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Turn browsers into shoppers

August 2006
The first 3 to 7 seconds after a consumer notices a product in a store is the moment of truth when a shopper can be converted into a buyer, says the multi-bilion US consumer product supplier Procter & Gamble

And the innovative retailer will convert that moment of truth into a moment of sale, explains Steven Platt, the Chicago-based director of the Platt Retail Institute, a US retail research, consulting and analytics firm.

He was in SA to do countrywide presentations to local retailers and marketers on behalf of Johnnic Communications’ Newspaper Division and IBM.

That moment of truth is linked to another buzz-word, namely shoppability — or in plain language, the ease with which shoppers can buy in a store.

"Make it convenient for shoppers to get to your store, but once they are there, try and keep them there," says Platt.

If shoppers enjoy the time spent in your store, the chances increase that they will buy — conversely, if shoppers feel stressed while browsing in your store, they would want to get out of the door as fast as possible, probably without buying anything, and are not likely to return in the near future, if ever.

The following factors promote shopper stress, that lead to that let me get out of here feeling, says Platt:

    » Too many of the same kind of products, which make choice difficult;
    » Confusing promotions;
    » Ineffective graphics that do not tell people what they need to know;
    » Poor store navigation;
    » Bad service – or no service
    » Long lines at checkout... just like diners hate to wait for the bill after a good meal, a good shopping experience could be spoilt if a customer has to stand in a long queue — which could result in them dumping merchandise and leaving.

One way of combating confusing promotions and ineffective graphics is the use of digital communication panels, which allows the store owner to provide fast-changing marketing messages to shoppers in specific areas of a store.

The digital panels can, for instance, be used to provide information about the technical benefits of a product, show how a product has to be assembled or the different uses, make suggestions about shoes and apparel that go together, or simply entice shoppers to walk down aisles that they may have passed by.

"The technology facilitates the delivery of messages that retailers and brands can use to build customer relationship," says Platt. But, the placing of the screens are crucial, as hidden or too high screens are ineffective, and could even be dangerous.

"Research show that in-store advertising can change consumer behaviour — it all depends on the product, the placement of the advertising and the consumer you want to attract."

But, even before shoppers become buyers, they need to be convinced to become patrons of a particular store. Platt discussed several examples of new trends in US retailing where stores used innovative strategies to attract customers. All of these had a thread: they all offered their customers something different to their competitors.

Women’s specific apparel and sportswear boutiques are, for instance, a successful trend that he identified — sales growth in these boutiques where women could browse for gym, yoga and other sportswear without being overwhelmed by the traditional male sports equipment, all outstripped the national average. Another successful group is Steve & Barry’s University Sportswear – their 65 stores sell a wide range of inexpensive college teamwear at very low mark-ups, but exceptional volumes.

Innovative technology

A retailer needs to utilize all available information to ensure that his store meets all his customers’ needs, consultant Jaco Barnard explained.

That includes the use of available technologies like security cameras ... instead of the security guard, the manager could use security cameras to monitor shopper behaviour. This can show whether shoppers linger and look, or make a bee-line for the door after dashing in; whether displays actually draw in people and which isles customers are most likely to walk down.

Global trends have shown, for instance, that value added services like the option to pay various bills at point of sale actually loses, rather than wins, customers. The trend is now to create a separate hub for these additional transactions to speed up the point of sale transactions.

A future development is self-help exit points to streamline the shopping experience even more, as customers have less time.

The US retail market

Retail trade accounted for 30% of US GDP in 2005 and the US economic downswing therefore also impacted on retail sales.

Although personal spending still comprises of more figures than one can take in at a glance ($8.7-trillion, compared to R839-bn in SA) the middle sector of the market is shrinking … shoppers are either favouring higher end stores (8.7% growth between 1999 and 2004 compared to 5.7% growth in the middle market) or are getting poorer and therefore spend less.

Stores traditionally aimed at the up-market sector, like Neiman Marcus, increased sales by 5.4%, while the industry average was 4.1%. Budget chain Wal-Marts, aimed at the middle sector, grew 2.3%.

The annual revenue posted by some of the top US retailers gives an indication of the enormity of the market:

    » Wal-Mart $249.7-bn
    » Kmart $19.1-bn
    » Sears, Roebuck: $30-bn
    » JC Penney $18.8-bn
    » Kohl’s $13.4-bn
    » Nordstrom $7.7-bn
    » Neiman Marcus $3.8-bn

Compared to the vibrant SA apparel retail market, growth in apparel sales for March, April and May this year had been 0.5%, 0.5% and 0.2% respectively.

Some of the top apparel stores clocked the following sales in 2004 per store:

    » Gap $5.4-m
    » MarMaxx $7.3-m
    » Abercrombie&Fitch $ 2.7-m
    » Ann Taylor $2.7-m

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