The Secret of Story-Based Retailing
In the new experience economy, the very idea of what a store is has changed. It’s transformed from a place for people to buy things into a place where people engage in shopping experiences of discovery and delight where product is the reward they take home.
Under this new retail experientially-focused model, the old “product is king” approach is dead. Today the retailer must put the customer, not product, at the heart of every activity and objective. Now the “customer is king” and the retail store his or her “castle.”
Retailers are discovering the way to move from a product-centric to a consumer-centric retail model is through storytelling. Timberland is doing it with its TreeLab concept where every 6-to-8 weeks the TreeLab store is made over to tell a new story with a curated selection of Timberland products elements in that story, like Streetology about its styles for city living, Shevolution for women and now Made to Give for holiday gifting.
And fashion retailer White House Black Market which specializes in shade variations in its signature black-and-white theme is doing it by adding a rotating selection of accents color to make those basic black-and-white fashions pop.
But perhaps the most story-intensive retailer is NYC’s STORY Store, on 10th Avenue in the Chelsea district. Founded by Rachel Shechtman, STORY is described as “Point of view of a Magazine, Changes like a Gallery, Sells things like a Store.” Every 4-to-8 weeks the store reboots to bring in a whole new range of merchandise to tell a new story.
The STORY Store has become a mecca for retailers large and small, looking to understand the fundamentals of retail storytelling. Back in 2014 Target CEO Brian Cornell came calling and his learnings are starting to show in initiatives like Target’s next generation store concept.
Today retailers must focus on the customers and the stories they want to hear. Yet, as Kyle Murray, Professor of Marketing and the Director of the School of Retailing at the Alberta School of Business, writes in The Retail Value Proposition, “Most retailers remain merchants at heart. They focus on selling merchandise, rather than managing customers.” And no one in the retail organization is so focused on selling merchandise than the merchandiser.
In today’s experiential retail world, the traditional role of merchandiser has been disrupted. Populating the store with new merchandise is only part of the merchandiser’s responsibilities. The more important part is to present the merchandise is such a way that it draws the customer in, engages their imagination and compels them to buy.
The merchandiser today has to evolve from merely selecting new product and making sure it is in the right store locations to one of creating and arranging the products into visually, imaginative and engaging ways. Merchandisers must become curators who expertly tell stories with merchandise that connects with the needs, desires and most importantly the imagination of the customer.
Merchandisers must become master storytellers. Here are secrets of how to evolve into a story-based retailer:
Today the merchandiser must bring a whole new set of skills to the job. The merchandiser must be both style maker and data/tech savvy. “Merchandisers must have a high level of taste, sense of style and supreme self-confidence balanced with emotional intelligence,” says a member of the leadership team at a well-known, multi-national retailer. But, he says, “Those people skills, taste, style and charisma can’t be taught.”
On the other hand, the science of merchandising can. “I need full financial visibility of my business at all times. What is selling, where it is selling, who is selling it and I need it in one place in a financial reporting system that tells me what is going on in my business,” he says.
Finding these often conflicting skill sets, the intuitive and the analytical, in one person can be challenging and successfully managing cross-functional teams with one group operating intuitively and another analytically is even more so. “Many merchants have people on their team who’ve been in their roles 20+ years,” says Shelley Kohan, retail fellow at RetailNext, an IoT integrated platform that brings e-commerce style shopper analytics to brick-and-mortar retailers.
“Merchandise planning is sometimes too focused on numbers,” notes Peter Charness, SVP America’s TXT Retail, an Aptos Company, which provides software for merchandising and assortment planning. He recognizes that such systems tend to favor the analytically-focused merchandisers.
Rather, he says, merchandisers must always keep in mind who they are buying for, what the store looks like and how to tell the right story with merchandise. “It’s important for today’s merchandisers to be able to use the tools that get the numbers right and to get the visuals right too.”
Recognizing that a picture is worth a thousand words, or data points plotted on a spreadsheet, TXT Retail has added visuals to its product database to bridge the gap between the data analytics and the intuitive. This allows merchandisers to curate selections, not just pick a description off a spread sheet.
The ultimate value of such data-analytic tools is to give merchandisers a store-by-store view of the merchandising stories that are selling to help them understand the customer needs at the shop level, which can make the difference between success and failure for each assortment.
“Back in the day if you had stores two miles apart, you’d buy the same product for both stores. They’re the same market, right?” says Kohan. “But now with analytics and enabling technology, you discover the store located two miles south of the other one has a very different customer. This particular product I’m considering will work will in one, but not the other. Now we can make pinpoint decisions about what will sell and where.”
What’s selling here, what’s selling there
And curating merchandisers need to know not only what’s selling in their own stores, but also what’s selling at the store next door, across town and around the world. It’s the insight on which strategies to attract new customers is based. For fashion merchandisers, that’s the role that retail analytics company EDITED is filling.
“We built a portal that tracks every fashion retail site,” explains Katie Smith, senior analyst at EDITED. “It gives us a view of what’s going on in the apparel market worldwide. We categorize and analyze over 660 million SKUs and are adding an extra half a million every week, so we’re tracking what’s going on globally in apparel retail across men’s, women’s, children’s wear from low-end fast fashion right through luxury high-end.”
“There is a critical need for speed to market,” Smith continues. “Merchandisers have new frustrations and added pressures layered on top of their traditional numbers-focused and spreadsheet-driven roles. With fashion trends moving so much faster and the changing ways customers discover product, it’s disrupted all the roles within this industry.”
Tell the story, sell the story
The evolving role of merchandiser is to tell the story and sell the story with merchandise. It’s not just managing product and inventory, placing orders, allocating merchandise and moving it through internal systems. It’s being able to combine all those moving parts into a story-based product experience that captures the imagination of the customer, entices them to shop and compels them to buy.
“Merchandisers can’t stick to their formulaic structures and old ways of doing things. They have to deliver that mystery ingredient, which is customer delight,” Smith says. “If a retailer’s story isn’t being communicated through product, no amount of clever promotions or perfectly timed drops are going to get that product to sell.”
Curating stories, where each individual product becomes an element of a bigger story is what merchandisers must do, rather than just finding, buying and shipping out product. “Today’s shopper is no longer willing to simply trade dollar for product. They want that added experience. They want that added value. They want that story,” Kohan says.
The result of successful story telling will be both delight for the customers, and delight for the merchandisers and the company managers they report to. “Enlightened retailers must create shopping experiences that reward the customer, that delight the shopper. Retailers are busy putting together a brand story and experiences that attracts the shopper, but the story isn’t complete until the merchandise is in the shoppers’ hand. That’s a happy ending for the shopper and retailer,” Charness concludes.