How to "Shop" the Competition
Posted by Don Capman
Although you may be doing a pretty good job running your business, you can always do better. You’ve made it through the Great Recession. But didn’t you notice that retail just isn’t the same anymore? You have to work harder and smarter to get consumers to part with their dollars.
What’s the best way to find out about some new and exciting ideas from other retailers? Go shopping! Most retailers get so bogged down in their day-to-day business that they don’t take the time to get out and shop the competition.
When "shopping" the competiton, pay attention to:
1. FIRST IMPRESSIONS are often a determining factor when people are making buying decisions.You feel a certain way about a store when you first walk in. That could be good or bad. This is very important to understand since you should always be concerned about what first impressions potential customers have about your store. If you’re shopping another retailer, be conscious of your senses and jot down notes after you leave the store about how you felt when you walked in. Was the store pleasing to your eyes, easy on your ears, pleasant to your nose, and comfortable to your skin?
Ask yourself what you think they’re doing right and wrong. Make scrupulous notes, or you’ll forget some key ideas you might want to try or try to avoid in your store.
2. HOW WELL IS THE STORE MERCHANDISED? Competitive prices and selection are increasingly competitive. If the store doesn’t carry the merchandise I want, or if I can’t find the items I’m looking for because the placement of the merchandise makes no logical sense, I probably won’t return to that store. If I can’t find it, I can’t buy it. By shopping your competitors, you may get some great ideas on how to better merchandise your inventory and pair up complementary items.
3. HOW IS THE STORE HYGIENE? Is the store clean or is it a pig sty? Shelves, floors, windows, dressing rooms and rest rooms, should merit regular attention. A dirty store tells the potential customer that you have no respect for them and, if they come to that conclusion, they won’t buy from you. Additionally, they will tell their friends.
4. IS THEIR PERSONNEL PROPERLY GROOMED, KNOWLEDGEABLE AND FRIENDLY? Retail is notorious for high turnover and low pay. Standards are often kept to a minimum. Potential customers expect store personnel to know and be enthused about the products they are selling. They want to know the store personnel are authentically concerned about fulfilling their needs and will provide them with a warm welcome when they return to the store.
5. ARE IN-STORE PROMOTIONS AND EVENTS OBVIOUS AND ENTICING? Promotions and events are becoming increasingly important. Not only do stores need to keep their inventory fresh, they need to create a “buzz” that attracts return visits. Take notice of what your competitors are doing to promote their stores. In these days of ecological awareness, a “green event” could be very popular.
6. DO YOUR COMPETITORS HAVE A GOOD SELECTION OF MERCHANDISE AND IS IT COMPETIVELY PRICED? Knowing your customer is critical when selecting merchandise. Successful stores are constantly monitoring trends and customer preferences. A retailer’s point of sale system or POS software usually has some type of customer relationship management capabilities that unobtrusively track the buying habits of their customers. Analyzing this data on a regular basis helps a merchandise buyer know what and how much to buy and how to price the merchandise properly. Smart retailers use tools such as planning and open to buy to help them make informed buying decisions. A point of sale system collects data to feed these now necessary business intelligence tools.
Shopping your competition is not a onetime deal. Keeping ideas fresh is hard work and is an ongoing process. Scheduling the time to shop on a monthly basis is the best way to ensure that it will happen. When it becomes a habit, shopping can actually be fun. Don’t go to the same stores every month. Mix it up. If you’re afraid you’ll be recognized as a spy, send a mystery shopper. But don’t forget to take notes, notes and more notes.
You may be surprised at how rewarding shopping can be.
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ABOUT THE AUTHOR
Don Capman is President and co-owner of J.D. Associates, one of the largest distributors of retail POS software in North America. With Retail Pro, Microsoft RMS and QuickBooks Point of Sale in the company portfolio, J.D. Associates offers retail POS software solutions for specialty retailers. He can be reached at don.capman@jdapos.com
