Prior to writing my book, Predatory Marketing, I studied
the critical issues that business leaders stressed they needed to
That research on 1,000 business leaders revealed they have six
really big concerns. This is the second of that series. Their first
concern was, "How do I avoid making the wrong decision?"
Their second concern is, "Why don't more people buy my products/shop
Do you have two days?
And that would not be enough time to fully answer this nagging
question that frustrates business executives. But, here's how our
research says you need to focus your decision-making to conquer
this age old problem.
Before there can be market share, shoppers must exist. Our research
shows the "time-short" American visits fewer stores today
than even just 3-4 years ago. Today, Americans visit .5 fewer stores
to buy home furnishings, electronics and major appliances. That
shopper who visited 2-3 stores in 1990 is today only going to 1.8
stores. As you can see, in 1990 three stores had a shot at potential
buyers, while today only two stores are that lucky.
During 1988-1989, our research showed this trend developing.
That is why we coined the phrase, "Be First, Be Right or Be
Dead!" As shoppers reduce their shopping time, the battle for
shopper share will become the key determinant for judging survival
And shopper share is not only restricted to retailers because manufacturers
will need to determine the right channel or distribution strategy,
as well as the ideal location within the store to survive. There
are only so many end-caps or bargain table locations so store placement
will become the next real battleground for manufacturers.
According to our findings, there are five core reasons why products
don't sell or stores do not get shopped.
In order of importance, the first and most important reason
is lack of awareness.
The consumer didn't know the product or the store existed. That's
hard to believe, but with 83% of consumers saying all furniture
stores look the same and 74% of consumers saying stores look the
same in other retail sectors, these numbers reflect how retail stores
have created a "sea of sameness". With this dulling of
the consumers' store awareness, stores must have a bold marketing
strategy to get on the consumer's radar screen. This bold marketing
strategy must take form in either an unique advertising position,
outstanding merchandising strategy and/or dynamic store exterior.
The absence of these three means a store is falling into that "sea
of sameness" and never gets noticed.
The second core reason why more don't buy a product or shop
a particular store is no compelling reason.
When one walks into a store to make a purchase, why should they
buy one product and not another? In today's fast-paced, competitive
environment, consumers need to know. They want a reason to buy or
shop that makes sense to them. Marketing executives express belief
in their marketing strategies because they helped to create them,
but consumers rate many of these strategies as "failures to
The inability to communicate to the targeted customer results in
consumers never understanding why they need a particular product.
Without this understanding, there is no reason to buy or to shop
a particular store.
The third core reason is no identity to force a positive action.
Too many stores have no product identity, which means they never
reach a high enough level on the consumer's shopping list to be
the first or second store shopped. Sears has a product identity
in laundry, which brings them half of American shoppers who buy
Those retail stores which are "merchandise blobs" stand
for nothing except another store selling a product category.
Manufacturers must also be aware of this problem, because if they
select the wrong product identity like Zenith which dominated color
console TVs at a time when the category was shrinking, your product
identity must change as the market dictates.
The fourth core reason is lack of a unique selling proposition
(service element) to build repeat purchases.
Unless you have the largest advertising cannon, you better offer
something unique in order to cut through the advertising clutter.
The more dynamic the selling proposition, the more effective your
In the world of retailing, something unique today can be accepted
practice in one year and boring in two years. The appliance and
electronics superstore was unique, now it's expected.
Retailers who offered a quick delivery program in major appliances
or in mattress/box springs have to do more today to get the same
impact. Having an impressive TV wall was once exciting, now it's
called "a nice presentation".
Retailers are re-discovering that consumers who want "price"
want "lower prices" next time. The lack of something extra
has produced a mass of shoppers who demand lower prices making many
retail categories unprofitable.
Without a unique service, the customer is unable to build a sense
of loyalty to that retailer. In the 1950's when 66% of America was
loyal, advertising had to drive 1 in 3 shoppers. Today, advertising
is driving 7 in 8 shoppers since only 12% of Americans are loyal.
Advertising expenses have risen largely due to the fact that it
must pull a much bigger wagon.
Offering a unique selling proposition on a unique service costs
more, but it's money well spent.
The final reason is an awareness level exists, but nothing more.
This is the best example of why the independent "ma and pa"
retailer is vanishing in America.
Consumers who shop at a superstore or a new retail format drive
by many local retailers. When we ask them, why did they shop here
but drive by this locally-owned store, the answer is: "I have
heard of them, but I haven't been there for years," or "I
have heard of them, but I didn't realize they were still open".
These responses reveal that some awareness exists, and maybe prior
shopping experience, but these stores have been lost in the shuffle
and survive only as long as the owner is willing to devote his whole
life to the store.
Hopefully, when reading this analysis, you have noticed that many
of these five points are inter-related. Some could argue these five
points are actually versions of the same problem: A missed marketing
message to the desired customer.
The lessons to be learned are: What does it take to have a merchandising
offer or product area that is truly superior to your competitors
in the marketplace? And, what unique service will you offer that
gives the customer a reason to make you first on their shopping
By not fulfilling these two vital functions of either a retail
store or a manufacturer, your ability to be profitable long-term
This will be a year when more companies will face extinction because
they have this attitude: "Things will turn around, they always
With a shrinking pie due to consumers trying to save more, it may
be a long time before "it turns around".