Archive for October 19, 2011

In-store Must = On-line


When you walk through any retail store today most of us in the business (as well as most shoppers) can quickly discern if the store is well stocked and merchandised.  But “what we cannot know is quickly becoming just as imperative as the more obvious traditional aspects of the retail environment.  That is to say, we cannot know whether or not the physical store is in compliance with its plan-o-gram, merchandising plan, or even whether its carrying all the sku’s it is prescribed to carry.

Why has compliance become so important?

To be honest, a store could be out of sync with its plan and still be a pleasant place to shop.  In fact, it could be a very successful, high volume store, making cash hand over fist.  After all, the customer doesn’t really care about all of those brand/retailer dynamics, “just be in stock on my items and don’t make me stand in a long line at the checkout!”

But in the day and age of brands paying for shelf placements, end caps and promotional execution, there is an opportunity cost for both brand and retailer if plans are not executed at retail level.  There are potential lost sales for out of stocks, as study after study tells us that a significant percentage of shoppers choose no substitute if their first choice is AWOL.  We also know that advertised promotions and programs that are not available or supported in-store bears a cost of sorts.

While systems agents, and processes are in place (or at least available) to monitor compliance, there does not appear to be the sense of urgency in the retailing industry to improve in this area. Perhaps the primary reason for complacency is the dearth of cogent metrics that accurately describe the finacial impact of being out of sync with the plan.  In my view, remedies need to present themselves quickly as now there is a much more compelling reason for compliance.  Enter the on-line “pre-shopper”.   With the elevated consumer expectations that are being fed by the on-line experience many shoppers have prior to visiting the bricks and mortar store, the physical store must not disappoint.

Allow me to expand on this notion.  As more and more consumers practice the art of “pre-shopping” on-line prior to the next shopping excursion they are loading coupons to card, printing others out…..you better have the product in the store, or their efforts are for naught.  New software facilitates an intelligent shopping list, listing the items in order they are found in the store.

If the store is not in compliance with this layout due to store set changes or other….more consumer frustration is on the way.  I could continue for a number of paragraphs on examples where consumer expectation have now be elevated due to the convenience of shopping applications and software.  If the store is not up to the task, lost sales are a certainty, lost customers are an eventuality!

More will be coming on this topic with additional points of view and case studies that will begin to put some empirical numbers behind non-compliance. But even without the numbers and the data, it would seem to make intuitive sense tht developing a new system or enhancing the existing process that store managers and their team employ to check on and remedy non compliance situations is worth a conversation.  Whether the resulting tool set is a series of scorecards, software and daily reports, or other…..shoppers are going to migrate to the retailer that presents the most consistent environment where ever the shopper encounters that retailer.

Stores where “on-line ≠ bricks and mortar” will not retain their fair share of the growing number of cyber savvy shoppers that have more shopping choices than ever before.