Thoughts from our founder, Kevin Slade.
The world of retail is changing and the need for a change in strategy has never been more critical. Together we can make retail brilliant again, bricks and mortar retail will never die but boring retail will!
I read articles written by lots of smart individuals discussing the state of retail and the unprecedented challenges we’re all facing as an industry but none in my opinion seem to truly tell it as it is, so in my usual style here is my attempt to cut through the crap and call it as I see it…
I may have been involved in the retail industry for far less time than many others, but my time has felt like dog’s years… I’ve been through the good times of prosperity and the bad times of recession and economic uncertainty. I’ve seen brands and retailers throw huge budgets at projects but also try to do other projects for next to nothing.
One thing for sure is that my time served to date has made me hugely passionate about the world of brands and retail. Which is why despite it being an extremely tough time right now, I will not turn my back on it and instead want to do what I can to help make it brilliant again!
The state of retail…
We all know that the world of retail is becoming tougher by the day and with so many big high street and global brands falling by the wayside the need for a change in strategy has never been more critical. A change is needed in the way we think about retail, the type of environment we create for the consumer and the way in which we connect retail with online.
If we look at the retailers that have hit the news over the last 12 months… the likes of Toys R Us, Maplin and Poundworld have gone out of business; House of Fraser, HMV and Evans Cycles are in administration and New look, Marks & Spencer and Homebase are closing stores. This ever-growing list across so many markets becomes more and more concerning, now all these examples are from the UK alone but the issues are all around the world, regardless of the economic climate of any particular country.
I have long been championing the need for change by both brands and retailers as well as pushing the message that bricks and mortar retail will never die, but boring retail will!
I believe that everyone involved in the retail industry has their part to play in saving it and making it strong again. This means that brands, retailers and service providers alike need to join forces as it will take more than a band aid to hold this industry together. It requires a new, open minded, brave and bold approach to succeed.
How has retail changed?
Consumers still want and need physical stores however they expect a consistent experience across all touchpoints. As a result, retailers can no longer look at their online and in store operations in isolation, we need to give the consumer a reason not to default and shop online. In the case of in store retail the brands and retailers have the power to create and deliver retail experiences something that E-Commerce cannot provide.
However, to ultimately win it’s also important that brands and retailers do not simply pick a channel to solely focus on, as this notion of a battle between bricks and mortar and online retail as though there can only be one winner is nonsense.
When considering the instore part of the puzzle we need to evolve the experience beyond fulfilling consumers basic functional needs of stock on the shelves. Today consumers demand to be engaged instore, they need to feel like they are getting something over and above what the internet alone can offer whilst in an environment that is consistent with the brand or retailer’s look and feel online but above all else it has to be an enjoyable experience. If they gain all of this, they are likely to want to spend and more importantly likely to return.
In reality both the physical and digital are intertwined, in an ever evolving omnichannel world retailers must invest in bricks and mortar stores to feed their online presence and vice versa.
What do brands and retailers need to consider?
This one for me is incredibly uncomplicated… their customer’s needs and wants!
Stop thinking that ‘if you show them they will come’ because how’s that worked out for the retailers named above who all had that approach?! A common failure of all of the retailers that have hit hard times of late is that they offered the consumer nothing other than products on shelves; with no thought to the customer journey, interaction or engagement.
The frustrating part is that none of this is rocket science and doesn’t have to be really expensive, or overly technical to deliver a substantial change. Sure, there is almost an endless number of ways to blow big budgets on elaborate shop fits, state-of-the-art tech to deliver things like endless aisle shopping, product demos and in-store attractions but the fact is that almost any budget can be optimised to deliver an engaging retail environment and therefore a solid ROI for both the brand and the retailers.
The importance of brand…
We all know that brand awareness plays such a major part in success but is it everything? Given that some of the retail brand names previously mentioned had huge recognition, I would say not!
Attaching a consumer experience and connection of a brand to their brand awareness could help massively in this mission to make retail brilliant. This is something that can be easily overlooked and so needs to be part of the considered strategy, otherwise all the brave and hard work in changing the approach could be for nothing.
So how do agencies play a part?
Once again, the theme here is a need for change… the marketing, distribution, creative services and POP agencies must also evolve if they are to be a useful asset and partner to the brands and retailers. If they don’t then more retailers will go out of business meaning that fewer brands will be able to survive or exist, other than online, resulting in a huge down turn in business opportunities for the service providers too!
Agencies have to realise that the brands and retailers no longer have the resources they once had in-house and so as bandwidths get more and more stretched, time to manage multiple agencies becomes tougher and so the need arises for the service providers to pick up the slack and help carry the burden.
Distribution – has and always will be a vital part of the process, however with more and more distributors claiming to offer “value added distribution” with services such as marketing, brand building and POS watering down their core purpose. There seems to be a need for the distribution world to stick to what it’s best at – efficiently facilitate the transaction and movement of stock. Which is actually exactly what the brands and retailers really need from them.
Creative and POS agencies – the writing is on the wall if they don’t change their approach. It is no longer an industry where the ROI of a project is simply something that gets mentioned as part of the sales pitch. The agencies have to understand it and help the brand and/or retailer to ensure that it is delivered. We need to put our clients first and ask will this deliver what my client wants and is this the best use of the budget and opportunity?
Conclusion – The need for a collaborative approach…
In such a tough predicament as retail finds itself in today, it’s clear to me that brands, retailers and agencies all need to partner up and work collaboratively if we are to succeed in building a long-term sustainable industry.
An important dimension to the success of the retailers’ physical retail ventures is through brand perception and awareness: this is their showcase. Physical retail locations are places where brands have the opportunity to make genuine connections with consumers who are wanting to be more engaged and informed than ever before, so why not make the most of this?