Boiling Frog Syndrome……….
Having just returned from another two month International trip I was relieved to find that:
a) Nothing has changed with the customers old and new.
b) Nothing has changed with the way consumers buy goods.
c) Shoppers continue to flock to the regional malls.
d) Mediocre service, inconsistent availability and lacklustre presentations are just fine.
e) Uninteresting experiences are cool.
f) Online is dull and only a minor distraction.
g) People just buy buy buy!
NOT.
I have commented too many times that for retailers it appears to be “business as usual” when quite clearly it is not. Does anyone know of any major retailer doing things significantly differently with their bricks and mortar, because I have yet to see it.
The collapse of rentals, the acceleration of closures and stores on permanent “sale” is giving mall owners and investors sleepless nights and for good reason. The share prices of the majority of the listed retail sector are down and in many cases plummeting, with investors seeing little sign of cogent fightback strategies; closing stores and permanent “sales” are hardly growth strategies.
It is not as if traditional retail is lacking some key tools to get the job done and when I read vastly experienced retailer Andrew Jennings’ reiteration of having a clear and relevant “point of view” and the power of customer service as being essential ingredients, the baseline is not rocket science but even these fundamentals are missing in action in far too many businesses. Not surprisingly those few that are getting this right are proving the most resilient but substantially attitudes need to change and change fast.
I will be attending our annual shopping centre congress later this year and I was a little frustrated to read that the theme is “Evolve”; whatever happened to “Revolution”. Retailers are like the tale of the frog placed in a pan of water which is then slowly heated to boiling point; the frog only realizes it is being boiled when it is too late. The frog that is dropped directly into boiling water immediately jumps back out! The question I pose to retailers is: if you have an opportunity to start a retail business from scratch today, how would you design it?
Can retailers afford to just evolve when their customers are already well into their revolution?
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5yHi Paul. Good and timely article. Retailers don’t engage with customers as they should. Malls don’t know their customers either. Imagine if the available data could be used to drive higher sales and conversions? Footfall is a vanity. Conversion is the new reality! It’s funny that malls do so little to drive conversions thinking that footfall will lift all ships. So sad that all those lovely malls you helped build are depleted of sales The solution is in the data and in the science of the management of the data. Ask malls these two questions: what is the proportion of non-gla income to total revenue AND what is the proportion of revenue share (turnover rentals) to total rentals? How many know? Knowing the answer to these questions will lift their investment returns. Want to know more? Warm regards. J