A Refresher Course in Renewal
By David Kay
Owning and/or operating a retail business, whether you're selling goods (apparel, food, giftware) or services (restaurant, financial), is one of the most difficult types of business to be in today. The 1995 holiday sales period yielded a new high in going-out-of-business signs and bankruptcies in all types of retail establishments. Yet, we all still shop at every conceivable kind of store, from the morn-and-pops to the large "chains for the mundane" to the one-of-a-kinds.
Retailers who want to refresh and renew their offerings need to start by asking what their customers want. Many stores have failed because they didn't listen to what their customers told them. Using well-designed market research tools, those same retailers might have been able to turn the tables and bring customers back to their stores by offering what their customers want in an environment that is appealing and fun to shop in. Too many retailers have never gotten out of the complacency of the early 1980s when buying was at an all-time peak.
To stay competitive, here are some tips to consider for renewing your business.
Retail renewal must involve the entire package:
- 1. Store design (colors, textures, seating/tables, lighting, window and floor treatments, décor items, counters, shelving, plants, floor pattern, traffic flow, signs, uniforms/dress where appropriate, cash register, etc.)
- 2. Merchandise mix
- 3. On-premises merchandising
- 4. Brand mix, including private label
Look for consistency in the mix described above.
Fundamental questions should be addressed first. For example:
- 1. What is the desired balance between ease of shopping and ambience? Discount or warehouse-style retail/restaurant establishments usually want to maximize ease of shopping even at the sacrifice of ambience.
- 2. Do you want the business to be a "browse-in, linger-in" or an "eat-quickly, buy-quickly-then-leave" establishment?
Involve customers at all stages, especially before models/drawings are finalized.
Assume that your audience is sophisticated. They may not know the design buzzwords, but they know what they like and how they feel about your renewal attempts.
Be aware of the target groups' cultural mix. It varies by region, city, neighborhood and ethnicity. If you can vary your design template, do so.
Don't stray too far from your prime customer base. The new designs, merchandise mix, branding strategy and signs are for them, not for your designer, ad agency or staff.
Pay attention to detail. We evaluated a restaurant that had a European motif, but Mexican- style pottery artifacts. It jarred.
Be prepared to renew your premises every five to seven years.
If you set up a redesigned test store, restaurant, bank branch, etc., don't put it into a "B" location to reduce the risk. If it fails, it may not be because of the design or concept. It may be because of the location.