Retail Merchandising & the Web
If a picture is worth a thousand words - what makes your thousand stand out?
 
Given the obvious relationship between a motorcycle buyer and all of the accessories they will be interested in after they have bought their bike, using the internet to grow sales requires some serious thinking. These days customers shop on-line first and in-store second, but so many retail websites reduce entire brands to bland lists and confusing clicks. Increasingly we feel pressured to add lots of bells, whistles and other questionable thing-a-ma-jigs to our internet investment – but is it driving sales or slowly taking the uniqueness from your brand?
 
In the good old days capturing floor space in a retail store, preferably one with decent foot traffic, would get the sales moving. However consumers now use the internet as a natural filter before they ever get into a store to see a single display.
 
For example:
Consider seasonal overstock. The motorcycle business is highly seasonal – no secret there –so any intelligent buyer knows that things like helmets and jackets are going to be cheaper at the end of the season. In the past this was simply an inventory markdown exercise – you sold what you had and started thinking about next year. Today however, on-line overstock is so prevalent and the ability to tell one product from another through the use of a couple of photographs is often the only chance you have to stand out and build brand in the mind of the customer. One glove becomes like another, one pair of boots looks like the next – in short – a brand killer.
 
Maybe a fat advertising budget can help blunt this effect, but in this environment the customer will often develop a brand loyalty by chance - not nearly the type of relationship which gets established in a live retail environment, but those days are quickly passing.
 
Is this a problem of Product? Advertising? Pricing? Technology?
 
None of the above.The problem is customer service.
 
Know your customers
Simply put sales channels/distributors are a nice cost effective way to sell – but all to often a manufacturer slowly cedes the entire customer relationship to the distributor. While this may not be a problem for the top couple of brands in each category, smaller manufacturers, (and small retail outlets for that matter) can really get the screws turned on them. A physical stores has limited floor space, so they have to make choices about inventory, giving a successful brand some leverage in the relationship – the long tail of the internet provides unlimited inventory – brand loyalty is slowly lost, and manufacturer leverage is effectively eliminated over time.
 
In the end, a shift of balance this dramatic is good for neither the manufacturer or distributor.
 
Customers - not products - are the business
What to do? You are the expert when it comes to your product and your brand. Your customer will respond if you procatively reach out to them. Invest in your customers – put data to work for you - the same technology which can strip away brand value can be used to make cost effective, one to one customer relationships possible in powerful new ways. Having a presence in the customer relationship is the cornerstone of sustainable brand value.
 
Oddly enough the high-tech bubble of a few years back provides a great model for this dynamic – the companies who developed products combined with services requiring frequent recurring opportunities for customer interaction survived to do very well and are very focused – whereas the traditional hardware and software - manufacturer and distribution only - companies have been forced to diversify their markets to build their business.
 
Create innovative ways to expose your customers to your brand - companies, with quality products, who have successfully reclaimed their brand value over time did so by putting a structure into their sales channels which allowed them to build good customer service and loyalty - not bypassing or undermining the distributor - instead helping the distribuor by protecting brand value and slowing price erosion, in effect regaining the teamwork between distributor and manufacturer once found in-store, which on-line retail has often skewed in recent years
 
If you know your customers well - and care for them as well as your products do –- your brand will retain its value, distinction and pricing power.