3.082010

six best practices in retail

I’ve been working with a major retail brand and my engagement has included an audit and assessment of retail best practices.  Although most of my work is proprietary, I wanted to share some of my findings here because I’ve found some really interesting patterns.
My investigation covered several different retailers (selected for confidential reasons), representing a range of non-apparel product categories, and business sizes and scopes, including:

  • The Container Store – the $650MM “original storage and organization store”container Store Logo
  • IKEA – the Swedish home furnishings big box and catalog conceptIKEA logo
  • Uncommon Goods – the niche catalog and online gift retailerUncommon Goods Logo
  • WegmansWegmans Logothe $5BB regional grocer with 75 stores in 5 states
  • Williams-SonomaWilliamsSonoma Logo the $3BB “catalog for cooks”

Although each of these concepts has its own strengths, together they paint a good picture of what works best in retail.  Here are 6 best practices from the group:

1.    distinctive brand personality
More than the products these companies sell, their brand personalities are what distinguish them from less remarkable concepts in their categories.  From The Container Store’s positivity to IKEA’s pragmatism to Uncommon Goods’ whimsy, the personalities of these brands are distinct and memorable.

The brand personalities manifest themselves in the entire shopping experience – from the visual strategy to sensory stimuli to product assortment to customer service to tone of voice in messaging.  In fact, you could take all the branded signage down and still know you are in a particular brands’ store.

Generally speaking in retail companies, merchants drive the business – they set the brand strategy through the product range and assortment they cultivate.  But the strength of execution on brand personality in the concepts I investigated suggest that marketing, merchandising, and store operations are all working together to deliver a distinctive personality which permeates the entire customer experience.

2.    self-promotion
Most of these brands are unabashed in their self-promotion – they very clearly communicate their product and brand stories, and their features and services.

But I’m not talking about advertising or PR.  In addition to these traditional methods, the companies I studied integrate their brand promotion into the actual customer experience. Through pages on their websites, in their catalogs, and in their in-store collateral, they actively promote what makes them different and better than other companies.

Wegmans, for example, explains in a website section “How Wegmans Supermarkets Compare to Others.”  Folksy stories about the company and profiles of designers are sprinkled throughout IKEA’s catalogs.

Executing on your brand promise (doing what you say) is obviously the priority for any company – but once you’re doing that, it’s OK to let people know.  This kind of self-promotion is welcome because it has integrity and it invites people into relationship with the brand.  And it’s not considered bragging if you’re good.

3.    value added services and content
Every one of these retailers delivers more value than their product alone.

Some add value to their products through the stories and details they provide about their products.  Uncommon Goods tells its shoppers about the origins, cultural significance, and manufacturing processes behind their products.  In doing so, they enable customers to buy into shared values and significance.

Others show how to use their products.  Whether it’s recipes from Williams-Sonoma or organizational tips from The Container Store, the value of these brands’ products increases as customers’ usage of them improves.

Design and installation services are additional sources of revenue for IKEA and The Container Store.  Classes play a similar role for Williams-Sonoma and Wegmans.  So these are smart business offerings – but they’re also smart marketing approaches, as they facilitate more personal interactions and engender trust among customers.

4.    sensory engagement
When a customer walks into a Williams-Sonoma store, she gets a feeling of walking into a kitchen.  It usually smells like food because there’s a cooking demonstration or samples being offered; customers’ sense of taste are also tickled by these.  Kitchen furnishings are used for displays, fabrics cover many surfaces, and aprons are worn by the staff, engaging the visual and tactile senses.  It’s a full-sensory experience.

Uncommon Goods which does not have physical locations engages its customers’ senses through its multi-media website.  Sound files let you hear what an alarm clock sounds like; videos show you what products do when they’re turned on.

An immersive, entertaining shopping experience comes from engaging as many senses as possible.

5.    cross-channel shopping experience 2.0
As recently as only a couple of years ago, retailers could distinguish themselves by offering the option of ordering a product online and then picking it up in store.  Or of buying a product a product online and returning it to the store.

Now these options are expected and quite commonplace.  To really stand out and serve customers well, retailers must take the cross-channel shopping experience to the next level.

The Container Store stands out as a leader in this area.  Their “Go Shop” platform offers services support their brand value of simplicity and streamlining, including options such as:
–    order online, call when you’re on the way to the store, and get the product delivered to your car when you arrive.
–    use a scanner instead of a shopping cart to select your items in store and get the products delivered to your home.

IKEA and Wegmans not only allow you to create shopping lists online but they produce itemized print-outs indicating where you can find the items in store.  IKEA also informs you whether or not the product is in-stock at your local store.

No doubt, these tools and processes not only make it easier for customers to shop; but they also make it easier for them to buy more.  So facilitating cross-channel shopping is a win-win for the companies and their customers.

6.    strong organizational culture and values
Almost all of the companies I researched have strong organizational cultures and values. And these are manifested in a superior customer experience.

Wegmans and The Container Store are renown for how well they treat their employees.  No wonder their employees seem so happy and are so helpful!  IKEA’s earth-friendly business practices and commitment to product affordability make their products unique.  The value Uncommon Goods places on social responsibility is a primary reason why people shop the brand.

As such, these companies are the ultimate examples of what a brand is – that is, a brand is a bundle of values and attributes which define:

  • the value delivered to customers
  • the unique way of doing business with all stakeholders.

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  • Marc Rullo

    While the retailer, any retailer is a brand destination unto itself, how does the assorted brands within that retailer (brand destination) fair? Is the assorted brand a representitive element of the retailers brand or just one of many offerings that has no real distinguishing value beyond an ingredient for their brand receipe? Once upon a time a retailer was defined by the brands they assorted and the expertise they provided to support those brands to the end user. Then the value of retailers brand (differentiation) and their house brand became much more paramount based on volume and obvious margin opportunities compared to historically established recognized brands with less direct margin opportunities. These are elements of the bundle of attributes as well…..

  • http://deniseleeyohn.com denise lee yohn

    marc — you raise an important point — i still believe that retailers can and should be “defined by the brands they assorted and the expertise they provided to support those brands to the end user.” it seems some retailers have forgotten this in their pursuit of developing house brands.

  • http://www;wow.be Gavin Watt

    Good blog. Thank you for the summary.