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As Amazon's second two-day Prime Day of the year approaches – this one is October 8 and 9 – retailers from all segments are wondering (or being asked): "So, how do you compete with Amazon?"
Our response? You don't, at least not directly. Not on their turf.
Look, independent retailers do have many strategic advantages over Amazon. Your challenge – and opportunity – is to recognize them, and enhance them at every opportunity. Here are some ideas that you may want to consider to allow you to compete on your terms.
No more attempts to be all things to all people. Instead, focus on the portion of your market – and the customers – that are most profitable for your operation. (Go here for more about that.)
Remember that life stages (presence and ages of children in the household) drive buying decisions. Shoppers from which lifestage are most profitable for your stores?
Amazon can certainly undercut any and all competitors on price. And being asked by would-be customers to "match Amazon's price" is not going to end well.
But, you do have the opportunity to trade up.
Sell on quality; and serve those customers who value quality.
Give yourself permission to say goodbye to the price hounds who only want the lowest price.
Now that you have a focus on your key customer segment, what else might those folks want to buy from you? Consider adding appropriate complementary products.
Coordinate with other retailers in your segment – whether through a buying group, a trade association, or another group – to develop private label merchandise. This offers all those participating retailers a unique sales and margin opportunity. And once this product line is in place in your stores, you may find that it prompts a bit more respect from your other vendors.
Your goal is to get people into your store, right? Then, use your website/web presence to make that easy for them.
We think it is essential that your website and other online presences "do justice" to your store, especially the richness of the experience of shopping with you.
Give your customers a way to do their online research before they come in, to know what's special about your stores, and why they should experience it for themselves.
Showcase your people.
Showcase your merchandise, the stories behind it and why you have selected it.
Have your website reflect that warmth, the customer focus, the "let's find a solution" attitude of your stores.
In retailing, one must win both the minds and the hearts of the shoppers. In that race, independent retailers can have a decided advantage over Amazon.
You’ve got it. Now flaunt it!
As Amazon Prime Day approaches – it is June 21 and 22 this year, the earliest ever for this 48-hour promotional event – retailers from all segments are wondering (or being asked): "So, how do you compete with Amazon?" Our response? You don't, at least not directly. Yet independent retailers do have many strategic advantages over Amazon. But you must recognize them, and enhance them at every opportunity. Here are some ideas that you may want to consider.
Let's assume your stores have been closed for weeks now.
We recognize how conscientious you are. So, after paying what you can to your employees (and yourself), the next most-worrisome dilemma is your rent.
As you likely have discovered, a common choice for many landlords is to offer to defer your payments. But that means taking on more debt, as those payments are only being postponed to a later point in time. You need a better solution than that.
A frequent recommendation for how to navigate the current economic uncertainty is to be more diligent about controlling expenses, and focus on profit. (You'll see; we challenge that below.) Hmm. Concentrating on profits is easier said than done in today's environment, with cost increases proliferating under the umbrella of inflation.
Ahh, springtime! A time for new beginnings, fresh starts. Spring also is a time for "Spring Cleaning" – that time of year to spruce up, clean up, fix up. Sigh! Another chore. This year, here's how to break out of that another-to-do-task rut. It starts by seeing your stores the way your shoppers see them. Then, with that awareness, the spruce up, clean up, fix up tasks can actually focus on attracting and appealing to your very best customers. And we have the (free!) tool to make all this happen.
Remember thinking that Amazon was the most disruptive force to happen to retailing? (Well, at least since Walmart was the most disruptive....) However, the coronavirus pandemic eclipses them all. No matter where you live or do business, it is not whether, just when, COVID-19 will impact your life. Disruption with a capital D!
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