Dear business economy,
Here comes the consequences of your lack of action.
Bardot is gone. EB Games are shutting up stores. Old businesses like McWillliams are folding. Many are pondering why? What happened?
It’s been coming for a while. Working in the investment space, I’ve been watching this unfold over the past few years. Changing how you do business and operate in this online world was not something left to chance. Nor is doing the same thing over and over and expecting a different result. Thriving in modern business comes down to the vision to stay ahead of the pack through extraordinary strategy, innovation, and engagement.
Those who listen are thriving and capitalising on the many opportunities that exist in retail world.
Businesses aren’t meeting the needs of the consumer. They aren't putting in the effort to standout. Well, some are - and that’s why they’re at capacity, busting at the seams, like us. But to those falling over, there is no one to blame but their very own actions, or lack thereof.
Let’s rewind to just before Christmas as a perfect example of why retail is in crisis.
My family and I ventured out into the suburbs to visit Highpoint Shopping Centre looking for gifts; if we didn’t need it that day, it would have been ordered online. Notoriously city chain stores don’t keep enough stock popular products on the shelves. Problem number one - apparently children don’t live in the city, retail has missed the throngs of families moving into CBD areas.
Kmart, Toyworld, and Target are all within 20 metres of each other, so we looked in all three for every little girl's dream - doll giant collection box. It was $140 at one, $150 at the other, and $300 at Toyworld. Here’s problem number 2 – exorbitant pricing from the small retailer with no customer experience attached. What am I getting for the extra price?
We thought it was a mistake. A few dollars we don't mind but double the price for the same item within a stone’s throw of their competitors. They don't price match, and the only reason is they’re a small retailer - come on now, you’re not kidding anyone.
Strategy and engagement are the reasons WHY and HOW businesses don’t entertain the price wars, and can charge what they want, because they meet the needs of value for the consumer. I’ll prove that point with PEOPLE as well. I am regularly head hunted for c-suite roles and asked, “what can we pay you to consider it?” It’s the value I offer and why many businesses contact us with the opening line ‘help me’.
Fantastic Furniture is another example of this - certainly not the cheapest available, however when I can comfortably order my own colours and have the comfort knowing if there is a stain or slight damage, they’ll replace it no questions asked - I’ll happily justify the extra cost. Amart certainly misses out on this market.
Fantastic Furniture are not perfect; they have improvements needed as well, but they prioritise the consumer experience, and that’s why they’re ahead of the pack.
Back to the Kmart, Target, and Toyworld dilemma. I’m a Kmart person, why? Because they meet the needs of the consumer, simple and convenient - there is no false ego. Target, somehow was convinced to upgrade their image, forgetting the most important part, their consumers, and upping the price, and downgrading the quality and design. They’re awkward, and I will only go if I absolutely need to.
As a little girl, I loved Toyworld. My snob like parents used to buy the expensive items; it used to be a fun place to visit. They have an opportunity to bring back the experience every child dreams of. No one is doing that at the moment, and the parents and children of society are craving it - including us.
Problem solved. People will happily pay full price, your price, if they saw the value there. Retail chains: it’s up to you to change. For the brands like Bardot, Jeans West, and all the others closing their doors, this applies to you as well.
Focus on Innovation...Strategy...Engagement...
Social media isn't going to make you a success, we've proven that, with social media accounts with five to six-digit followers gaining less than 10% the result we do when we have 2-3 digit followers. When I saw the recent influencer campaign of a brand mentioned above, having known a few of the faces in their campaign, I thought to myself before the campaign release – “what actual benefit is that going to do for the brand?” Moments later, they announced their collapse. That money could have been spent better elsewhere to keep people in jobs, and the brand alive.
The 'cheap China' argument is totally invalid. Those shunning international markets don't realise this is where many Australian by-products and products come from. There is standing argument in our family, my adopted brother is an engineer, he thinks he deserves priority over the Asian import who gets paid half his rate - and we disagree. I'm all about strategy and ROI, so yes, if I can get a better result with better ROI from the import, he would be out of a job, but lucky for him, he has me telling him how to justify himself in the market.
How’s this for bad business? Our steel company recently gave the local steel mills a chance to be our key suppliers with tier one and two contracts. We did our bit to try and support local. In the weeks they took to reply to an email, we’d already had the orders completed and near delivered by China. Key point here - value and convenience. From the other side of the world, it was more convenient and quicker to order our steel (not to mention their service is 5-star as they know they have to bring their A-game to win business).
Australia, if you want to get your business economy back on track, it's time to lift your game.