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Retail SMART |
Don't
Survive, Thrive! |
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By:
Dennis A. Conforto
Chairman & CEO of A-Z Media Group, Inc. |
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In my series of articles on the retail grind, of the ten ways you knew you were no longer in the retail grind, the last was
"when you feel that your business it not just surviving but rather thriving."
Most of our research indicates that the average scrapbooking retailer is just surviving from month to month. There are, however,
some bright spots: there are a few who are truly thriving in their businesses.
Those who are thriving don’t think that the "surviving" stores have much of an impact on their business. Nothing could be further from the truth. A weakened industry affects everyone, mostly the consumer, who can
lose confidence in an industry.
Today, to be a good scrapbooking retailer, you need to be good at everything: accounting, merchandising, store operations, pricing, advertising, purchasing, displays, packaging, reordering, and security. It’s hard work, but if it’s done right, the rewards are great... just ask the members of Sam Walton’s family about the rewards for getting it done right.
A thriving business is always growing, changing, and adding additional storefront locations, because the business model they have created works. They figured out how to train, motivate and inspire their employees and customers alike. They are growing
both their average transaction, and their customer base. They are converting new consumers to be scrapbookers and they have figured out how to create a loyal community of women.
At the end of the day, the independent retailer is the one who is in the best position to create the community of scrapbookers. This is something that the big box retailer can never take the time to do.
To thrive today, the independent retailer must own three of the four consumer categories. The four categories of scrapbookers are:
1. The expert level
2. The intermediate level
3. The beginner stage
4. The fringe market
The independent retailer must own the expert, intermediate and beginner levels. The fringe market belongs, for the most part, to the mass merchandiser. And you should be happy to let them have it; there is not much profit to it, nor is there loyalty by that customer base.
The first job of the independent retailer in today’s market is to convert the fringe customer into your store’s scrapbooking community. The second job: take these same consumers through the cycle of beginner to expert.
How do I convert them?
Well, first do the other nine steps that I talked about. Then honor all coupons offered by the mass merchandisers. This allows you to earn and keep a customer through
their whole consumer life cycle.
Why is conversion and life cycle retention important to my business? The average consumer who gets into crafts and goes through those consumer life cycles
is normally devoted to it for about 6 to 7 years. After this 7 years, there is a noticeable decrease in both the time and money they spend in the craft. For this reason, it is vitally important for you to have a long range view of your business.
You should know and understand the percentage of the homes within 8 miles of your scrapbooking store that are a part of the scrapbooking community. To have a healthy and strong retail business today you need to have 6,000 active consumers who make up the community only you can create. In the final analysis, to thrive, you must educate the consumer, propagate your message to others, and dominate your marketplace. When you do this you go from surviving to thriving. And that is being retail SMART.
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