What we do as retailers now will determine what retail looks like in the future. We as consumers are hitting the pause button because of the coronavirus, but as retailers, we can’t.
We as humans seem to be programmed to go negative when faced with crisis. We connect dots until all is lost.
We can’t allow that to happen.
Your employees are counting on you.
Your customers are counting on you.
You are counting on you.
You have to be the hero in this story.
For a fix-it guy like me, it is hard to adjust to this economic crisis and hard to acknowledge it isn’t something that can easily be fixed. We’ll have to just wait out the shelter-in-place at this point. Testing is the fastest path to restore confidence in Americans and that will take time.
In my planning, I’m figuring re-opening will not happen until after Mother’s Day, May 10. If it happens sooner, I’ll be grateful, but public health will be determined by governors, not pundits.
I may not be able to change the outcome of things, but I can control my response to the process as it plays out. And to that end, I am writing this for you…
We’ve bounced back from 9/11 and the 2008 recession. We’ve had all sorts of personal and professional catastrophes.
We have a short memory.
The more we remember this is a WE moment and not a ME moment, the better we’ll all get through.
After 9/11
The closest parallel I think we have is how the airlines got back into business after 9/11. The planes had been parked at various points around the world. The air traffic controllers had to adjust to planes they didn’t normally deal with. The airlines had to get them back to their usual routes and co-ordinate to create a new schedule people could rely on. And then they had to get people back into the idea of flying. It was an act of courage to get on a plane in the weeks and months after 9/11. From those early adopters, the rest followed.
Most companies aren’t willing to change until they are in financial peril and scared. For most of us, that time is now. But we need to move past that and take advantage of this time to find the opportunity.
And I’m certain, opportunities will come out of this.
The fear is we lose the joy of shopping like we temporarily lost the joy of flying. As small businesses start to reopen, those first few people who come out will be crucial to drawing others out.
In-store Management
Will our employees look at shoppers as germ carriers? Will we all want to get in and get out? Will we all be asking permission to come over and help someone? Will we use hand sanitizer after every interaction and if so, will this push people away?
Will shoppers crave interaction and be intrigued to discover that which makes us feel more human and less isolated? I think so but all of it will be in degrees.
Know this, the retail covid-19 sales slump won’t discriminate. It is hitting big and small, online and off, new and established.
The key point is what are you going to do to get out of it as customers return?
We have to look at the opportunities. We have to reinvent ourselves.
The clock is ticking.
We’ll get back to work, but the key will be how we can get back to growth.
So what has to happen?
The Great American Reset
Reset: to set again or differently
You have to look at this time like you are planning a new business wherever you are in the world. Your capital will be challenged and you’ll have to have people working when there is low demand. You’ll have to market yourself as more than just open but do more to become your customers’ favorite place. Just like a new business, you’ll have to have a soft opening and a Grand Opening.
And you’ll have to sell your way out of this more than any previous time in your business life.
With unemployment expected to be upwards in the double-digits for the foreseeable future, you won’t have the luxury of holding on to anyone on your team who honestly can’t make a shopper’s day. The good thing is you should be able to upgrade your crew like never before.
You have to remember when you first opened. Or even when the big boys started ...
Bernie Marcus and Arthur Blank dreamed up The Home Depot at a coffee shop in Los Angeles in 1978. They envisioned employees who would not only be able to sell, but they would also be able to walk customers at every skill level through most any home repair or improvement. It wasn’t enough to sell or even tell; associates also had to be able to show.
Or when your parents or grandparents opened their stores...
They would have done anything to get any money from anyone. They personally reached out to thank each and every shopper. If they didn’t know the answer, they knew they had to find it – fast – before that shopper went to someone else.
It can’t be okay to just let shoppers wander through your store unaided. How will you care for them besides having hand sanitizers stationed like gift card displays throughout your shop?
Customers won’t know what they are necessarily looking for. Will you still expect them to tell you? Will your associates be able to create a bond between your products and those early adopters?
4 Realities For Retailers When They Reopen
First off, understand most retailers will indeed reopen.
The granddaddy of all clearance sales
You’ll have to deal with markdowns of spring items. Go big to clear them or hold onto them and compound the issue. This will be as tough for apparel retailers now as it can be for hardware stores dealing with snowblowers during an unseasonably warm winter. Actually, worse because you can store the snowblowers until the fall. Old clothes are still old clothes. The longer your store remained closed, the worse this old inventory will be. And there simply aren’t enough third party vendors to take it all.
Caring For Early Adopters
You potentially could be open for weeks with only a few shoppers coming in. I doubt there will be an all-clear signal from anyone. That means your first shoppers who venture out will be courageous. They must be welcomed, greeted, and cared for with kindness and not suspicion.
Your store must be fully integrated from online, app, and brick and mortar. Even smaller independents can no longer boast, “We don’t have a website. We don’t need one.”
Same for social media. Every business will be expected to use Facebook and Instagram to connect for the foreseeable future.
Your store will need a merchandising reset as well. Don't think you can just re-open and shoppers will come streaming in to discover early March merchandise and messaging.
Each day you’ll have to look at how you can serve your customers better. You’ll have to see what went good but also what could be better.
Be careful of your messaging
You would think from the hotel and airline emails I’ve received this week that they will never re-open again. Their downbeat messages scream hope is lost and that we’re in the time of deathly hallows.
Where is the hope? The we’re in this together. The message, We look forward to a day we’re back to normal and welcoming you into our properties or onboard our planes?
That’s the message your customers want from you. Stability. We’ll get through it. See you soon.
Marketing Has Its Limits
You can’t market your way out of this with a coupon. You’ll have to discover where you fit into the retail world. Wellness is going to be a huge theme for the rest of the year. How are you going to care for fragile customers whose world was turned upside down?
You need to think about that.
Think about all the birthdays that were missed, anniversaries, and special occasions. You'll be able to market the hope they can still do those things...even if a bit delayed. Plan now.
You also need to do the hard work of looking at your business with fresh eyes.
You are essentially starting a new business, here are questions to answer during this reset time:
- Who are you?
- Who is your target customer?
- How will you reach them?
- What values will you use to filter your business decisions?
- What merchandise does your community have a need for?
- What kind of branded shopping experience will you be known for?
- Who will you hire and what qualities will you look for?
- How will you train your associates to deliver your branded experience?
- How will you follow-up with your best customers going forward?
- What kind of technology do you lack; what do you need and how will you use it?
- What should your profit margins be?
- How much can you put into Google My Business for a robust profile?
- What is your social-media strategy and priority for posts, videos, commenting, and getting reviews?
What we will need to see in the economy to know growth is coming along?
What economists call green shoots will be when we see:
- Less cases of the virus being reported for at least two days in a row.
- The ability for large groups to meet.
- The restart of MLB baseball.
- Car traffic or subway rides increasing.
- Auto sales increasing.
- Housing sales increasing.
Li-Gang Liu from Citibank noted when speaking of the SARS recovery of 2003, “When the virus was contained, manufacturing rebounded sharply, in a so-called V-shaped recovery. But service industries, including hotels and restaurants took several quarters to fully bounce back.” I would expect the same this time.
Yes governments are injecting huge amounts of capital into businesses. But we must get back to normal life. Business can't fully comeback until people can solidify events in the future and plan for them to bring back jobs, business activity, and consumption. No amount of stimulus can turn that tide.
BTW smaller retailers looking at the new stimulus plans, here is a great comparison between the two types of US SBA loans available courtesy Krost CPAs.
One more predication: Trade associations will be seen as more important as shell-shocked retailers crawl out gingerly to discover the new shopper and what they can do now that they had been avoiding doing before the virus struck. To those associations, your time to step up with leadership, inspiration, and hope over the next quarter will be crucial for your own and your members’ survival.
In Sum
Of course, we are all worried about what will next happen. Panic in private if you must, but project strength and level-headedness with everyone at all times. Look for even a grain of hope in the news.
To go further with your own mindset, stop digging deeper into the what might happen or how a virus works to overcome the body stories prevalent on social media.
I wouldn’t say you only have one shot to get this right. But ….
Shoppers have to feel good when they return. No, they have to feel awesomely, even fabulously, thrilled at going to your store. They’ll be open to more humanity. They’ll have had enough fear.
Will you be ready?
The great shame would be to go back to little interaction and taking shoppers’ wallets for granted.
If that happens, this time to pause, reflect, gird your loins, reset, and fight for your business will have been for naught.
You need to realize instead of looking at how much your business is down, the fact you have a business at all will have to be celebrated.
When I was CMO of It’s A Grind, a coffee franchise based in California, new owners would complain abut how few customers they had. “After all,” they’d say, “look at how many people are at Starbucks.” I’d have to tell them to stop looking at what they didn’t have and comparing. Take care of the customers who found you, brand their butt with your brand and the product, service and most of all, the feeling they had interacting with you. In a few weeks you can look at the trends and notice it is all trailing upwards. But for now be of service and be grateful.
Be of service now.
Hone the craft of retail.
Train every associate to create an exceptional experience.
That’s because pretty soon in the future, you’ll have the propensity to say, “I’m too busy to train.” You’ll return to the least necessary actions to feel good about yourself.
And at that moment, you’ll be returning to a path other small businesses and national chains are riding into oblivion.
The clock is ticking.
The great American reset has begun.
Get busy.
In hope, I am fearless.
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