Skip to main content

Understand your retail offer through the words of others

People jump to conclusions often with little evidence to back up their decisions, Daniel Kahneman observes in his book Thinking Fast and Slow.
“For some of our most important beliefs we have no evidence at all, except that people we love and trust hold these beliefs,” he writes.
Independent retailers must bear this in mind as they read national newspapers. Expect to see all sorts of self-interested story-telling dressed up as truth. Some of this will damage your business.
For example, discount retailers are now in fashion. “The more consumers are led to focus on price, the more we benefit,” Roman Heini, joint managing director of Aldi UK told the FT this week. Is it true? I don’t know. You have to make your mind up.
Worse. Greens newsagents in the heart of Mayfair has shut its doors. After nearly 20 years of buying his newspapers and magazines there, Tyler Brûlé, the FT’s Fast Lane columnist was forced to shop elsewhere.

“This small drama on Marylebone High Street represents just one example of a huge trend – what we might call ‘the other face’ of the UK high street crisis,” writes Brûlé. “The issue of essential independent stores being lost from many gentrifying neighbourhoods. Typically they are replaced with upscale outlets [that] offer little in the way of creating any sense of community.”

Newsagents are important, says Brûlé, who is also the publisher of Monocle, because they tend to offer shelf space to new publishing ventures that chains often avoid. While you may like his argument and call to landlords to be nice to independent retailers instead of seeking to increase the value of their buildings through deals with famous national chains, you will be better off getting your business model right.

Finally, the Guardian challenged shopper Juliet Stott to ditch Ocado and try out three alternatives: Lidl, Tesco and “local stores”. Lidl cost £137 for 126 items. Tesco £136 for 127 items. In each shop she opted for own label or Everyday Value items.

“Swapping to unknown brands and changing our buying habits saved us as much as 58% off our weekly shop, which was much more than I expected,” she says.

The deals to be had by shopping around mean I will become a much more selective shopper, she says. The savings are attractive.

But what about in week three? “Shopping in my local market town just north of York was just as I had expected. It was expensive and time consuming. There were fewer own-brand products, which meant I had to pay more for the leading brands or for the privilege of shopping locally,” she said.

How much did she spend? £74.05. Why so low? Stott “purposefully restricted what I bought to keep the cost down”.
It is the worst experiment that you could ever see.

“The greengrocer-cum-deli was a gorgeous place but some items were almost double the price of supermarkets,” writes Stott. “A small brown loaf was £1.15. It may have been freshly baked and much better quality but it was half the size…” I think I can see the bias in this comparison.

Every day, you will face similar prejudice to some extent from many of the shoppers who use your shop. On top of great systems and prices, your shop needs to tell a great story that shoppers can buy into. If you tell it right, they will believe you.

Comments

Popular posts from this blog

Three secrets of great merchandising

Look at the ceiling and top wall of this McDonalds restaurant. There is a picture of two good looking healthy people having fun and some bright primary colours. Ask yourself what is the purpose of this picture? In the latest issue of Retail Newsagent in a feature on merchandising, Andrew Knight of RI tells its independent readers that they need to think about using sharp pictures of non-packaged products linked to people consuming goods. Perhaps this has been taken to the next level by the fast food chain - that is selling the feeling of being happy and healthy rather than the products. A second, related tip from the same feature is made by most contributors - it is vital to keep windows clean and clear of clutter. "I believe that less is more," says Roli Ranger, a retailer from Ascot, Berkshire. He has posters for promotions in between the windows that are regularly updated and discreet signs in the windows. Third, a highly visible well-stocked promotion at the entranc...

Busy street, empty shop, missed profits

True in part to my New Year resolution, I held a business meeting in an independent coffee shop today just next door to a Starbucks. The cafe was presented well and four staff were busy preparing for the lunchtime rush, at 11am. As my guests were late, I had a half hour overview of footfall on the street outside and in the restaurant. Six customers. Barely enough to form the queue in Starbucks or Pret-a-Manger just down the road. Plus one Italian girl who dropped off her CV. Some people stopped to look at the posters in the window and moved on. The owners seemed quite happy. When I left just after 1215, they were doing brisk trade. However, I have the impression that the business is not working hard enough. It could easily have managed 120 customers between 11 and 12, instead of 12. This is lost profit as the fixed overheads and staff costs are already in place. The owners are clearly busy - perhaps too busy to take time to look at the potential that their cafe has. What shou...

Sticks and stones do hurt

My 17 year-old son returned from a rock festival this week wearing a wristband proudly declaring him 0ver 18. He explained how easy it had been to use someone else's ID to get the identification and said it was ironic that he had not needed to show the over 18 band when buying alcohol. Today, Scottish retailer Abdul Qadar is complaining that public authorities are asking people to lie about their age when making test purchases. What trading standards officers may be forgetting is that the fact that retailers invest in a business premises and trade consistently from it make their job much, much easier. The alternative, a world of markets and itinerant traders, will be far harder to police. Mr Qadar's sense of injustice is fair. Those retailers, like Mr Qadar, who value their investment will seek to trade legally and will not sell alcohol to people under the age of 18. Asking children to lie about their age to local traders is a slander on all retailers.