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I used to say that having the right merchandise, at the right price, and having the right people who know how to sell it, is the winning formula for retailing success.  I never believed that the location of the business was as important as long as it was somewhat accessible to people. But I think I am changing my opinion. Let me explain why I said that.  Customers go to businesses because they can get what they want. They go because a store makes a market in a particular type of product or specialty. We don’t go back to stores that don’t have what we want.

Online stores are beating the brick and mortar retailer in the area of selection, or at least the perception of selection. I bought a TV online; the store had a much bigger selection online than it could ever carry in a store. In short, they had access to the inventory in a relatively short time to satisfy the order. As for pricing, most online stores are also competitively priced and as for the issue of shipping costs, I believe all online stores will eventually be free of shipping costs. Isn’t that the way it should be? They don’t have to have pretty stores in high rent districts.

So what is the future of the brick and mortar retailer? I believe it’s better than ever, providing we understand some new rules of retailing:

1.  Understand that just about anything we sell can be purchased online.
2.  We must develop our own brand or signature collection of merchandise.  You don’t have to start manufacturing anything, buy just select interesting unbranded products to call your own.
3.  Retailers today must be multi-channeled, which means we must embrace ecommerce and start to derive revenue from it.
4.  Realize that shopping is now a sport and an activity. We have changed it from a necessity to a leisure time activity. (Of course grocery shopping is still a necessity)
5.  We are now in the experience and entertainment business.

This isn’t really new. We have been to stores for years because we would know all of the people, we would have a few laughs and buy something. That concept is even more important today than ever before. We have to focus on the customer’s experience as much as possible. We also have to entertain them and educate them.

We are living in an entertainment based society where high premiums are placed on entertainment. I love the words “where high premiums are placed” because it means extra margins. It’s not about selling the merchandise; it’s about selling  the experience. That’s why loyalty is dying. We have become experience junkies.

We must have an event schedule of different things going on in the store from classes to trunk shows, to book signings, to parties, sales, and those off the wall promotions like celebrating Elvis Presley’s Birthday. But it’s even more than that. It’s the way we answer the phone; it’s the look and feel of our website; and even the people we employee and how they are dressed.

I am beginning to believe the term customer should be replaced with “guest”. Although after 35 years of calling people customers, it might be hard but I think you get my point. This doesn’t mean you have to redecorate your store tomorrow. On the contrary, there will be stores that will be able to get away just the way they are if the owner or manager makes shopping experience a blast. Maybe what I am saying is now is the time to realize that we must make the mundane memorable.  Have a great week and make it fun.