Jun 18, 2014 | Collaboration, Customers, retail, Small business
Strategyaudit.com.au
Chain stores dominate our grocery shopping environment, they have developed all the advantages of scale, and use them to the advantage of their shareholders, by delivering returns, and to customers by delivering low prices.
The model works, in Australia 75% of the grocery shopping dollar goes to one of two retailers, and small retailers have been decimated.
However, small retailers are making a comeback, the ones left are good, good enough to deliver value to their customers in different ways to the chains, and they are making a good bob.
They compete with a variety of strategies, all of which have elements of the following 10 rules.
- Make the store look warm, friendly, inviting, and, importantly, current. The last Valentines day, a client put in huge volumes of roses on which he put some very cheap prices compared to the highway robbery employed elsewhere, but he also had a promotion of Chocolates and a voucher for collaborative promotion with the grog shop two doors down, on sale. He did sell a lot of roses, a pile of chocolate, and got a slice from the bubbles the grog shop sold.
- Collaborative retailing is a really effective way of building sales and relationship s with customers. The example above worked really well, as have others that group retailers of differing women’s apparel, dresses, shoes, hairdressing services, et al together.
- Experiment, with everything under your control. Store layout, range, price, stock weight and position, proximity of complementary products, promotional activity, it is a long list limited only by imagination and energy. However, experimenting is not the only game, you need to track results, now easy via the electronic tills, and if nothing else, Excel pivot tables. Understand what works, and improve it for next time, eliminating the things that prove not to work. It is a simple formula, challenging to implement consistently, but in principal, simple. Learn as you go, and as the you experiment more, you will also find your depth of tacit knowledge also increases. A small business can put in place an experiment, have the outcomes and a resulting tactical outlook while their bigger competitors are still trying to get a meeting together to decide if it may be a good idea.
- Use technology widely, not just in the tracking of sales, but in the management of your operations, and most importantly, the engagement of your consumers. Make your website the co-ordination centre of your marketing efforts. Mobile, email, social media platforms, blog posts, all potentially have a place, but mostly you cannot do them all, so make informed choices. However, you need to recognise that digital is not free, there are both operating and opportunity costs attached, and for most SME’s, a capability gap. Outsource all you can, which is getting easier by the day, and importantly, track the results of everything you are doing on line
- Make sure you have a website that does you justice. A mate sent this to me this link to Victor Churchill, a butcher in Sydney’s eastern suburbs, and now I just want to go there.
- Personalise, personalise, personalise. The chain retailers have “mass market” business model, they cannot easily personalise their offer to the customer base. They may have a technology edge because they have the resources, but how often does the casual filling the shelves greet a customer by name? Enquire after their kids, and ask how the fruit basket you supplied last week for the centre-piece of your dinner party work out?.
- Specialise in what you do best, deliver “depth” to consumers where the mass retailers can only deliver “breadth” to a mass market.
- Be the expert in your category. If you are a produce retailer, know where the best strawberries come from, and when they will be available , similarly, a fashion retailer needs to be current with the trendsetters, to know what is coming, what will accessorise easily, and how the fashion can be tailored to the market they are serving. Most people want to deal with, and seek the affirmation of experts, be the expert, and they will keep on coming back.
- Apply the disciplines of Category Management to your inventory and space management. In its simplest form, Category Management is a mindset that seeks to allocate finite and valuable shelf space on the basis of maximising the customer experience, while delivering optimised profitability and long term commercial sustainability. This can get as complicated as you like, but for an SME, building an excel database leveraging the capability of pivot tables, tools virtually every business has sitting on their PC already, is sufficient to get started.
- Watch the cash. This one always gets a run. Retailers greatest cost, and biggest risk is usually inventory, and inventory is a raging consumer of cash. On the other hand, the oldest adage in retailing is “stock sells stock”, so there is a tightrope to be walked. Perhaps the most valuable, and in SME’s underused, performance measure in retailing is stock turn. Use it aggressively to fine tune your range, and inventory.
None of these “rules” are of great value separately, but together, they offer a potent competitive tool set for small retailers.
Jun 6, 2014 | Communication, Small business
Marketing is about telling stories, engaging people with them, which builds awareness, affinity, preference, and with luck, persistence, and good management, can lead to a transaction, or two.
Metaphors, when well used can make a complicated point in a memorable and understandable way.
Couple of weeks ago in a talk to a small group of SME owners about the rugged terrain of modern marketing, I used an old metaphor, a throwaway, in the midst of the conversation. I was surprised firstly that nobody had heard it before, and secondly at the sudden clarity it delivered to a complex message.
“When you go to the hardware to buy a 10mm drill” I said, “you do not really want a 10mm drill, what you want is a 10mm hole”.
An oldie but a goodie.
This morning on the copyblogger site I saw another one I really like. It goes something like: “To make a restaurant successful, you don’t really need the best location, best service, lowest prices, fascinating menus, and all the rest, you just need a starving crowd”.
Obviously, all the good features you will see touted around as people flog bum-spots in restaurants in a crowded market all helps. They are part of the means to the end, the way you deliver the service, but to be outrageously successful, what you really need is a starving crowd.
A good metaphor, like a good picture, clarifies, simplifies, amplifies, and makes memorable, the outcome of a complex conversation.
May 28, 2014 | Alliance management, Collaboration, Leadership, Small business
Mojowire.net.au
Tonight is the first Origin game of 2014, and so I expect to hear lots of people using sporting analogies over the next few weeks, particularly football.
Sporting analogies abound in business, “A team of champions does not make a champion team”
How many time have you heard that?
As management layers are removed, and the management culture evolves rapidly towards recognising the value of teams in a commercial context, we often use the sporting team as the foundation of the commercial team .
Familiarity, known skills, interpersonal relationships, all that stuff gets considered as a team is put together. Sometimes of course, in the real world teams are put together with whoever is to hand, has some spare time, is at the water cooler too often.
We confuse this simplified sporting stuff, useful in its own context, with the key components of a commercial team faced with commercial challenges.
In that case, you need a range of technical and domain skills, a questioning mentality, and a willingness to try things, and usually some diversity, some new or unusual blood being injected to create a sense of discomfort that always precedes game changing ideas and insights.
Unlike sporting events, which last for a hour, more or less, commercial challenges are way longer term, when the micro interaction is important more as a learning event than a game breaker.
May 22, 2014 | Change, Governance, Marketing, Small business
The future prediction business has so far failed to find a sustainable business model, apart from the fun stuff in the tent with the funny lady with the cards and crystal ball.
About the only serious people who still profess to be able to predict the future with any accuracy are politicians, and we all know how that usually turns out. The rest of us set about controlling what we can control, and preparing for the unexpected from the things we cannot.
By contrast, with some effort, staying on the leading edge is possible for all enterprises. Information is now so freely available, and consulting services whose stock in trade is “leading edge” whatever you want, so ubiquitous, you can stay in front of most if not all of your competition, and be aware of changes occurring so you are in the best position to leverage them.
Small and medium sized companies are best placed in this game of staying current, should they be prepared to make the commitment to do so.
Smaller companies can try stuff out, see if it adds value, and deploy in the time that their larger competitors take to organise the conference call to test if there may be a good idea in here somewhere. The only hurdle is that it does consume scarce resources, but when you see that consumption as an investment, the payoff can be huge.
In the marketing space, my hometown, the cost of testing has fallen so dramatically over the last decade that there is no longer any valid excuse not to be testing extensively.
So get on with it, apart from being strategically and competitively sensible, being at the front is where the fun is.
May 20, 2014 | Change, Communication, Leadership, Marketing, Small business
“Serendipity” . Luck that takes the form of finding valuable or pleasant things that are not looked for. Websters Dictionary.
My old Dad used to say “Son, the harder I work, the luckier I get” and it has usually worked out that way.
It follows then that if you combine the definition of Serendipity and Dads old chestnut, Serendipity can be managed.
How you ask!
- Recognise that Serendipity is a state of mind rather than a quantitative outcome, and should be managed that way.
- It requires a management culture that has everyone working together, “alignment of strategy and activity” as a popular management article would probably purr. A utopian notion, but doable.
- Ensure there is “spare” time allocated to staff to pursue ideas, contribute to collaborative activities, and look for improvements. Personnel whose performance measures are quantitative box ticking exercises are unlikely to risk compromising their KPI’s by allocating time to potentially serendipitous pursuits.
- Provide the forums for casual and social interaction. This can be done in all sorts of ways from the way the offices are designed to organising staff picnics.
- Encourage the behaviours you are seeking by publicly recognising it when it happens. Financial and organisational rewards are of little value, but is the social rewards that really count.
- Trust and respect are critical components of productive collaboration. Neither can allocated, both need to be earned. “Ideo“, the creative agency has it nailed, one of their core values is “Make others successful”. When everyone works to make others successful, trust and respect follow, and the culture tends to expel anyone who does not work with that culture and its behaviours.
The great benefit if success in these endeavours is that it will make your place a great place to work, and that ends up attracting the best talent, attracting interesting, challenging and rewarding customers, and making good money. A virtuous circle.
That’s how.
May 19, 2014 | Branding, Communication, Marketing, Small business
Imagehaven, Innovation by design
On several occasions last week I found myself frustrated that I could not find a piece of information I needed on a website, I knew it had to be there somewhere, it is just that someone had effectively if inadvertently hidden it. GGGRRRRR
Over the years I have asked many people, individually and in audiences, what for them constitutes the perfect website.
There have been many answers, but there are always three that recur almost every time:
- Simple, clear, and quick to navigate.
- The information needed is on the site.
- We know what to do next.
How easy is that?, yet how often do we find ourselves searching a site, getting frustrated before we move onto the next likely one in the search list.
Usually it appears that the confusion and clutter comes from a few common sources. Designers try and put all the information up front, rather than creating a hierarchy of information that reflects the way people search, they let their “designer” genes run riot with the result that there is simply too much “design”, or that the original design has been added to over time like a house that goes through a series of renovations and extensions and ends up just being a collection of rooms.
It is really just a question of thought being put into the design. The combination of white space, written information, graphics, and calls to action (CTA). There are many “rules” of design around, this article by Zoe Sadokierski from UTS offers some of the perspective of history, that can be usefully applied to website design, but a bit of common sense goes a long way.
Next time you set out to design a site, consider these three simple rules, or you could just call the gurus at Imagehaven.
