Merchants Must Assess Whether There Is a Match Between Opportunities to Distinguish Themselves From the Competition as Well as Their Capability to Leverage These Opportunities, CBX Executive Writes
While savvy merchants go out of their way to differentiate themselves from the pack, a strategic approach to change is essential to survival in today’s increasingly competitive retail environment, writes Joseph Bona, President of Branded Environments at brand agency and retail design consultancy CBX, in a guest commentary that appeared earlier this month on www.chainstoreage.com, a retail management publication.
In the column, titled, “Staying the Same is Not an Option,” Bona states that retailers can neither afford to operate stores whose appearance, merchandise mix, level of service and other attributes closely resemble or mirror those of their counterparts, nor rely on previously effective tactics to sharpen their competitive edge. “Gone are the days when a lagging chain can take a ‘me, too’ approach and try to eke out an existence by copying successful innovators,” writes the veteran store designer. “Nor can you save a bad retail proposition by making incremental improvements alone — things like cleaner floors, brighter lighting or a new customer-service manual geared toward plastering smiles on the faces of your employees. Tweaks such as these might have worked 10 or 15 years ago. Today these kinds of changes are table stakes.”
“But if staying the same is not an option, how should retailers tackle the challenge of change?” he asks, noting that the first step for merchants entails assessing whether they possess the prerequisites for capitalizing on opportunities for transformation. “Once you identify an opportunity in the marketplace — something like the brand-building and cost-saving potential of private-label products or the trend toward prepared food — the next step is to take an honest look at whether this opportunity matches your capability,” he advises. Retailers must determine if they have the corporate culture, back-end systems, financial strength and human resources necessary to support the potential change and, if not, whether the opportunity merits the effort required to attain them, Bona contends.
Ensuring that changes under consideration jibe with “brand attributes” is equally important, Bona observes. For example, he notes that a chain widely regarded for its fast, personalized service would be ill-advised to implement a new program designed to slow down the shopping experience, under the pretext that longer dwell times will lead to increased customer spending.
Bona also counsels retailers to accept that change entails risks, but does not necessitate embracing every trend. “The focus should be on how individual technologies and services can bolster and fit into the overall mission,” he writes. “Where does the company need to be in the marketplace? Who does it most want to serve? What do these customers want, and how can you meet or exceed their expectations?”
The executive concedes that although innovating in retail is hard work compared with staying the same, remaining on the leading edge is possible when retailers are honest and realistic about the limits of their brand and the actual capabilities of the company. “Otherwise,” he concludes, “you fall prey to inertia, which is no option at all.”