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The Impact of Lazy Retailing
The start of 2020 has seen up to 170 stores earmarked for closure across Australia. The companies in question include:
With the closure and potential closure of retail stores it is beneficial for all retailers to stop and consider the “why”. In some cases, the “why” is lazy retailing. Lazy retailing is essentially using the easy way to get a sale.
Many years ago retail businesses would have two discount periods a year. In 2020, it feels like most retail businesses offer discounts all year round. The discounts are offered in order to attract customers/sales. However, consumers are now conditioned to buying at discounted prices. This means more sales need to be made in order to achieve revenue targets. We believe it is possible to operate in the retail space without discounting. Accent Group who own the brands: The Athlete’s Foot, Timberland, Dr. Martens, Merrell, Platypus, Sperry and others is the perfect example. In 2018, the CEO made a commitment to stop “lazy retailing”. This resulted in lower comparable sales but better margins and in turn more profits.
Some retail analysts believe that if you have to discount your product to achieve a sale, then your product is not worth selling. Consumers should want to buy your product at the full price.
Lazy retailing can also refer to customer service. As bricks and mortar shops face increasing online competition and increasing wage costs, the number of staff hours have been cut considerably. It’s not a pleasant consumer experience to be left stranded in the change room, needing a different size but there is no one around to help. How many times have you left the clothes hanging in the change room and walked out in frustration? Or do you take into the change room the same dress in 3 different sizes – just to be sure?
Are you ready to buy a high end product – a camera or leather jacket you have been eyeing off for a number of months – only to find it chained to the wall or hanging rack? You are prepared to spend around $1,000 but you can’t touch and feel the product or you spend your time trying to find a retail assistant to unlock the product.
Now is a good time to review your business and analyse your customer touch points – bricks and mortar and online businesses. What can you do to improve the customer experience and ensure that you have a profitable and long lasting business.