The retail apocalypse

 

  • Retailers should pay their employees more than the minimum wage.
  • The customers who buy your products or engage your services will never be well satisfied if the people who sell or deliver your products or services are not themselves well satisfied.
  • It’s easier to purchase products online as eCommerce sites have followed Amazon’s model of “one-click” purchase.
  • Finding qualified retail help is becoming a bigger problem.

Shopping at Whole Foods last week I was taken back by the helpful people in the store.  When I was shopping for beer an employee asked me what kind of beer I was looking for and quickly recommended two brands.  In the bakery another employee recommended some great deserts that weren’t too big on calories and while checking out the cashier went out of his way to get me the Amazon Prime discount.  Unfortunately, Whole Foods is an exception.

Brands spend billions of dollars to appeal to consumers, but if the promise isn’t being upheld at retail all those marketing dollars are wasted.   Advertising a frozen pizza won’t work if stock at the grocers has freezer burn.

What retailers are quickly learning is that in order to retain talented people who care about  customers they have to pay them more than minimum wage.  If you get people who are only there, for a paycheck, you’re going to get people who don’t care and your sales are going to suffer.

Then there is the problem of just finding retail help.  Almost every retailer that I visit is looking for help.  Here in Naples some retailers have had to postpone new store openings because they can’t find qualified help.  With the unemployment rate so low it’s only going to get harder to find good sales people.

How Online Shopping Makes Suckers of Us All (The Atlantic)

The right price—the one that will extract the most profit from consumers’ wallets—has become the fixation of a large and growing number of quantitative types, many of them economists who have left academia for Silicon Valley. [inlinetweet prefix=”” tweeter=”” suffix=””]Our ability to know the price of anything, anytime, anywhere, has given us, the consumers, so much power that retailers—in a desperate effort to regain the upper hand, or at least avoid extinction—are now staring back through the screen. [/inlinetweet]

The immense data trail you leave behind whenever you place something in your online shopping cart or swipe your rewards card at a store register, top economists and data scientists capable of turning this information into useful price strategies, and what one tech economist calls “the ability to experiment on a scale that’s unparalleled in the history of economics.

Grocers have recognized this for decades, which is why they keep the price of eggs and milk consistently low, making their profits on other goods whose markups we don’t notice as easily.

Then there is the “one-click” order.  With a simple click of a button consumers can ensure an endless supply of packages at their door from online retailers.  It’s gotten to the point that some people are getting a huge surprise when their credit card bill arrives in the mail at the end of the month.

I believe that eCommerce sales will eventually plateau as both retailers adapt their stores to better engage customers and people miss the experience of going to some retailers.  For retailers, it’s time to update their stores, train people and pay better wages.  If they don’t, they are surely facing a retail apocalypse.

About richmeyer

Rich is a passionate marketer who is able to quickly understand what turns a prospect into a customer. He challenges the status quo and always asks "what can we do better"? He knows how to take analytics and turn them into opportunities and he is a great communicator.

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