filling shopping bags by filling needs

For the retail industry, the Great Recession has become the Great Malaise.

Last week, Karen Talley reported in the Wall Street Journal that most retailers missed expectations for May. While there were some bright spots, the 25 retailers tracked by Thomson Reuters posted 4.9% growth in May same-store sales, instead of the expected 5.4% gain.

Retailers have a lot reasons for their current lackluster performance. Gas prices and food costs are on the rise, while consumer confidence is down.  Then there’s the weather – Mother Nature has not been kind to retailers.

As Janet Hoffman, managing director of the retail practice at Accenture, says, “The cards are stacked against the consumer right now and retailers will have to work hard to bring them into stores.” I’m guessing that for most retailers, “work hard” will translate into aggressive promotion.

But sales and price promotions are a short-term, reactionary approach that usually denigrates the brand, crushes profitability, and trains customers to only buy on sale. The path out of the malaise and into sustainable brand health and business growth requires a far more customer-centered approach.

To thrive in the long-term, retailers must remember they’re in the business of doing more than moving product out the door. Retail experiences must fill customers’ rational, tangible, and emotional needs.

Intimacy, a women’s intimate apparel chain with 15 stores, and Hot Mama, a 17-unit chain selling designer clothing for moms, provide excellent examples of retailers who are doing more than selling product – they’re filling customers’ needs and their shopping bags.

rational needs

Nearly 20 years ago Susan Nethero created Intimacy to meet a very rational, very common problem – most bras don’t fit right. Ask most any woman and she’ll tell you, her bra either doesn’t look good, causes back pain, and/or renders her clothes ill-fitting or unattractive.

Hot Mama was founded to solve a different, but just as common rational need – it’s hard for moms to shop for themselves. CEO Megan Tamte knew all too well from personal experience the challenges of shopping with fussy kids in tow, strollers and diaper bags that make a sport out of navigating store aisles, and a hard-to-fit post-baby body.

The needs that gave birth to these chains make them relevant and compelling retail ideas to customers.

tangible needs

But these retailers do more than resonate intellectually with customers. Both have designed their store experiences to address customers’ needs tangibly.

For Intimacy, that means fitting all customers for their bras. Fitters go through a week-long “bra boot camp” which trains them how to make women look like they’ve lost 10 pounds or regained the lift they had 10 years ago.

Hot Mama takes a similar approach to employee training. Their “stylists” go through three certification programs – denim, body type, and maternity. As a result, “Our stylists can outfit any woman, aged 25 to 65, based on her body the minute she walks through the door,” says Hot Mama President Kimberly Ritzer in a Fast Company article featuring the chain.

Eighty percent of Intimacy’s inventory is European designer brands that are hard to find in the U.S., so their exclusive product mix is another tangible way Intimacy meets their customers’ needs. Also each of their stores carries approximately 15,000 bra styles in over 90 bra sizes so they have the right style and fit for every woman. And, as Intimacy’s website explains, their dressing rooms are “state-of-the-art” and “lit from floor to ceiling in an effort to give each woman a beautiful and unique glow.”

Each Hot Mama location has video games, movies, toys, and coloring books to entertain children and puts them in the center of the store so Mom can keep an eye on her kids. Every aisle is wide enough to accommodate a two-seat stroller, and sales employees often take on babysitting roles as their customers try on clothes.

Clearly the in-store experience at both retailers fills their customers’ tangible needs.

emotional needs

Most importantly Intimacy and Hot Mama fill their customers’ emotional needs.

A BusinessWeek write-up talks about how “bra psychology” has fueled Intimacy’s growth. A half-hour of pampering at one of their stores shows customers how properly fitted lingerie “transforms their figures, style, and, more important, self-image.

The chain’s website features an emotional declaration: “A woman’s confidence will soar with a bra fitting…She is amazed by the new level of confidence she never believed possible. {intimacy} creates intensely powerful relationships among women by encouraging each woman to love herself first.

For Hot Mama, giving a mom 15 minutes of shopping peace fills her emotional bank. So does finding cool clothes that flatter her new body type.

Tamte’s website message concludes with an uplifting statement: “Each mom is a Hot Mama, but it’s easy to lose sight of that in the midst of motherhood. My greatest hope is that moms walk into our stores feeling like we are a store just for them and out our doors CONFIDENT that the Hot Mama within them has come alive again!

the results

The rational, tangible, and emotional resonance created by these two retailers has produced remarkable business results. In 2010, Intimacy generated $35.5MM in sales, which was a 27.5% increase from the prior year. Hot Mama hit $15.1MM in 2010, a 62% YOY increase. (The industry average was less than 3%.) Both chains are continuing to open new locations this year.

These retailers demonstrate that filling customers’ needs extends beyond having a good product. It means truly understanding their pain points, lifestyles, psychology, and values. This kind of customer intimacy is the only way retailers are going to get themselves out of this current funk.

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