The news in this morning’s paper–front page–is the same. Retailers are hysterically worried about another “bad Christmas.” Consumers have tightened their belts, hidden their credit cards and won’t even walk into a retail store unless there’s a big “70% off” sign in the window. What’s going on?
I think retailers need to step back mentally for a moment and ask themselves if they’re killing off customers faster than lemmings jumping off cliffs. Have retailers painted themselves into a “wait until Christmas” sales corner? Leaving aside the rotten economy, will retailers die a slow death?
While in a Target store a week ago, I overheard one woman talking to her daughter or son on a cell phone about buying a box of cereal. I heard her say that she’d buy the box of cereal at Target–not exactly a pricey place to shop–but she really should buy the cereal at Walmart because the price is cheaper. How much money she’d save at Walmart on one box of cereal is beyond me. But her behavior is indicative of a majority of retail customers today. “I’m not buying unless I get the best price.” So much for Gucci shoe sales.
Why are Amazon.com and Apple computer successful and profitable even in our collapsing economy? Amazon only sells online; Apple sells through retail and online. Why are they successful? Do they offer the absolutely lowest prices? No. Do they beg people to walk into their stores or go online with banners that read “50% off if you buy today?” No. Both Amazon and Apple are brands that communicate value, excellent service, superior products and 100% customer satisfaction.
Unlike storefront retailers that rely on 40% of their annual revenues during the Christmas season, Amazon and Apple market themselves throughout the year–not just during the holidays. They’ve developed 12-month relationships with customers. Do they have specials and promotions during the holidays? Of course. But they don’t rely upon them to grow and prosper.
Here’s what just popped up on my Amazon screen. Top of the page: “Hello, Brian, we have recommendations for you.” Really? When was the last time you walked into your favorite retail store, met a smiling sales person who knew you and personally walked you over to the sweater department because you like sweaters?
Next down the middle of the Amazon page is “new for you”–items that match product categories I’ve previously purchased and they’re “NEW.” Everyone likes to look at new products that match personal interests even if you’re not interested in making a purchase at the time.
What’s next on the Amazon screen? “Recommended for You.” Wow, me? In a retail store, searching for items is frequently like wandering at a garage sale. Unless you know what you looking for, you spend unnecessary time finding items you want to buy. Not at Amazon.
Next down the Amazon page: “Selected for You” shows three or four books related to other books I’ve bought from Amazon in the past. Amazon doesn’t blast me with large retail signs or hefty Sunday newspaper ads. Amazon clearly uses database marketing to show me products that will most interest me. Then Amazon let’s me decide to check out the items further.
Amazon’s “Most wished for in health and personal care” is particularly enticing. Only one of the four items interests me. But that’s o.k. As I click through the store’s webpages, Amazon continually presents new, relevant products that might interest me. They don’t force me to wade through multiple screens of irrelevant product suggestions.
Enough about Amazon. What about visiting an Apple store? When you walk into an Apple store, you find extremely knowledgeable people who have answers to your questions about computers and other Apple products. Demonstration models of virtually everything are available in the store. If you’re putting together a computer system or want to build a home network, bright and informed reps help you choose the right products. They are customer-focused.
Does Apple woo you with 20% off if you buy today?” No. Do they recommend products that are clearly unsuited for you? No. Do they ask questions about your needs? Yes. When you walk out of an Apple store–even if you don’t purchase–do you feel good about the experience? Yes. My kind of store.
Back to the original question “Are retailers killing off their customers?” A definite “yes.” How can retailers resuscitate customers who are about ready to expire? Follow Amazon’s and Apple’s strategies.
While brick and mortar stores can’t emulate e-commerce sites or Apple Computer completely, they can survive and prosper throughout the year by communicating better with their customers and by becoming totally customer-focused.