Power Realities in Retail

Retailers only exist to help solve customers' problems and/or meet their needs.  So, having a problem to solve (on a limited budget) I took myself off to my local mall which has recently undergone extensive refurbishment.

The problem ?  I run a few laptops for my SOHO biz, including a netbook – which is one of my favourite pieces of kit.  The computer has been fantastic (incidentally bought at the Harvey Norman store referred to in this story), but unfortunately the power pack has just died – which is a bit of a bummer.  So, I thought, I recalled Harvey Norman had a tech service centre, which might, just might, have a spare part or a universal adaptor.  I wasn't holding my breath though, but thought I would pop down and have a look.

I arrived at the fabulous looking 'new look' Harvey Norman store, and found the tech centre easily right at the front of the store.  I told the tech on duty what I was looking for – he appeared to be only half-listening, insisted on testing the power pack which I had with me (including my laptop bag slung over my shoulder), to find out it had indeed no power.  I was happy for him to be thorough, but his demeanour was a bit detached, as many techies often seem to be.

Anyway, I was pleasantly surprised when he said we could look at a local supplier – and pleased when he rang them up right there and then, to be told that the pack would cost $65, and take about 3 days to source.  I didn't have that sort of money on me, but was happy to spend it.  Imagine my surprise when he 'outsourced' the problem by giving me the supplier's local address and suggesting I pop by there.

He also suggested I speak to his colleague on the salesfloor who could see if they had a universal adaptor, and cautioned me against taking one of the wrong size.  So this was pretty good by the standards of my past experiences with HN, and so I thought, at least I can see how my problem might eventually be solved, and walked onto the salesfloor.

As mentioned, the store is brand new, and had all sorts of new shiny 'stuff' for me to look at, including the replacement model for my netbook – priced at $399 – which was less than I paid a few years back at the original HN store (price deflation is a key category issue). 

The fellow sitting at his little desk on the salesfloor looked a bit surprised when I spoke to him – I guess I had dressed down a bit, but I was carrying a laptop bag, and browsing in his department.  He got up and had a look at the universal product stock – not clearly marked, so I would never have been able to find it myself – and then tried to give me the wrong (larger) one, which I refused.  He said "the little ones have been out of stock for a while, but we will get them in again some time". 

Ok, I thought, I will go down to the local supplier, and carried on browsing through the netbooks – thinking that maybe if I could find one with the same adaptor connection I could at least charge my laptop for a few minutes.  Another, female staff member breezed on by pleasantly greeting me, but not offering any assistance.  I must have spent a few minutes touching, looking at the replacement model, thinking this was my backup plan, and left the store.

With my favourite JB Hi-Fi store in the same centre, I popped in there, to discover they had 15% off my preferred netbook brand, and had a look at the range, which was disappointingly small.  I explained my problem to the young Gen-Y assistant, dressed with impossibly good street cred, but he seemed unexcited about my problem.  I then specifically asked him if I could charge my machine, but he couldn't find a machine to suit, and gave up.  I left the store, reflecting that I had previously spent quite a lot of money at JB, including having purchased the second (backup) netbook at this specific store.

On my way home in the car, I thought I should do a bit of research on the web – which I could have done in-store on my iPhone, but I thought would be poor manners.  Anyway, it turns out that the supplier has significantly better prices on the replacement model netbook than both HN and JB.  Hmmmm…

I have previously been aware of eBay, and other similar services, but have never really spent a lot of time on them.  Imagine my surprise then when I easily found the exact model item (power adaptor spec) available for $21 – including express shipping (from Melbourne).  And then I was off, with a solution to my problem in sight…… those of you who are familiar with shopping on eBay would know what happened next – I was overwhelmed with emails saying my purchase was successfully completed, the item was in stock, and yes, it had just shipped…..

In the process I window-shopped prices on my preferred replacement netbook, and, yes, the Australian-stocked prices and options available were far superior to HN and JB.  Their two online stores were frankly disappointing.

My first reaction was that I was annoyed that I had almost overpaid for the item.  On reflection, I thought, why had I bothered to go to the stores at all ?  Knowing that the web offers access to a wide range, surely the retailers realise they need to differentiate on service.  Now, while the techie had given me better service than I expected, I realised that he had simply passed the buck – I didn't want my problem 'outsourced' – I wanted it solved.

So, if bricks and mortar stores don't offer better service, does that mean they are in danger of becoming merely display shopfronts for the web ? 

As an aside, some retailers would say that they wouldn't make much margin on an item as small as a power pack.  This is a transactional approach to retailing – so old school.  My problem was hugely significant to me – they had an opportunity to build a relationship with me, and decided not to take it up.  (In fact they both already had a relationship with me, but didn't realise it.)  They have removed a big reason for me to ever go back – unless I want to touch and feel a new product, that is.  I now have more power than I did previously – I guess they just haven't adapted to that reality.

As I sit writing this, the doorbell has rung – it is the postie with my replacement, express post. Not bad considering I placed the order at 3pm yesterday.

And by the way, there was not a $1,000 GST threshold in sight in this process.

Vending machine dispenses ebooks

Source: PSFK

An interesting item from PSFK about a Japanese vending machine that dispenses ebooks using QR codes.

What other digital content can be distributed in this way ? 

Retail Pain

Not a great time to be in Australian retail - mirrors international trends - it is significant these items were all on the Inside Retailing website today:

		David Jones chief sounds warning bells DJs chief describes a "dramatic" slump in retail sales.
		Sales seasons stretched as shoppers turn savers Conservative shoppers are picking out bargains at Australia's biggest department stores as half yearly sales run into late July.

		Consumer sentiment nosedives Australian consumer sentiment is at its worst since the GFC

Yesterday's most read story
		Retail conditions worrying Conditions in the retail sector have fallen to "worryingly low levels" in

Let's Get Fizzical

Lush, QVB.

Great window, merchandising concept and idea from Lush Cosmetics - apart from being colourful and standing out in a very crowded pedestrian (commuter mall concourse) environment, the quirky character speaks to the brand essence, and the fizz is a product feature.

The World of Crowdsourcing

Source: Sydney Morning Herald/ The Age
Stephen Saunders doesn't really think of himself as a designer or a retailer and he's not quite ready to give up his day job as a retail consultant. But he's part of a growing number of hobbyist designer/retailers riding the consumer revolt against what he calls retailing “mediocrity”.

==> Read more on the SMH site.
Interesting merchandising ideas and concepts

the STUFF-iT Design shop


I recently embarked on a new venture in the world of e-commerce through opening the STUFF-iT design store. I will be documenting some of the learnings here, as I believe they have relevance for those of us in the broader retail world, whether as marketers, advisers or shoppers.


First up learning is that the thirst for customisation of product by shoppers has spawned a number of alternate business models - see RedBubble and Zazzle as examples.  This is in essence the creation of their own content (nothing new in that) but then made manifest -the latter being the key point. Over time this will lead to a further questioning of the value of design in traditional retail stores.  This will present further challenges for retailers to differentiate on excellent customer service.


Please drop by the store, and as always I welcome any feedback.

Social Knitworking works for me

Sportsgirl, Eastgardens

I love this campaign by Sportsgirl - bringing winter warmth to social networking.  It also opens up some great merchandising ideas and opportunities.

Smiggle colors winter weather

i

Eastgardens cheerful window from Smiggle. Good merchandising idea for trans-seasonal.

Giving the Competition the Finger

Coles Waterloo. Impressive store level carry through of ATL campaign. Difficult to miss.

The Small Things

Source: RSR

http://www.retailsystemsresearch.com/_document/summary/1244

It's the small things that break retailers' holds on their customers. 

A great quote - I recommend you read this short anecdotal article about Amazon.

Smiggle Squiggle Scribble

Mid-city Plaza, Sydney.  Cool, quirky lighting from Smiggle - interesting to see how the format is developing, now with a clear 'Scribble' area too.  Very busy store.

Screw Romance

Lush, QVB Sydney.  I quite liked the way this merchandising idea stood out from the crowd - a brave move for Valentine's Day.  I hope their bravery was rewarded

RedBubble, Merchandising Ideas and the Future of Retail

I recently signed up for the RedBubble service- essentially a shopfront for artists and designers which provides fulfillment services for the production and distribution of framed prints, t-shirts, calendars, greeting cards and the like.  I was admittedly skeptical but was searching for a way to commercialise some of my (modest) creative output.  I have now been posting entries to both the arts section (my portfolio here) and the T-shirts section (portfolio here) for a few weeks. As many of you know I have been promoting myself via Twitter and Facebook.  To my surprise and delight I have even made a few  sales !


However, I wanted to share with you the merchandising ideas I have observed in RedBubble's approach, and at a time when Australian retailers have belatedly woken up to their customers shopping on the Net, a few thoughts on the future of retail.


I was delighted yesterday to receive my first package from RedBubble.  I had ordered a few of my t-shirt designs - for my ego, yes, but also to market them directly, and also to assess the quality of fabric and rendition of the images.  Here is what arrived:

Prior to this, they had done all the best practice stuff for e-commerce - letting me know when my order was being processed etc.  I was very impressed with the cool packaging - the 'attitude' was right on brand as well.


I strongly suggest you visit their site to check out their brand style, tone and manner - irreverent, quirky, relaxed without being 'way out there', ie. still accessible.  Here is another illustration - best warning label I have seen :)

What a cool merchandising idea - they just keep selling the brand's benefits without being intrusive.


And then there was the big 'reveal' for me:  I have to admit to being a tad nervous - not that it had been a huge outlay, but my fragile ego was involved :). I was delighted to see the shirts packed and folded carefully, with a card for washing instructions.  The quality of the fabric is great: super soft, very comfortable to wear.  


I was nervous about the sizing - as you can see from the photos I am not in the 'small' category :)  However, they were excellent fits, and very generously sized, which is not something I can say about most t-shirts I buy locally in the shops.  I have very seldom found my size, the 'cut' has always been stingy, and the quality of fabric mostly poor - admittedly these have been sub-$50 t-shirts.  Personally I do not see myself paying more for a t-shirt.


I landed these in Australia for well less than $40 each.  Delivery time was 15 business days which I thought was pretty reasonable for the busy Christmas and holiday period.
So, here they are: 4 designs:

  
The Hawk
http://www.redbubble.com/products/configure/6436330-t-shirt

Bucket List Cities
http://www.redbubble.com/products/configure/6453779-t-shirt

Iconic Sydney
http://www.redbubble.com/products/configure/6446339-t-shirt
and

Life's a beach
http://www.redbubble.com/products/configure/6467433-t-shirt
So, what does this all have to do with retail ?
Well, I make my main living advising retailers - mostly of the bricks and mortar kind.  Here is what this means:


1. The future is about shopper control and customisation - in this case, choice of colours, sizes, and design (either my own or someone else's).
2.  Savvy web retailers are setting new, increasingly high  standards for customer service - quick response times, well-considered web sites, great FAQs, no questions money-back guarantees, free shipping - which will totally de-risk the purchase for shoppers.
3. Oh, and did I mention it was convenient ?  All done from my iPad or similar - pick a device of choice.  Admittedly I had to wait a while, but if I was really desperate for a t-shirt I might have popped down to the mall. I saw the waiting time as the trade-off for getting exactly what I wanted.  And yes, most of what we buy does fall into the 'wants' category - and people are prepared to defer acquisition to get what they want, as opposed to what they 'need'.
4. There's a great community of fellow travellers - who inspire and motivate.
5. There is huge choice - have a look at the site.
6. The products are authentic - the products of individual passion, not some faceless machine.
7. The culture is strong and distinctive - helpful, friendly, but quirky and full of character and humour - just look up Mr Baxter on RedBubble.  Many retailers have created humourless environments that fail to inspire.
8.  The price is right - the market will decide - moving around Sydney CBD earlier today I noticed designer t-shirts everywhere (perceptual vigilance :P) and noticed how almost all of them were 30-50% off, and then still more expensive than what I had bought.
Once you get what you want - as a shopper as with anything in life - it becomes addictive. almost liberating, a bit like being a bird, really.