THE JOURNEY YO REMARKABLE RETAIL

Steve helps organizations understand and respond to retail disruption by creating customer-centric, memorable and profitable growth strategies.

The Fault In Our Stores

The following is excerpted from my just released book Remarkable Retail: How To Win & Keep Customers in the Age of Digital Disruption, which I finished writing and editing at the end of last year. Many people believe that the COVID-19 crisis is the proximate cause of quite a few retailers dire situation and imminent bankruptcy filings. Yet the bullet that will kill a good number of them was fired long ago.

Long-term trends, demographic, technological, and otherwise, have clearly exacerbated the issues for those retailers that find themselves stuck in the middle. But we shouldn’t lose sight of the fact that many troubled retailers are suffering from wounds that were largely self inflicted over a period of many, many years.

Far too much of retail is still filled with tired old ideas and an abject failure to pursue innovation. Many of the retailers filing for bankruptcy or closing large numbers of stores have barely changed in over a decade.

The same old mistakes, particularly an over-reliance on deep discounting, are repeated over and over again. Tour most regional malls or drive through a typical suburban shopping area, and you’ll find all the usual suspects and a veritable epidemic of boring, a maelstrom of mediocre.

During my career—and particularly during the past few years as a keynote speaker and consultant—I have traveled around the world and been exposed to a wide variety of different markets and retail concepts. One finding that is consistent, whether I am in New York, Los Angeles, Beijing, Sydney, Tokyo, Mumbai, or Dubai, is that an awful lot of retail looks and feels pretty similar. Virtually identical storefronts and websites. Look-alike promotional signs. One-size-fits all marketing campaigns. Merchandise presented in an uninspiring way on a sea of racks and tables. Lackluster customer service, if there is any service to speak of at all. And as for product offerings, they’re often all the familiar name brands with wide distribution, plus quite a few obvious knockoffs.

Department stores in particular have been swimming in a sea of sameness for decades. Now they are drowning.

The retailers that are struggling typically have both strategic and executional issues. From a business design standpoint they often sit in the middle of the price spectrum, offering neither great product value and convenience nor anything unique from a product, experience, or service standpoint. They sell fairly average “safe” products to the great masses of the population. A little bit of everything for everybody, nothing that special—or remarkable—for anybody.

Even worse, they are often deeply invested in real estate that may have been the right decision ten or twenty years ago, but today their portfolio is typically littered with many poorly performing locations. These stores are usually too big for the digital age and their design and layouts are anything but contemporary and attractive. The tired, outdated visual design of the average Macy’s or Dillard’s stands in stark contrast to the looks of fashion brands like H&M, Zara, or Supreme  or newer beauty brands like Bluemercury or Glossier. The amount of money that needs to be invested to update and reposition a weak brand’s physical assets is more than a little bit daunting.

Making matters worse, basic execution—housekeeping, staffing, keeping inventory in stock, and so on—is also lacking at many challenged retailers. Devoid of anything remarkable, their sales productivity and profitability are poor. Rather than trying to innovate, the most common reaction to dealing with lagging store performance is to engage in a series of cost-cutting moves—which tend to make an already untenable situation go from bad to awful.

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"The Store Operations Council enjoyed every minute of Steve Dennis's presentation on retail's future. He always keeps it real and speaks the language of retail experts."

Cathy Hotka

Principal

Cathy Hotka & Associates

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"The Store Operations Council enjoyed every minute of Steve Dennis's presentation on retail's future. He always keeps it real and speaks the language of retail experts."

Cathy Hotka

Principal

Cathy Hotka & Associates

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