The State of Shopping

by Alex Cochran on February 12, 2017

I think that we are at the start of a pretty fundamental change in the retail industry.
This is being played out profoundly in the fashion segment. In the last 3 months we have seen a large number of mid tier retailers fail ( Payless, pumpkin patch, Marc’s, Howard’s storage, plus numerous others) this is being driven by the overhead in running a brick and mortar store in the face of reduced volume as this is now shared across offline and online players. Just have a look at the fall out in the states over Xmas ( Sears, Macy’s, gap,limited, American apparel)

What this is doing is making the offline shopping trip less compelling. There are less shops therefore less choice. This can only accellerate the decline. Landlords can slow this decline by readjusting rentals, but this is a hard pill to swallow and it will only slow, not stop the process.

So what does this mean? I think we will see offline move to more utility/commodity/service related purchases and online move more to the high involvement considered/descretion purchase.
Product freight requirements will also impact here. Ugly items will still be offline.

Winners
Warehouse stores – Costco etc
Greenfield discount department stores range adjusted to commodity
High street variety stores-
Big box hardware
Home delivered takeaway food
Installation/service retail
Furniture

Losers
Boutique fashion/fad
Shopping centre food
Shopping centre department/discount department
Electrical

The next 2 years will be telling.

This then flows on to ” discovery” online is really bad at satisfying browsing. With the advent of more and more targeted algorithms to narrow what you see, how do you get to know what you don’t know.

My feeling is that word of mouth recommendations endorsements from friends and colleagues will gain far more weight in the buying process than it now has.

We live in interesting times

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Customer Service – What’s Old is New Again

by Alex Cochran on April 6, 2015

King-Living Just over 25 years ago my partner Desiree and I decided to cement our relationship by purchasing two new sofas from a small furniture manufacturer called King Furniture. They had one showroom in Alexandria Sydney and had a reputation for producing some quality furniture. We wanted something that would last as we could not afford a home at this point, a pair of quality sofas was a measure of committiment to each other. We visited the showroom and purchased two beautiful leather sofas plus two ottomans that were “aubergene” in color, some people would call them purple.

Fast forward to March 2015. Desiree and I are still together, and yes our two “aubegene” sofas and ottomans still sit pride of place in our house. In fact this is the third house and is over 700 km’s away from the Alexandria showroom. The sofas have taken on a “magestic pattina” over the years as a result of kids, grand kids and a menagerie of pets and vistiors who have all lounged on the sofas.

A few weeks ago we had the unlucky occurance to knock one of the feet off one of the ottomans.

The foot was a sturdy plastic piece that had a number molded into the base. I thought what the heck, I will look up Kings on the Internet and drop them a note to see if they can help.

This was the start of a short but remarkable journey. In less than 12 hours I had a reply from “Lecia” from Kings inviting me to give her a call to see what we could do.

I called Lecia and explained my dilemma. After 25 years I had forgotten the name of the model sofa, she said just wait a second. She then proceded to pull up my original sales transaction, “just let me confirm your address” she said “to make sure I have got it right.” She then confirmed where we had lived over 25 years ago. “You purchased two sofas and ottomans is that correct.” I confirmed the details. “We discontinued this model many years ago, but I think I have a solution, just let me check with the boys out the back, I will call you back.”

I hung up the phone trying to reconcile what had just happened. Within a few minutes the phone rang, it was Lecia, “I just checked witth the boys and we changed the foot of this model when our parts maker changed from imperial to metric measurements, however if you make this slight adjustment this part will fix your problem.” She went on to explain the slight modification and then added “I have put 8 replacement feet into a post pack, can I confirm your new address”. I asked how much I owed her and she said “nothing”.

Within 3 days the replacement feet arrived and within 10 minutes the “lame” ottoman was back to new condition.

I am still in awe of this level of service, lets just deconstruct what happened here.

  1. 25 years ago the world wide web was less than 12 months old, ecommerce would not emmerge until 1994 and would not be really viable until 2000 when security protocols advanced to a point that made people feel safe.
  2. Point of Sale systems in retail stores where either manual or “land locked” proprietry systems.
  3. At some point in the last 25 years someone within the King Furniture organization realized that the legacy data held was valuable, but there needed to be a “key” to unlock this data. This key would no doubt come at a cost, but that cost was seen as an investment.
  4. Someone was charged with taking, who knows how many years of customer transactional and product model, component and spare parts data and putting into a form that can be accessed across the organization.
  5. A system was then deployed that would allow fast and seemless access to this data.

The result has produced a customer service tool and archive second to none. In a world where decisions are increasingly made on a “business case” basis, it is good to see a company that understands that the very nature of “business” means taking a risk. Investing in legacy data must have been seen as a risk, but today in a fast commoditizing retail world that risk is about to pay off in “spades”.

Long live the King………………

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The Best of Us Can Stumble- 10 Steps to Zero Moment of Truth

July 14, 2011

I rarely respond to banner ads (as does the majority of the population) However when I was confronted with an ad for Google’s latest tome “ZMOT-Winning the Zero Moment of Truth.” I just had to respond. here was the promise of research based insights into what’s important at that critical decision point where a prospect […]

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B2B is Dead. Long Live B2E

January 19, 2011

Can you keep a secret? Let me give you a tip! – today, nobody can. There was once a time when retailers were charged with the responsibility of “curating” information provided by a select set of vendors and then presenting this information in a moderated way to the consumer. Having control of this information channel […]

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Not all stories end with “They Lived Happily Everafter.”

January 4, 2011

You have probably heard the current furor happening in the retail industry where the major retailers are “bleating” about online retail having an unfair advantage in the current GST regime. Technically this is correct, but this is not the reason that the majority of retailers are feeling significant pain. Here in Australia our major retailers […]

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Retail Marketing – A Seismic Shift

December 2, 2010

There is a seismic event building in the retail marketing world. Like any major event it is starting as a barely perceptible deep rumble. There are a few monitoring stations starting to pick up the cues. But like any earthquake there are bound to be casualties. So what am I talking about here? Well we […]

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Has Jobs Done it Again?

December 1, 2010

In 1984 Apple launched one of the most talked about TV commercials in the marketing world. Contrary to popular belief this commercial only ran once in a paid format. Just to jog your memory here is the clip. This was a world changing moment. From these beginnings we find ourselves in today’s connected world. Are […]

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Retail – Not a Hobby Anymore

November 30, 2010

There was once a time when if you asked what someone was going to do in retirement, the answer would be, move to a seaside location and open a little shop of some sort. These were also the times when a lot of “significant others” (don’t you just hate PC) would operate a small store […]

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You Are Your Online Reputation!

November 24, 2010

Facebook could possibly change the balance of power in marketing communication with their new email initiative. Couple this with Googles priority inbox program and the rise and rise of peer reviews as a pre-purchase tool and we are looking at a seismic shift customer communication. Positive word of mouth endorsement, while always important, now shoots to […]

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A New Country?

November 21, 2010

I was reading an article yesterday and the author compared Facebook to a country. If Facebook does have north of 500 million subscribers, as is reported, it is now equivilent to the third largest country in the world. Only exceeded by India and China. Just think of the retail opportunity. We know where the customers […]

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