Why retail matters

When people in our industry think of retail, they often do it holding their nose. Everyone wants to work on brand advertising, and why not? Brand ads are big and sexy, a lot of money gets splashed around and there are awards to be won. Who can forget the Qantas brand commercials with mass choirs singing from clifftops and across the Simpson Desert? And who knows? You might even meet the celebrity brand ambassador who’s pocketing a fortune pretending to use your product. 

“Retail? Errgh! That’s Best and Less, and JB Hi-Fi! Crude, loud and ugly. No thanks”.  

But when you think about it, it’s in the retail space, either on-premises or online, where we all get paid. And not every retailer is some dude doing his own ads, wearing a chicken suit and screaming at the camera about how CRAZY he’s suddenly gone. Perhaps it’s just me, but I can’t see myself buying a gas heater from someone who’s just declared himself insane. The safety implications alone are obvious. 

My point here is that not all retail is noisy and obnoxious. Remember, a BMW dealership is a retailer too. 

The fact of the matter is, all the brand ads and product launches and stock market forecasts are all meaningless if no-one buys the stuff. “Brand Value” can be a slippery and esoteric term – the whole world may know your name, but you can’t put that in the bank. In practical terms, the “value” of your brand contributes to the confidence customers will have in your product, and therefore the likely uptake of it. It’s also literally the price for which you would sell your enterprise to another in a corporate acquisition, but if you had to do that, the assumption would be that your enterprise is already on the wane, or is vulnerable to an aggressive takeover.  

Stock market valuation is also a poor measure of actual viability. Shares change hands on the potential earning power of a brand – the changeable amount of dividend you receive at the AGM. And that still depends on the product actually being sold in decent numbers.  

Certainly, just trading shares can earn you some investment wins, but ultimately the product still has to sell for any revenue to shared. And stockbrokers are skittish creatures. Like a herd of gazelle, if one starts running, they all do, and your brand’s share price may hit the floor just because someone started selling your stocks without warning.  

Back to brand ads. Without a doubt, they certainly have their place. When done right they establish your brand at top of mind in the market, and give your customers comfort and confidence in whatever you produce. These are the ads with beautiful young people having a surf, or driving through a verdant forest, then flopping down on the beach at sunset and having a beer/soft drink/wine with your label on it, or using your mobile phone brand, or wearing your clothing. 

Then come product specific ads. This is where a brand launches, or reinforces, particular products in their range. Now it’s not just Hyundai, it’s the Hyundai Santa Fe hybrid (and no, I’m not getting paid for endorsements, but I’m more than happy to. All bribes considered.) These ads will explain the singular benefits of this model, and if you trust the brand, like the features and need a new car, then you’ll start to research where you can get the best deal on this, or an equivalent competitor vehicle. 

The three big questions. Why buy THIS? Why buy HERE? Why buy NOW? 

These are the questions to which every retailer needs to have an answer for a successful sale to proceed. The “why buy this” should mostly have been covered by the manufacturer’s own brand and product marketing. The brand is established, the product has been launched globally, not just with marketing but also with industry media coverage, and customers now need to decide where to purchase. 

The retailer shouldn’t spend valuable attention time retelling the story of the product. Don’t lead with “Brand New from Samsung!” - your customer will already be well aware that Samsung has a new phone on the market if they’re looking to upgrade. 

Likewise, don’t bombard the customer with mystifying detail about the products’ features. I once had a telco client whose product specialists gave us copy including things like “20 Mbps network speeds”. While technically spot-on, it's another language to the average consumer. What it means is “download 20 songs in a minute” (in the days before music streaming), or “watch uninterrupted TV on your mobile”. Remember, the benefit of any product is not what it is, it’s what it does.  

Why buy here?  

Unless you have exclusive sale rights to a product, you and everyone else are selling the same latest hot item, at more or less the same price. Some manufacturers even try to prohibit their various retail channels from discounting their products.  

So, what does the retailer do? Adding an extra year's store warranty is not a discount but a value add, as is a free laptop case or a $20 gift card. Just a little sweetener to entice the customer to you. And if you’re a customer buying something, don’t be afraid to ask for extra. Retailers will give away a little to gain a lot. 

Why buy now? 

At any given time, people have multiple purchases they want to make, and will prioritise appropriately when they have the money. Now say this with me: “Everyone is your competitor on payday!”. Now say it again. 

Retailers often think that are only competing with other retailers in their product or service category. But if you’re selling a Bluetooth speaker, you have more to worry about than other dealers who sell Bluetooth speakers. The customer considering buying a Bluetooth speaker, is also considering a new video game, or a fishing rod, or a new pair of jeans. You must therefore make the case that your speaker must take immediate priority over those other desires and that the customer must act now for the best deal. 

Therefore, put a time or stock limit on a discount or value add. "While stocks last","Offer ends April 15". If you’re the only one giving a little extra, give customers a compelling reason not to delay, and the fishing rod will just have to wait until next payday.  

Good luck!