic reduces and each store’s main purpose changes. To compete, stores need fewer but higher-quality, better-paid staff, as well as to provide a more experiential experience. In this respect, the US, led not by a retailer but by Apple, remains ahead of us. On my last visit I checked out RRL & Co, the Ralph Lauren format. It is designed as a 19th century Mid-West outfitters where even the staff dress appropriately. It is worth a visit for the decor alone, but even I couldn’t convince myself that I needed a pair of faded and ripped jeans - however artfully designed the tears are - for $300 (£194).
What has always fascinated me about retailing is the wealth of new opportunities which, in an age of increasingly promiscuous consumers, have increased exponentially.
Dominant category killers such as British Shoe Corporation and JJB Sports have disappeared, and as retailers grow and become more complex and difficult to manage this perhaps represents natural evolution. Add in either management ineptitude or complacency and it becomes historical inevitability. At the best of times forecasting is far from reliable - I look at my own predictions as examples.
In the mid-90s for example, a popular expectation was robotics - within a decade there would be robot packers to load your shopping in the car, while shopping carts would both scan purchases and take the required payment.
Will this now happen in the next decade?
I have questioned before whether the accepted rules relating to traditional retailing apply equally in the virtual world. If so, the whole premise of first-mover advantage should be viewed with some suspicion. Could even the mighty Amazon be threatened by other new retailers a decade from now?
- John Richards, Retail Consultant, McQueen