Episode 9: Amazon and Retail, How Do We Compete?

We all can appreciate how great Amazon is, but as a small retailer, can you compete? Big box retailers are closing down more stores now than ever but there are still some things that an independent retailer can do to stand up and maintain relevance in this very different retail environment.

*Disclaimer: This transcription was automatically generated so we would like to apologize for any misspellings or grammatical errors in advance

Today we’re going to briefly discuss how great of  a company Amazon is, but we’re going to identify what retailers can do to still compete in this very different an ever changing retail or online retail environment. We are going to discuss big players like Bass Pro Shop, independent chains and at its core we’re going discuss how retailers can think outside the box to create a customer experience that people enjoy, that’s friendlier and overall more customer centric.

Justin: Harry, welcome back! How are you today?

Harry: I’m quite happy to be here.

Justin: I’m happy you’re here too.

Harry: What have you got for me today?

Justin: Alright, you’re going to like this one. Today I wanted to discuss what Amazon does great but, how a small retailer can still compete in the world of online shopping.

Harry: This is really going to be short. (Laughs) the first part of the question as is what does Amazon do great and the answer to that is, everything.

Justin: All things, right. They’re just so spectacular. What a disrupter of retail life in America is all about if not the world. So what do they do right? Well first of all they make it easy to get out navigating and using the site. They make it easy to pay, they make it easy to track, they’re just on top of it. They’ve taken their resources I think they’ve taken their resources and used them to continually upgrade and enhance you know the site. So let’s just say they completely disrupted the retail place marketplace and they’re rocking and rolling and I absolutely adore them.

Harry: Yeah, I think one area that I’ve always thought is just shocking and how great they are at this actually their customer service. Whenever I do have an issue or don’t get a package or something weird happens they are they literally have a no questions asked I’m here to help you attitude all the time.

Justin: And they’re not judgmental about it.

Harry: Oh no not at all.

Justin: You know what I’m saying like, you can return it but….now they’re just absolutely. Then they’re not trying to sell you something else. So it’s Here’s your refund! Boom! Game set match. Not would you like a credit and you know, spend later. They just do it right.

Harry: Yeah well how do we compete, how do we compete as little retailers in this environment where you have the 800 pound gorilla in the room. Well first of all, it’s pretty difficult to say that you can sell merchandise that they’re not selling because frankly I find it difficult to not find everything that they have on the site. There are certain stores or certain categories of merchandise that they don’t make available but I’m not going to start a business just on that. Retail is best when it’s a (00:03:07) you get to touch and feel the product. That’s pretty awesome, compared to just looking at a picture and I think you know that. Certain people love to buy, they love to try on, they love to push buttons, and they enjoy that process.  And what an independent retailer can do that Amazon can’t do is put things in a context for me personally. In other words, as I’m looking for things in a particular category a sales person could get to know me personally, what my goals and motivations are, and give me a broad perspective of the options and zero me in on a product. That’s what sales, and frankly, Retail should be entertaining anyway. I mean, there was an expression coined a while back called Shopper-tainment. You know, I’m not saying that we should set up an amusement park but in fact, retail stores today are really quite boring but if it’s an enjoyable experience, And you have a relationship with somebody at store level, oh my goodness! Amazon can’t, actually it’s Amazon who can’t compete with that.

Justin: What are some experiences that a retailer can create in their space to make the customer feel special, to kind of make them stand out above the rest? I’ve got some ideas and some experiences that I’ve had. I’m just curious of what you’ve seen that you enjoy.

Harry: I don’t know, have young ever been in a Bass Pro Shop?

Justin: Oh yeah oh yeah

Harry: Is that game set match or what?

Justin: I mean it’s incredible

Harry: But if you live near a Bass Pro Shop I mean within thirty minutes of a Bass Pro Shop, would you buy stuff online? I mean they have a great online presence too for sure they do. So you could buy your outdoor stuff at the Bass Pro Shop or Amazon or Cabela’s or anybody else’s but what’s the chance you would buy it online if you could actually go to the store.

Justin: Well the store is like going to Disneyland for adults right I mean you just want to go play around with stuff. I could spend three hours in there and not even know what happened.

Harry: yeah but even if you just need, if you need you know some shotgun shells you know twelve shotgun shells you go, well, I’m going to pop by the store. Right?

Justin: It’s right. That’s right.

Harry: I mean it’s the craziest thing in the world I mean there’s plenty of stores; look you don’t have to be a hundred thousand square foot store to put on an entertaining experience but if you get the idea of what they did to just completely change the world of outdoor, then you start to get an idea to some greater or lesser degree what your mandate is, is to you know, what you have to do to provide your customers with an incredible experience. I’m working with a lady in a town that I live who owns an antique barn. That’s a pretty interesting thing. Not necessarily my style of merchandise but what she’s really done is turned into a (00:06:29). so she leases out or rents out 10×10, 5×10 spaces to people that have collected all the stuff and you know they have their little booth and most of the people don’t even show up and people who like that kind of stuff going to her place and it’s a wonderland in Tiki things and I’m consulting with her family’s other retail businesses and she says what do you think? and I actually thought the store like pretty darn good there was no employees really, just a couple people to help out every once in a while and I didn’t have a whole lot of Suggestions other than the fact that I thought she should have set up a very formal and exciting tea shop with just exotic tea and crumpets or scones or something because it was just kind of have that whole vibe to it and so that people could come out with their friends and mostly women buy their stuff, maybe some guys but I mean the audience is mostly women. And you know they come out with their buddies, have a little tea, shop around a little bit. You see what I’m saying; you just add a little something to it,

Justin: Yeah

Harry: That would make the experience a little bit more tactile.

Justin: I lived in Munich for a couple years and the Germans actually do like to shop. Not sure if you’re familiar but the retail in Germany, especially for men is over the top. but No matter where you went, small or large retail stores, you would always be offered some type of espresso or presseco or wine during your shopping experience, just to elevate a little bit more. And I rarely see stuff like that in the US except I did in Dallas once at a Ralph Lauren store. I was walking in and then a guy walking around with high end truffles on a silver platter just to give you as you’re shopping. These little cool things like that, that you remember go wow that’s, that’s different! But I feel like the cost is almost nothing to create that experience.

Harry: Yes. Well I’ve talked about my client, Stereo electronics stores enough on this thing but we had a full bar in the back. So they were not allowed back there to go to the bar but you know we would always say hey what can I get you to drink and they would go ha ha ha! I’ll have a beer! And we go what kind or ha ha ha, The Scotch and we go single malt or blended? So we had that available. Look, I don’t want to put lipstick on; I don’t want to put lipstick on a pig. I mean, you have a miserable business and all of a sudden you’re serving beers, not going to solve the problem. It’s a combination of so many things but truly, the only way we’re going to knock out these online retailers is to make sure that the experience itself is over the top. so sales people who are highly trained to every inch of their life in product knowledge, salesmanship, operations; They represent the customer not the store so that they provide them with all the things that, you always try to get to the word yes instead of no and then you can have ancillary things such as something to drink or A variety of little munchie things and so forth and so on. Americans got into this funk where you know, No food or drink in a store, you touch it, you buy it. Wow! Which is so unfriendly. I’m trying to figure out how to be more friendly in this group of people that are not customer centric at all. I try to figure out how to not be helpful. So the game is, what does the customer want to experience what turns them on? I’ll give you an example, it’s so simple. in a women’s clothing store, We always try to have a little section where there’s a television and a couple chairs and some men’s magazines so the sporting event. I mean women eventually, sometimes drag the hottie and this guy wants to, you know, Shoot himself. I’m not saying it’s always the case but he wants to be there in loving support and let’s keep him entertained. So there’s lots of things we could do. My God! If you were to just sit around and say how do we create an environment where the customer really digs stuff? For example if the policy was that salespeople were not allowed to touch merchandise and that only customers could, right there we’d have a change.

Justin: What do you mean? What do you mean? Walk me through that.

Harry: Think about how many times that you, you know, I see this all the time. I’ll give you an example. let’s say you got into one of these big electronics stores, you want to buy a brand new camera and you say well what about this and then the sales person pick up the camera, right and he starts hitting the knobs and turning it around and then all this! And I think, you got to be kidding me! Salesperson should never touch that. Put it in the customer’s hands, get them involved, and get them using it. Find a way for them to use it.

Justin: Hmmm! I’m going through all these applications in my head right now as you’re talking. From experience I’ve had in the past, where I was not given the chance to kind of explore the item on my own.

Harry: Think about all the things that an online experience can’t give you. You make a list, get together with your staff, wonder all of the things that we could do in a store that can’t be done online and start to exaggerate those things. Make them exceedingly important. Drive it home to your customers that the reason they come to this place is because of these things that can happen. It’s not a matter of just a return policy or convenience. Well sometimes it is convenience, but stores can make things convenient. I mean, how many times have the stores said Hey! Do you want to put this in your car and schlep it home? I know you’ve got other shopping you do. You want me to ship it to you? You get it tomorrow? You know the next day; I mean we can do that too!

Justin: That’s right. You know I think about it. I think about my, You know I sometimes reference my dad shop in San Diego, that scuba shop and I’m just thinking about the tent sale. And for those of you that don’t never see this thing, I think it was a (00:13:11) thank you.

Harry: No. it wasn’t.  He was going to have a tent sale but we took it to a level that Twenty years later it’s still Magical.

Justin: Well it makes no sense right? You’ve got people coming in and here’s what we found out. So we do these incredible deals, just over the top and Americans love a good deal. And even in the age of Amazon and convenience of shopping online, there’s people that come down and they’ll wait in line to buy a fifteen dollar item that normally costs a hundred for two hours! they’re standing in line, I mean you should see this line but you know, what my dad does to try to set him apart, the entire time everybody’s in line, he’s walking and talking to every single person. He’s got an entire shopping cart full of beer, Water and soda for anybody who wants it. He’s got popcorn and food and it’s an event. It’s an actual event.

Harry: Absolutely! But it only happens a couple times a year.

Justin: That’s correct.

Harry: So reach a resolution that Amazon is not once or twice a year, doing something.

Justin: No.

Harry: But if you were to take the spirit of that and turn that into your every day activity, wow! Anyway so this is a short podcast but the answer is really simple. Get your staff together and you and anybody else that’s involved in the company at a high level and have a very very serious meeting about all those things that the online experience in your category can’t give you. Now, the reason that I’m not really going off on this thing is there’s a thousand kinds of retailers and a thousand kinds of answers here and I can’t go about answering all of them for sure. Can’t do that but All I did is the same thing I’m telling you to do. It’s just like what can we do that online can’t do? And let’s exacerbate this thing, let’s blow it up and make it really rock and roll.

Justin: Absolutely and for all those retailers out there that need some help brainstorming out some ideas, they can always send us a message maybe we can build a podcast around something that’s interesting.

Harry: You really think we’re running out of ideas on how we can work with retailers to explode their sales, Justin?

Justin: Absolutely not but every once in awhile, I want to bring in (00:15:30) back

Harry: Ah! You want to show the sensitivity side of our business

Justin: How responsive we are to our customers’ needs right

Harry: I think we are. It doesn’t make any sense to teach it and not be it.

Justin: Well thank you Harry for this wonderful example of what retailers can do to beat down Amazon, Even though I love Amazon, I hope they don’t go away.

Harry: Trust me, they’re not. But there are some retailers that are going away. You do think how many retail stores are closing. Didn’t you?

Justin: Yeah. It’s shrinking

Harry: Thousands! And guess what? Bye! Don’t gonna miss ya! There’s going to be very few retailers that survive at a high level and they’re rocking it and I, just to finish this podcast; I advise all retailers to take a look at what the people are doing or rock and roll out there with some unique merchandise. Stores look great, sales people are off the charts. You will always have an audience. There’s not going to be a lot of you that will have an audience because retail is shrinking in terms of square footage of brick and mortar but the ones that get it right are still busy as all.

You’ve been listening to retail revisited. If our conversation today inspired you please be sure to rate us on iTunes or shares with your friends. You can see a full list of all our episodes at www.thefriedmangroup.com. And for more information on how the Friedman Group can transform your business, you can contact us at sales@thefreidmangroup.com

A special thanks to Harry J. Freidman for sharing his thirty five years of unbelievable experience for all of us to hear.