The New Rules Of Retail
The U.S. retail marketplace is undergoing an unprecedented transformation, thanks to a number of change-making factors. We’re all aware of the meteoric rise of e-commerce and the recent decline of brick-and-mortar retail, but that’s only part of the story. Retailers across the country are also struggling under the weight of debilitating debt, largely due to leveraged buyouts from private equity firms. To complicate matters further, many young people are spending less money on products, opting instead to invest in experiences.
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Despite these alarming trends, retail is still thriving -- albeit in a different way. According to Adobe Analytics, U.S. retailers raked in a record $7.9 billion in online sales over Black Friday and Thanksgiving in 2017, up 17.9% from 2016.
Some retailers, like Target, are capitalizing on the opportunity of the e-commerce boom by improving their online platforms, while simultaneously tending to their outdated brick and mortar stores to enhance the customer experience. This emphasis on a well-formed digital storefront and a carefully curated physical presence has been the key to Pink Lily’s success and has surely contributed to our sales during our first four years in business.
In order to be similarly successful in U.S. retail in 2018, here are your new rules of the road:
1. Start Digital, Then Go Physical
If your business doesn’t already have a physical presence, consider holding off on creating one until you’ve developed a thriving online platform. Pink Lily began digital and successfully grew our e-commerce sales to $30 million in three years before we progressed to opening our first brick-and-mortar location. By following this atypical model, we were able to both generate revenue with relatively low initial overhead and accurately pinpoint what our customers would most like to see in a physical store.
2. Curate Your Social Image
It will come as no surprise that in today’s business climate, any brand will benefit from a strong social media presence. This fact is even more true for retailers. Since our inception, the growth and engagement of Pink Lily’s social media have been critical factors in our success. Your social pages are your battlefield -- your single best opportunity to fight to please and keep existing customers, as well as your space to win new ones. Build your platforms and tend to your audiences daily. Don’t miss out on the opportunity that social media provides.
3. Offer Fresh Merchandise
To operate successfully in e-commerce, your business must be continuously offering new and diverse products -- preferably on a daily basis. Customers often bookmark retail sites they like so they can check back often for new offerings, special deals and savings. In a constantly updating marketplace, a mere day or two of teasing the same products on your homepage could make your brand appear stagnant or out-of-touch. Avoid being labeled boring or slow-moving by paying close attention to the selection of items you promote, especially on your highest-traffic pages.
4. Crunch The Numbers
Understanding your numbers and monitoring the financial and analytical impact of different business decisions is essential. At Pink Lily, we are constantly monitoring things like cost-per-clicks, ROI, conversion rates, gross margins and sales forecasts. There’s no better way to evaluate whether plans are profitable or if a change needs to be made. Analysis of our own data has also helped us discover new business opportunities like other e-commerce website ideas and demand to open a physical retail store. Solid analytical skills are critical to accurate forecasting of things like investment payback, and they help you make educated business decisions.
5. Give Customers A Say
The importance of customer experience has been lauded for decades -- the impact of good service is a given, and of course, you should be doing it right. The opportunity today is less about addressing customers’ questions and concerns, though. Instead, the smartest and fastest-growing retailers are giving customers an actual say in the products they create and offer. Pink Lily does this by offering product voting opportunities so that customers can upvote the products and deals they like best. This two-way engagement has been instrumental in building our strong customer loyalty. People love to share their voices, ask for what they want and be heard.
6. Keep Asking What’s Next
All businesses must continually set aside time to think about what’s coming up on the horizon. It may be a brainstorm for next month’s special initiative or an in-depth planning session for the next iteration of your brand, but attention must be paid. For example, Pink Lily has noticed a tremendous opportunity in our graphic tees division and will be translating that success into a new brand extension in the coming months. Your business may have a similar opportunity, but you won’t find it if you’re not actively looking. The simple fact is -- if you’re not evolving, you’re dying.
This new, rapidly changing retail industry landscape necessitates a new set of rules. To manage the changes and turmoil of the industry, retailers must adapt. Only by transforming to fit the needs and desires of today’s retail consumer will your business have a chance to grow and thrive.
Post courtesy of www.forbes.com