What small and independent retailers can learn from baseball stats.

It's finally April and the start of another baseball season. Football may be our most popular game, but baseball is our national pastime, and the start of every new season brings with it essays and odes to the game.

This week, CBS's 60 Minutes ran their own feature to mark the new season, a profile on Bill James. For the uninitiated, James is one of the game's most creative and influential statisticians, and has been credited with changing many long-held beliefs about how to evaluate players and think about the game. He started out over 30 years ago, writing and self-publishing an annual statistical abstract for each coming season. Today he works for the Boston Red Sox, and his approach to statistical analysis has been almost universally accepted and adopted throughout the game.

James' essential insight was that looking at baseball through in-depth analysis of the statistical data could shed new light on old preconceptions, and tell a story of what's happening on the field, and why, far beyond what the eyes of players, managers, executives and fans actually were seeing. He demonstrated, for instance, that slugging percentage and on-base percentage were far more accurate predictors of on-field success than the traditional statistics of batting average, home runs and runs batted in.

Continue reading "A Numbers Game"

Engaging customers can make your store more than just a place to buy things.

In 1989, Steve Wynn opened the Mirage Hotel and Resort in Las Vegas, the first new resort on the Strip in 16 years. As recounted in a recent PBS documentary, "Las Vegas, An Unconventional History," this represented a critical turning point in the history of Las Vegas. Mr. Wynn was quoted at the time as saying, “They don't need another casino… but they could sure as hell use a major attraction." Or as Brian Greenspun, editor of the Las Vegas Sun, says in the documentary, "Steve came and he realized that if you build it, and you build it better and you create a little demand where maybe there wasn't demand … everyone will want to get into it.”

Give them something they haven't experienced before. Give them an experience that's new, fresh, and exciting. The story of the Mirage in Las Vegas is, at heart, a story about retailing, about differentiating and growing business by creating a unique, compelling shopping experience.

Retailers have long understood that doing business is much more than just selling things to customers. Every cosmetics salesperson understands that they're not selling make-up, they're selling glamour. And retailers have long sought to create compelling presentations and experiences to capture customer’s attention.

Continue reading "Create a Retail Experience"

With Big Box stores in clearance mode, smaller retailers can no longer compete for holiday shoppers on price alone.

The holiday selling season is behind us, and as small and independent retailers work through their customer returns and gift cards and clearance sales, it's not too early to be thinking ahead to next year. For many, this was an unsettling season, as customers waited longer and longer to shop, and established selling patterns seemed to shift.

National retail sales between Thanksgiving and Christmas this year were projected to be up just 3.6% over the prior year, compared to 6.6 percent in 2006 and 8.7 percent in 2005. Many experts have attributed the softness to a weakening economy. But there was something different about this year, far more different than just weaker sales.

A week after Black Friday, I came upon the Kohl's circular for the week. They were promoting their 50 percent off sale, and as I paged through it, I was struck by how category after category was included in the sale. Not just items, but whole categories. The week after Thanksgiving, Kohl's was transitioning into full clearance mode.

Continue reading "An Unsettling Season"

Even in a niche market, a well-planned expansion of consumer choices can reveal demand that was otherwise hidden -- and drive sales.

In his bestselling book "The Long Tail," Chris Anderson explored the emerging economic phenomenon observed in the on-line book, DVD, and music businesses. As the costs of production, distribution, and inventory have declined, while the assortment of available titles expanded almost exponentially, consumers embraced the choices available to them. The subtitle of his book, "Why the Future of Business is Selling Less of More," is a call to independent retailers that the future is to be found in capitalizing on consumers developing desire for an ever-expanding assortment of specialized, niche products.

The economic insight in "The Long Tail" is derived from studying a business such as Amazon.com. As Amazon was able dramatically expand the assortment it offered its customers in categories such as books, DVDs and music, the total volume of the business done by the thousands of titles that sold relatively few units rivaled the business done by the relatively few hits. When given near-complete choice, customers demand was not concentrated around the few hits, but extended to almost every title offered. The same sales pattern was found in such online businesses as Netflix and Rhapsody.

Continue reading "The Long Tail of Retailing"

Looking for new ideas to keep your store fresh and dynamic? Time to go shopping.

I admit it. I'm absolutely no fun to go shopping with.

The reason is simple. I'm not like other shoppers. I'm not like the mother out looking for the bargain for her family, or the kids looking for something exciting to catch their attention, or the dad on a mission to bring home the perfect gift. When I go shopping, I tend to see things a little differently than other shoppers. I tend to stop and linger on things, and make comments about things, that make little sense to whomever I'm with.

I'm a retailer, a retail consultant specifically, a student of retailing. I simply can't walk by a store, much less into a store, without trying to figure out what makes that store tick, how customers perceive the store, what that store does well, and what I can learn from them.

Continue reading "Studying Your Competitors"