I love disruptive technology and looking at markets and how they mature and change the way we do things that we previously thought were simple. Recently, I came across an interesting quote that really made me think about the state of retail and what we are seeing in the world today. The quote, which was about how to really become profitable these days, was something along the lines of, “To create a new game, you don’t need the courage to come up with a radical new idea, you just need the courage to change the way the old game is played.” What did Uber do, for example? They didn’t exactly come up with a new paradigm for giving rides—it wasn’t rocket science to make it easy for someone with a car to offer a lift to someone who needs it. What they really did was change the way the taxi industry had defined the rules, and they had the courage to litigate with cities that tried to call them a taxi service.
Retailers that have a brick-and-mortar store are worried about how to compete with Amazon and other large e-commerce retail sites. My advice? Stop worrying. Do to them what they did to you: change the way the game is played. Once you look at it that way, I think it’s actually quite easy to beat Amazon and Wayfair because, ultimately, these large-scale retailers can never do what you can do, and that is: engage with the client. Now, I’m not saying you are going to knock Amazon over. But I am saying that you can use the relationships that you can build with your customers to your advantage: sell awesome stuff, create great experiences that customers will talk about that will lead to better keyword rankings, and allow yourself to not get destroyed by them. It’s not going to be easy, though. While I can give you what will sound like five easy steps, there is a fair amount of work that you will need to do. I’m not talking about hard, sweating, gruelling work either. I mean the roll-your-sleeves-up-and-really-get-deep-into-your-business kind of work.
Let’s start with something you are going to need to do that I believe most of the retailers I have talked with so far are fundamentally failing to do: mapping out your customer journey. I don’t mean the Excel spreadsheet kind of approach. I mean really get into it—roll up your sleeves and understand what is going through the mind of your customer. Like, what are they doing two or three days before they come to your website? After they decide to come to your store, what are they talking about in the car on the way there? What are they looking forward to—or not? What are they doing while in your store? If you don’t know this customer journey really well, then you have lost to Amazon already because, ultimately, Amazon is offering the customer convenience. I can get most of what I want, including products recommended for me, delivered right to my door by completing a one-click transaction. Who wouldn’t want that? Only someone who hasn’t properly gone through a customer journey. If that is lacking, I may as well just sit at home and order what I think I need from Amazon and wait a couple of days for it to arrive.
But human beings actually like to be out and doing. Shopping is an opportunity for social interaction and we crave that. We crave that surprise and delight that comes with finding something unexpected and being treated like our business matters. And we always will. So, if you are a merchant, you need to be aware there has been a radical change since the days when all a retailer needed to have was a nice store with nice products. Today, the customer wants an experience and, if you give them that, those customers are hooked. In fact, there are great brands that have grown quickly with a strong brick-and-mortar play. Brands that have invested in the customer experience and done it right will, on average, see a 38% increase in revenue in less than 12 months. Stop and think about that—even if you don’t believe me and cut this proven, bona fide statistic in half. What I am telling you is that today, as we roll into March, you have the ability to increase your 2018 Christmas season by at least 19% over 2017 if you start to change your customer journey now.
So, let’s get into it and start to look at what you can do.
1. Narrow your niche!
The strength of large-scale e-commerce retailers is that they have the proverbial endless aisle. They can sell everything and do it efficiently but, as we know, you can’t be good at everything—it’s impossible even if you wanted to. So, you have to narrow your niche and focus on what you do sell. Don’t focus on “everything”; focus on those few things that you do sell—and sell better than anyone else on the planet—in a way the customer finds intriguing. In most cases, the customer will start their journey (in some form or another) on your website, so it’s extremely important to narrow your e-commerce niche and dominate as best you can. How? Through content marketing; specifically, content marketing that is targeted at individuals and that has been developed by having a better understanding of the profile of your website visitors. Think: When was the last time you received a custom-designed email campaign from Amazon that they did particularly well? It just doesn’t happen. Why? Because it’s impossible for Amazon to do content marketing. So, bam! You have an amazing opportunity to start to get to know your customer by personalizing the interaction with them so you can really get into your niche and rank for all kinds of the required keywords.
2. Do something radical and inventive with shipping!
Quite honestly, if I were the CEO of a retailing company, one of the first phone calls I would make would be to a company like Uber to ask how we could develop a partnership. Are you worried about a customer who comes into your store and checks out a product they weren’t sure about, just so they can order it from Amazon on their mobile phone as soon as they walk out the door? If you are, I’m going right back to customer journey. If this behavior worries you, it’s because you are missing the boat on a great opportunity to create an engagement with the customer and give them a surprise. Can you imagine what would happen if you showed up at, say, a Cirque du Soleil show and they said, “Sorry, we don’t have that act here, but it might be at our other circus location—you should go there and check”? Of course not! Does your customer typically have a busy day? Then how about sending that product to them in less than two days. How about having a local delivery service find the product for them, which they then send to the customer’s house for delivery later that same day. My point here isn’t to get into a debate about profitability and the ability to do this—I get that. My point is, can you look at shipping as a way to do something inventive and unexpected for the customer? Whatever you decide to do will depend on what type of customer experience and customer journey you want to create and, like I said before, you need to do that work. What expectation do you want to set, and how can you deliver a surprise to the customer?
3. Create a subscription
A subscription service is one of the smartest ways to sell a product because you don’t just get a one-and-done transactional experience with your customer. Instead, you get a relationship, and revenue every month or year. You don’t have to be a software provider to make the subscription model work; any form of recurring deliverable warrants recurring payments. To really get to know your customers, you need to look for every possible excuse to have an interaction with them, and a subscription can do that for you. Are you a grocery merchant worried about Amazon’s acquisition of Whole Foods? First of all, don’t be—unless, of course, you don’t have the courage to change the way the game is played. In that case, you should be afraid, because the Whole Foods acquisition probably had a lot to do with data. Amazon desperately needs to understand who their customer is. Remember, they don’t have any form of content marketing and they sell everything, so it’s impossible for them to personalize and engage. The only way they can feed their recommendation engines is to make them smarter, and looking at what I am eating, and how frequently, can actually drive a lot of big-data algorithms to select products that I am likely to be interested in. So, change the game: instead of one-and-done, figure out how you can turn your data engine on and learn more about your customer.
4. Boast that you have the best customer service on the planet and then raise that level every year
It might sound like I am somehow against Amazon but, actually, I’m not—what they have done is amazing. In all honesty, if there were a book that tells us what’s coming for retail and reveals how we will buy things in the future, then I would argue that we are only at chapter 1 or 2 of the first volume in a series called e-commerce. In other words, there are things to come that we haven’t even begun to contemplate yet. So, I mean no disrespect to Amazon, but they can’t do customer service the way you can, because they are too big. Amazon is never going to offer personalized one-on-one service (well, it’s unlikely) with one human talking to another human to help them create and feel good about a transaction. Therefore, Amazon is unlikely to achieve a virtual standing ovation from a passionate brand evangelist that goes viral. On the other hand, WestJet posts videos around Christmastime every year about how they are doing really cool and amazing stuff for families that are flying over the holidays, and it always results in exactly that type of passionate brand evangelism. Imagine that: What do you think of when you think airline travel? I travel a lot and experience a lot of airlines, and I can say that I am seldom thinking “This is going to be AH-MAY-ZING!” What a surprise if it actually were.
Think about the last time you had a great buying experience. It likely had to do with a human being who helped you out. That’s why you are never going to hear chatter about the great buying experience they had on Amazon—there is no one you can actually talk to at Amazon, even if you wanted to.
Simply put, customer service involves personal interaction with, and relationships with, your customers; don’t make it any more complicated than that. All you need to do is provide personal care and be nice about it. I mentioned before that when brands invest in the customer journey, they can make the experience something that gets an average 38% return in less than 12 months. Customer service is where you are going to win, and how you will be remembered. Invest in those relationships, because that investment will serve you well.
5. Build a fanatical fan base
This last step is probably the biggest one. Think of your brick-and-mortar location as an opportunity to “perform.” Change the rules and make that performance intriguing, and you will have a loyal fan base. Something that I really want you to think about, as well, is how you can create a new lexicon for what you sell. Do you think I might be wrong? “I’ll have a triple grande mochaccino—no whip.” If I had turned to you 15 years ago and said that, you would have looked at me like I had three heads. Yet, Starbucks transformed the coffee shop into a place where a teleworker can get out of their home and come and work, spend $5 to $7 on a cup of coffee, and connect with a loyalty engine and a fanatical fan base that loves the same product. Fans who engage. Starbucks changed the way you order a coffee, changed the way your coffee is made (right in front of you), changed the way you get a coffee—complete with your own name on it—and they changed the way you enjoy the coffee, if you stay there to finish it. They changed nothing about coffee and lattes; they changed the way the game is played. Engage, engage, engage. I would say that Starbucks is now one of the best omni-channel retailers out there, enabling me to shop in the store for a coffee using my mobile phone as easily as walking up to a barista and ordering one.
I cannot stress this enough. You have to figure out that customer journey, and I mean really figure it out. Push deeper. If you think you already have a customer journey laid out, let me tell you, you haven’t gone deep enough and you haven’t looked at a single user profile enough to really know your customer. Don’t be ashamed or alarmed; most retailers haven’t—how could they? Most retailers I’ve talked to don’t have much more than a first and last name and an email address in their CRM or loyalty system. Without data, you can’t know who your customer is. I would hate to be a retailer who has jeans for men and women and needs to send an email out to Pat Smith and their sibling, Robin. Don’t send them a promotion for the wrong jeans, or neither is coming back!
Yes, I am aware there are some serious issues plaguing retailers, and it is likely Amazon that caused them. But stop, take a breath, and realize that your business has to change and that you need to look at your business as an opportunity to engage and develop strong personalized relationships and experiences with your customer. The retailers that do this will succeed and actually see their business grow. I am passionate about helping to make that happen, as I think there is a real opportunity here to ride a disruption wave. Seize it—map it out—and be successful.