Mid-Size Retail in Crisis

 

in the aftermath of “Black Friday” (or the Day after Thanksgiving), I read several articles about American shopping habits. Most of the articles I read indicated that there was a schism happening in retail. They told us that the more upscale retailers were doing well as were the discount stores like Target and Wal-Mart. In their view the American retail scene was duplicating society as a whole and the middle was disappearing.

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I don’t think I totally agree with this thinking.

What’s disappearing, in my mind, is a compelling reason to shop in the middle.

A few years ago I attended the annual National Retail Federation convention. One of the best panel discussions involved the the respective Chairmen of Ralph Lauren and Federated Department Stores. At one point Lauren’s Chairman said to the Federated Chairman, “No wonder you sales are down, all your stores look the same.” I think he was right.

In too many cases middle-level retailers have forgotten the importance of the shopping experience — they all look the same. Why are Apple Stores and Chicos always crowded? They care for the customer, they have quality merchandise, and the stores are packed. But many middle-level stores care, and have quality, don’t they? Of course they do, but they leave no room for customer experience. They have no uniqueness — just racks of the same merchandise and virtually the same floor plan and no level of customer experience. What’s exciting about that?

Customers know what they want. If they want an “experience” of low price, they want Wal-Mart or Target, if it’s an overall sense of experience (which often doesn’t include pricing), they they are turning away in droves from the cookie-cutter middle-level stores and stretching to someplace unique, different, fun and, well, experiential.

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3 Responses to “Mid-Size Retail in Crisis”

  1. matt Karnes says:

    What was Federated’s Chairman’s response?

  2. Matt, good question. As I recall, he was a bit dumb founded and certainly didn’t want to debate one of his customers in front of a large crowd of retailers and suppliers. He talked about changes they had made or were going to make, but it was a hollow comment as we all knew that it took more than a few changes to put some life back into the stores.

  3. JC Penney’s is especially guilty of this. This is exemplified by moving their cash registers to the middle of the aisles and turning their salespeople into cashiers. I’ve written more than 200 posts on customer service and the one that continually attracts comments is about my horrendous experience in a Penney’s store five days before Christmas.

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