Retail's inflection point requires seamless storytelling

Consumers are fueling a retail revolution that allows them to shop when and where they want, but success still boils down to product, service, and systems, as Trader Joe's and Walmart show.

If ever there was a customer-facing business where the staff is the first line of a brand’s reputation then that industry is retail.

Think about your own shopping experiences. I’ve already written about my mom, who worked retail on the shop floor at British retailer Marks & Spencer for 35 years, and how she was one of the best ambassadors for her brand. That direct physical frontline retail experience as a customer totally colors your view of the brand you are engaging with.

This was brought home to me again the other week when I popped into my local Trader Joe’s late one evening just before closing time. There was an air of energy in the air as staff buzzed around refilling the shelves for the following day. Everybody seemed to have a smile on their face and they clearly enjoyed working with each other.

True, at this time of night the shelves were pretty empty. But in a way this was encouraging, as it showed goods were flying out the door and there was no moldering stock lying limply before reaching its sell-by date and having to be dumped.

The staff clearly saw it as part of their mission to get the stock refilled as quickly and efficiently as possible. And the stock ordering and management systems appeared to be working well, as proactive managers oversaw the action.

They were also happy to stop and help customers and actually try and find a solution to their enquiry rather than just fobbing them off.

The guy manning the checkout line greeted every customer warmly and chatted to them before guiding them to the next available cashier. There was no feeling of forced bonhomie. The culture of working at this place clearly meant this is what you do, and whoever’s inculcating that culture within the brand is doing a damn fine job.

Of course, there’s no point having great customer service if your product sucks, and Trader Joe’s has worked hard at this too, to the point where, for example, there are numerous blogs devoted solely to the retailer’s frozen meals. For the millennial audience especially, they are perceived as cheap, fun, environmentally friendly, and as selling great products.

I left the store feeling good about life – and, believe me, I HATE shopping.

Compare that to a competitor retailer just up the road, which I popped into to get something they’d run out of at Trader Joe’s. The grocery shelves were overstocked with goods you just knew were on the brink of going out of date. The staff was concentrating on picking the bad produce out to throw away and removing products that had reached their sell-by.

There was a low energy in the air and no one was interacting. The overriding feeling was one of "how long until the end of my shift and I can get out of here?" The place was dirty. The store layout was cramped and not user-friendly. The stock ordering and management systems were sub-standard.

As I checked out I had to navigate around a broken bottle on the floor. There had been two Tannoy announcements asking for someone to come and clear it up. As I left the store there was still no sign of a mop and bucket. Noone was showing any pride or responsibility in working at this place.

I felt depressed and vowed not to return unless I absolutely needed to.

Two high-profile national brand experiences: Two totally different reputational outcomes. And these interactions are repeated millions of times on a daily basis throughout the United States.

I don’t know for sure, but I doubt the workers are getting paid any more in one place than they are in the other. And I’m not blaming the staff at the latter outlet. It is a company’s job to inspire its staff to buy into the organization’s mission and activate on it every single day. That’s where great leadership and effective internal communications come in.

Coincidentally, I just interviewed Walmart’s lead communicator Dan Bartlett for PRWeek’s February Newsmaker slot (if you’re part of our corporate subscriber program you’ll get an early view of this piece today, otherwise it will be live Feb 1.)

Clearly the person who leads comms at the world’s largest company has a lot of interesting things to say about retail and reputation. But what struck me most was his comment about how retail is on the brink of a real inflection point – one largely being driven by customers and their behavior.

The retail experience is no longer confined in-store. The internet and, increasingly, mobile technology have put paid to that. That’s why Walmart has a data center in San Bruno, California with 3,000 staff looking at the future of retail and how tech and ecommerce can help them serve customers better. It also has comms staff embedded there.

But it’s much more than a case of e-commerce changing an industry – it’s already gone way beyond that. Modern consumers want to shop totally at their own convenience. They want the best products in the segment they can afford. And they want the best value.

That could mean shopping online and picking up in-store. It could mean browsing in-store and purchasing via mobile for home delivery. It means checking prices using your cell phone and expecting the retailer to honor best price. It could mean traditional e-commerce – order online and have it delivered. For Walmart, it now means testing a new format where shoppers order digitally and collect at a warehouse-style pick-up point that has no retail element at all.

It also means a fundamental evolution for concepts such as Black Friday, Cyber Monday, and holiday sales. As Bartlett explained to me, Cyber Monday stemmed from the fact that you had to go to work to access sufficient computing power to purchase online. But you can now easily get that computing power from a standard mobile device, so you can do it wherever and whenever you want.

Similarly, Black Friday sales fell in 2014, but that was because more people were shopping on Thanksgiving Day itself. Younger consumers in particular don’t make distinctions about particular shopping opportunities – they just do it.

There is still some separation on the balance sheet, which Bartlett puts down to a need for "accountability and to manage P&Ls," but I suspect that will have to change in the near future as lines become increasingly blurred.

"They are not separate storylines," says Bartlett. So the nature of a retailer’s communications has to evolve to reflect that. Bartlett describes the strategy required for this new environment as a "seamless" approach, especially across communications and marketing, and a "unified message."

It also requires a seamless approach to communicating to the financial community, especially at a time when Walmart has struggled to post increases in sales.

Bartlett noted that, last fall, Walmart was "very forthright and transparent about the journey we’re on and that we're going to be disciplined about how we spend capital in our physical store structure," while also communicating that it was "going to continue to press the pedal down on our e-commerce business." He points to the retailer’s consistent share price performance as evidence that this message is resonating with the Street.

Whatever type of retail it is, and however you describe it, the experience is still about great products; great systems; efficient customer service; great, motivated staff; and getting product to those customers exactly when, where, and how they want it.

If you get those ducks in a row you will have a successful recipe for a positive brand reputation, a pleasant customer experience, and good sales and profits.

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