How to Write an Effective Retail Strategy
Are you looking to take your retail business up a notch? If so, you’re in the right place. In this blog post, we’ll share a few ways to optimize your retail strategy. From utilizing social media platforms to analyzing customer data, we’ve got you covered. So what are you waiting for? Let’s get started!
What is a Retail Strategy?
A retail strategy is a plan that retailers use to increase sales, gain market share, and improve customer service. This includes setting goals, analyzing the competition, and developing marketing and advertising campaigns.
Retailers also use the strategy to choose the right mix of products and services to offer and to price those products and services competitively.
Some customers may research a product on their smartphone, add it to their shopping cart, and then complete the transaction when they’re in front of their desktop.
This smooth transition from one platform to another is at the heart of an omnichannel customer experience.
A customer might try on clothes in a store, but not be able to find the right shade or fit. Having the ability to quickly ship out an item that a customer orders can make or break a sale.
Another way to look at it is from the viewpoint of direct-to-consumer retailers such as Outdoor Voices.
This way the retailer can keep in touch with their customers and promote new products, while also saving them time by not having to check stock levels.
The Importance of Customer Service
It’s important to keep shoppers engaged on one channel or with a seamless experience across channels to get them further down the funnel faster.
All online retailers want their visitors to stay on their sites as long as possible because any distraction could lead to confusion, and result in cart abandonment.
One of the biggest goals of an omnichannel strategy is not to disrupt the customer experience.
Customers don’t want to browse items on a store’s site, have a question about them, and then have to sit through 30 minutes of hold time just to speak to a representative.
If you want to keep shoppers from getting frustrated and leaving your site, make sure you have customer service available on chat to answer any questions they may have. This way, they can get the help they need in real-time.
What is Customer Service?
More than price or product, great customer service is what drives customers back.
A retail company’s marketing strategy involves two parts: the aspects of business that you can directly control and those that you have to adapt to.
Uncontrollable variables are factors you can’t control, such as the weather. Controllable factors are ones you can, such as your attitude.
When devising a strategy, it is important to take both controllable and uncontrollable variables into account. Having access to accurate data can help retailers anticipate the effects of these variables and make more informed decisions.
The controllable components of a retail strategy include store location, business management, merchandise management, pricing, and customer communication.
Store Location. A retail company needs to decide whether to use a physical store or a non-store format. For brick-and-mortar stores, you must decide on a location and specific site. Factors such as competitors, access to public transportation, and the density of population are taken into consideration when selecting a store location.
After going over the rental terms, a decision must be made on whether to expand or remain in one location. If expanding, then multiple sites may be looked into.
Business Management. Human resources and operations management are two important parts of running a business. Tasks, policies, resources, and responsibilities are outlined in a retail org structure.
Human resource management involves practices such as hiring, training, compensation, and supervision. Job descriptions and responsibilities of all personnel are laid out so that everyone is on the same wavelength and knows what is expected of them.
The tasks involved in satisfying customers, employees, and managers are overseen by business operations. The financial aspects include managing assets, allocating budgets, and tracking resources.
Other considerations for effective retail store operations involve the physical layout of the store and its size, the staffing of the location, the upkeep of the space, energy management, store security, insurance coverage, and credit and crisis management.
Merchandise Management. Decisions on the width of your product range (number of categories) and the depth of your assortment (number of varieties per category).
Every company has its own set of policies for procurement. The criteria they use for deciding how often to buy, what the terms will be, and which supplier they will use are all set. Their forecasting, budgeting, and accounting systems are also laid out, as is the amount of stock they will keep for each item.
The success of an item sold by the retailer must be assessed to determine what items to purchase in the future. This assessment is also important for setting pricing.
Pricing. A business has several options when setting a price for its products, and will choose a price that aligns with its brand image and the quality of the goods.
Markdowns are planned ahead of time: when products will be discounted and by how much.
Customer Communication. What physical characteristics of retail stores or their surrounding areas affect consumers’ perceptions of them?
The first impression of your business is the physical storefront. This should not be underestimated.
A retail store’s image is shaped by many factors, such as the layout, display, and color scheme of the store. Customer service, employee attitude, and community relationships are also factors that can influence a retail brand.
Promotional tools are an excellent way to improve sales performance and engagement. Whether it’s simple, inexpensive flyers for a takeout place or a national advertising campaign for a major franchise, these tools can greatly impact your retail sales.
There are three ways to promote a product: advertisements, personal selling, and promotions. A business can get positive press through print, television, and blogs.
While you can control some aspects of your retail strategy, there are also some uncontrollable variables to keep in mind.
The uncontrollable aspects of your strategy include consumer preferences, competitors, technological advances, economic fluctuations, seasonal changes, and changes in legal regulations.
The most successful businesses plan ahead, taking future changes into account. This allows them to stay ahead of the competition and maintain a strong market position.
Consumer Preferences. A skilled business knows that it cannot change demographics or lifestyles, force consumers to buy things, or dictate what they should buy. Instead, it listens to what its customers want and develops a strategy based on those needs.
You cannot sell products and services that are out of your customers’ budget, are not wanted, and are not advertised properly.
Competition. Retailers have little to no control over who enters their market. In fact, a retailer’s success may cause competitors to reevaluate their strategies to capitalize on their popularity.
Because of this, it’s vital for a company to consistently evaluate its strategy and market position. This should include its target audience and product selection, to ensure it remains competitive.
A continuing commitment to satisfying your customers better than anyone else is pivotal.
If you own a supermarket, then perishables at Target, home cleaning supplies by Staples, and home delivery of groceries by AmazonFresh are all competitive threats to your retail organization.
Technology. Computers have come a long way, making it easier to keep track of inventory and sales. There are now many ways to store and transport merchandise using high-tech methods.
Toll-free numbers are still a popular option for consumers to call to order products. And, obviously, there is the Internet.
Nonetheless, some advancements may be too expensive for small retailers.
Although smaller businesses may have automated check-out counters, they will probably still be less efficient than bigger companies. This is because they will have less sophisticated inventory management systems in place.
They must provide better service by adapting to their customers’ individual needs.
Economy. Unfortunately, economic conditions are out of any retailers’ hands, no matter how much money they have.
Economic factors such as unemployment, interest rate, and annual GDP growth all affect a retailer’s bottom line.
In outlining its strategy for weathering tough times, a retail company should consider its forecast of national and international, as well as state and local, economic conditions.
Seasonal Changes. One potential obstacle that some retailers face is seasonality. Sales forecasts can be thrown off by unpredictable changes in the weather.
Businesses that sell sporting goods, fresh food, and travel services are at the mercy of good or bad weather.
They can offer a variety of goods and services that are popular at different times of the year.
A sports store can stock a variety of goods that appeal to customers during different times of the year. For example, they can sell skis and snowboards in the winter months, golf clubs and tennis rackets in the spring, snorkels and fishing rods in the summer, and basketballs and footballs in the fall.
By stocking these seasonal items, a sports shop can better meet its customers’ demands.
Legal Restrictions. Any business that crosses a state line is subject to federal laws and regulations such as the Sherman Act, the Clayton Act, and Robinson-Patman Act. These laws protect consumers from unfair trade practices and unjust merchandise discounts that could adversely affect small businesses.
At the local and state level, there are often zoning laws that restrict where retail businesses can operate. These regulations often require that buildings meet specific standards.
Many states impose blue laws, which limit when businesses can open. These laws are put in place to protect consumers from certain situations, such as construction, when it may be dangerous to be out in public.
Some businesses are required to secure a state or city-issued license to operate.
Integrating Overall Retail Strategy
Now that you have a mission, management style, and product niche, it’s time to create an overall retail strategy.
A clear goal has been defined and your target market has been researched.
You’ve made decisions about your store’s location and management, as well as merchandising and pricing.
These various factors must all be taken into account and properly managed to ensure a consistent, effective strategy.
How to Form Successful Retail Marketing Strategies
As a small business, it is important to have an advertising and marketing strategy in place to reach your target audience. There are several marketing strategies that you can use, and it is important to choose the ones that will work best for your business.
You can use traditional methods such as print ads and television commercials, or you can use more modern methods such as social media marketing and email marketing. Whichever methods you choose, make sure that you are consistent with your message and that you are reaching your target customers.
Retail marketing strategies should be designed to engage shoppers and build customer loyalty. In today’s high-tech world, this is more important than ever before. A successful strategy will result in customers who not only make a purchase but continue to do so over time.
As you develop your strategy for reaching your retail sales objectives, keep your business objectives in mind so you don’t veer away from your retail goals.
What Components Make Up a Retail Strategy?
What Are the Steps to Creating a Successful Retail Strategy?
Why is Creating a Retail Strategy So Important?
There you have it! Ways to optimize your retail strategy. We hope you found this blog post helpful and that you’ll be able to put these tips into action in order to take your business up a notch. Thanks for reading!