Growing your business
Retail Champion Clare Bailey: How to Find Success on the Developing High-Street
High-streets run through the heart of communities in the UK. Whether in busy cities, quiet villages, along our seafronts or lining our parks. They’re a local asset that can add convenience and charm to any community, but the business owners that make up your average high street face some high profile challenges.
Retail competition from elsewhere is high. Sales online in the UK have increased by 15% in the last year, accounting for approximately 16% of all retail spending. New retail parks and superstores are also multiplying, and high business rates and parking charges aren’t making the case for the high-street any easier.
Wondering how our high streets will evolve in this fast-paced, digital climate, we spoke to retail expert Clare Bailey, founder of The Retail Champion and author of The Retail Champion: 10 Steps to Retail Success, to gain some insight on high-street perks, pressures, and predictions for the future.
Keeping Up With Technology
I believe it is essential for all businesses - no matter how small - to take advantage of the opportunities presented by technology. For a start, using EPOS systems – electronic point of sale systems, embedded in your till - can simplify many business processes; the data they provide can inform and support so many critical business decisions! Without that information, business owners could be missing out on key opportunities, or not nipping issues in the bud before they become significant.
Reports from a good EPOS system can provide business owners with key performance indicators on metrics such as sales, stock levels, margins, sell through rates, promotional uplifts; as well as being used to analyse things like seasonality and other indicators that are essential to future range decisions and buying plans.
Additionally, CRM (customer relationship management) software – which is often an add-on to EPOS systems – can enable retailers to deliver loyalty schemes, and help them to engage with existing customers, share news updates about product launches, events, and special offers. Always making sure they’re not forgotten by their customers!
Technology is also an essential part of sales and marketing. Whether that be engaging with potential and existing customers through social media, promoting products through pay-per-click and sponsored listings, selling through online marketplaces, or by having simple e-commerce on your website that means the shop is “always open”. The customer benefits that technology can enable, are now expected by the modern consumer.
However, if the customer also expects a more traditional, personal level of service, that ought not to be compromised. Great service and great technology can coexist and be highly complementary. Using technology can increase your productivity, freeing up time to invest in a better face-to-face and in-store customer experience.
So technology is, undoubtedly, a win-win and something that should be embraced, not avoided.
Facing The Competition
One of my mantras with my clients, and something I encourage repeatedly in my book is: “don’t compete on price, compete on service” – and by “service”, I mean the whole experience.
Small retailers often know their customer personally, so they can go the extra mile with service delivery as they do genuinely care. Sometimes it is worth reminding customers of the merit of shopping with smaller businesses in this way; especially as it is often merely habit that causes people to shop with the same old big brands.
Don’t feel shy to remind them that by shopping with smaller independents they can be helping a business owner to raise a family, pay their bills, employ local staff, and support smaller, up-and-coming UK-based product suppliers for instance. Messages like this can make them feel a more emotional connection to the business, resulting in increased loyalty.
From my experience, there’s no point in smaller retailers trying to go head to head with the big players, so their best bet is to focus on standing out from the crowd instead. This means stocking brands that are not available elsewhere; showcasing innovative, exciting and unique products; and overall, becoming an absolute go-to expert for your chosen retail category / proposition. Through unrivalled knowledge, exceptional service and product range, smaller retailers can carve out an attractive niche for themselves.
What To Avoid
Don’t make the mistake of devaluing your brand. All too often the smaller retailers undervalue their proposition. No customer expects to receive an impeccable level of service and a fantastic product, and to pay next to nothing for it! Remember the strapline of Stella Artois? “Reassuringly Expensive”! If something looks too good to be true it can actually make people feel suspicious, so you need to charge a premium price if you’re going to offer a premium proposition.
If you want to attract the kind of customers who value what independent businesses have to offer, who care for a high-quality experience, and appreciate the role smaller businesses play in the local economy, then it is unlikely that they will be as price sensitive as you think!
And don’t attempt to price match the major competition; it’s a is a race to the bottom in which only those with the deepest pockets, and with the greatest buying power, can survive.
When it comes to engaging customers, less is more. If you are rushed off your feet with low-profit customers you’ll not have time to invest in those who would be worth more if only you’d been able to focus on them. If you have fewer, highly profitable customers then you can invest your energy in securing their long-term loyalty.
It’s almost impossible to predict what will happen; even in the next 12 months! All I can say is that those retailers who maintain an obsessive focus on the customer - whilst also having the same obsession about reducing costs and increasing efficiency – they’re the ones who will have the strongest and brightest future. Those who rest on their laurels and don’t recognise the need for constant re-evaluation of both what the customer wants and how they go about delivering it in the most profitable manner, they will suffer.
It is inevitable that there will be more churn on the high street. Unsustainable businesses will fail. In some cases, new businesses will fill their void; and in other cases, town centre management strategies will be adopted to deal with rising vacancy rates and the changing dynamic of how people utilise places like high streets.
At the end of the day, customers vote with their feet and with their wallets. But with costs rising and margins squeezed, only those retailers who manage their businesses exceptionally well can expect to succeed.