A Tale of Two Retailers

This is the fifth in our series based on Challenges of the Future: The Rebirth of Small Independent Retail in America, a 64 page white paper by Jack Stanyon, underwritten by the George H. Baum Community Charitable Trust, the Illinois Retail Merchants Association, and the National Retail Federation Foundation.  Today's topic is Competition.

Here’s a story of two retailers. I’ll call them A and B. What they sell really isn’t important to the story except that they both sell roughly the same kind of merchandise. They are truly specialty stores in that neither one sells anything that anyone really needs. If you were going to buy something in either store, it would be because the item caught your eye, or because someone sold it to you.

Dealer A and B are both located in a busy tourist area with lots of specialty shops and restaurants. It’s the kind of place you might go spend a Saturday afternoon which is exactly what my wife and I did this past weekend. The two stores are no more than a block apart.

Store A was busy. There were at least four people working there. There was music playing and the atmosphere was very conducive to buying something, which I did. I’ve been in this particular store many times. It’s always busy and I don’t recall ever leaving there empty-handed.

Store B was a different story. When we walked in, there were no customers in the store. The only person working there, who appeared to be the owner, was talking on the phone.  She was talking (quite loudly) to someone about how bad business is. She blamed gas prices, interest rates, the President, the stock market, chain stores, Al-Kaida, the bird flu, global warming, you name it. Listening to her side of the conversation, and it was impossible not to in the otherwise quiet store, you would think that we’re on the brink of another Great Depression.

While we were there several other people came into the store, looked around, and left. In that entire time, she continued her doom and gloom conversation, never once acknowledging any of her potential customers. When we left she was again alone in the store, continuing her conversation.

I would be willing to bet that at some point she told her phone friend that several people had just come into the store and left withoug buying anything, proving her point that the economy is in a mess.

I could go on about what store A did right and what store B did wrong, but you already know that. It all comes down to making your store an inviting, customer friendly place to shop. Store A is far from perfect. In all the times I’ve been there, no one has ever asked for my email address. No one has ever tried to up sell me or to suggest additional merchandise. But, it’s a pleasant place to shop. The people are friendly. The atmosphere makes it hard not to buy something. Store A is good with the potential to be great.

I feel sorry for the owner of store B. Remember, neither of these stores sells anything necessary. But, if store B were selling bread and milk, most people would still stay away. The atmosphere wasn’t inviting. Anyone who overheard and believed what the owner was saying would be just as likely to run home and bury their money in the back yard as they would be to buy something.  For the owner to not even say "hello" as people entered the store is inexcusable.   Store B reminded me of the auto parts store in an earlier post (Waiting for Things to Get Better).

When we consider our competition in the retail business, we’re likely to think first about the big box stores. They’re the ones with the big ad budgets and the huge buying power.  We seem to see their ads every time we pick up the newspaper or turn on the TV. It’s natural to think about them when sales aren’t what we think they should be.

But, face it, there are a lot of consumers who just aren’t our customers. They’re only concerned with price and we’ll probably never have a chance at their business.  They keep the Marts and the Depots in business.

Our target customer, the one who makes buying decisions based on value rather than price, is going to buy from us, or from someone like us. Our competition for that business is the store down the street, or across town, who’s also an independent retailer. That competitor has the same problems that we do. He or she is trying to tell the same value story that we are.

If we’re going to consistently win the business, it’s critical that we provide our customers with a pleasant, fun place to shop.  The difference between an independent retailer and Wally World is obvious.  The difference between two independents may be more subtle. 

Qustion, "What are you doing to make your store customer friendly?"