What can you do to help your employees succeed? How can you capitalize off the trends in the home improvement industry? What can you do to set your business apart from your competitors?
Two retail experts, Dr. Kit Yarrow, a consumer psychologist, and Mary Walter, a leadership development coach and retail guru, are here to give answers to these questions, and many more.
Both Yarrow and Walter spoke at the North American Retail Hardware Association’s (NRHA) All-Industry Conference, held last month with the National Hardware Show® in Las Vegas.
Yarrow delivered a presentation called “Decoding the New Consumer Mind,” and Walter spoke about “Your Remarkable Service Advantage.”
The editors at Hardware Retailing spoke with Yarrow and Walter to gain some additional insight about what independent retailers can do to better reach their customers and bring in more sales. Read on to learn more about what they had to say.
Kit Yarrow, Ph. D.
Kit Yarrow, Ph.D., is an award-winning consumer psychologist, professor and consultant. She is the author of the best-selling book, Decoding the New Consumer Mind, and co-author of Gen BuY. She also writes about consumer behavior for Time and Money magazines. Yarrow is a recognized authority on the psychology of consumers and millennials.
Tell us a little about your background.
I got my Ph.D. in clinical psychology (and even worked as a therapist) while I was a professor of marketing. It hit me that what I really loved was psychological assessment and research, rather than therapy. Of course, I also loved teaching and marketing, and I was truly fortunate to work for a university that granted me a full professorship in both departments and permission to consult to businesses. I conducted consumer research for companies like General Electric and Del Monte while I was teaching. It’s thrilling and, I think, incredibly valuable, to apply clinical psychology to business issues.
What are some consumer behavior trends you’re seeing, especially as they apply to the different generations of shoppers?
There are so many. I think our use of technology has resulted in us thinking very differently—we process information differently than we used to. We have shorter attention spans, want immediate answers, prefer visual to written communication and so forth. In other words, we want real life to be as immediate and exciting as our virtual lives. And this isn’t just millennials; it’s everyone. Obviously, retail has to accommodate these psychological shifts to stay relevant. For example, retailers have to get much more visual, more turned in to the sensory side. That’s how people make decisions today when shopping. They aren’t going to read much in the store; they are more impatient than that. They’d rather get answers from visuals. The retail environment also has to be more stimulating.
Businesses that keep their product assortment fresh give customers reasons to come back, plus newness satisfies those shorter attention spans. Carrying products that are new, fresh and more exciting are hallmarks of the businesses consumers turn to over and over again. It doesn’t matter what you are selling—you have to engage your customers in more innovative ways than you did in the past.
Another shift is toward bargains. I think a lot of retailers are on the bargain bandwagon, thinking consumers want nothing but lower prices. If you look at it from a psychological prospective, yes, people do want to get a good deal, but they also use bargains as a rationalization to buy something, or as reassurance that they are being charged a fair price or because they feel like a winner when they score a bargain. Businesses can help people get those psychological goodies without always resorting to bargains. For example, they can offer exclusive, limited products.
How can independent home improvement retailers capitalize off of these trends?
There are a few action steps I would take. First, they should look at the store and see if there are any areas where they can remerchandise to make it easier for customers to learn about products, and to buy. Consumers are taking about 20 percent as much time as they did five years ago to look at a product and read and understand any associated signage. If something is too complicated or involves too much reading, it’s out. Signage should be quick to read, and the store’s layout should be intuitive.
The checkout process has to be easy, too. You don’t have to do what Apple does and offer checkout in the aisle—although if you can, that’s great—but you need to make checkout convenient for your customers. If you have a self-checkout, it must work every time. You don’t want customers looking for other options of where to shop because of one bad experience.
In short, retailers should aim to make their stores super-visual, easy to shop, reliable—your customers know you have the products they need—and exciting.
What else can retailers do to reach their customers?
They simply must offer an omnichannel experience. Consumers don’t differentiate their online and in-person lives—it’s all one world and one experience—and that’s how retailers have to be. People who love a particular shop want to be able to connect with that shop when they can’t get to it physically. So, even if it’s just an Amazon Marketplace or a Pinterest account with links, it’s important to be there for your customers.
Another thing they can do—and this should go without saying, but unfortunately it’s not as common as it should be—is just to remember common courtesies. Be nice. Consumers are more anxious, angry and guarded than ever. They may not look it, but they’re craving positive human connection. In addition to in-store courtesies and responsive online engagement, retailers that are engaged with their communities and causes stand out to consumers.
Mary Walter is a renowned retail expert and leadership coach. With more than 20 years of experience in helping managers become exceptional leaders, she has the secret to accelerating leaders’ development and transforming results. She serves clients with a focus on measurable change, and solutions that align with the business model and customer priorities.
Tell us a little about your background.
I’ve been very fortunate to work in many different retail business models. I spent 25 years leading teams in retail, at Macy’s, Target, Gap and Ross. I started out working in the stores as an assistant department manager, and eventually, I ran a national retail organization with 55,000 associates and $12 billion in sales.
Retail continues to be an exciting industry, and one that offers tremendous opportunity for personal and financial growth. We are in a people business, and people are constantly changing. We’ve recently seen customers shift their retail shopping with online retail increasing in market share, and some customer segments are moving spending from products to experiences.
The good news in retail is that customers will respond with loyalty when you meet their needs, both emotional and practical. Independent retailers are uniquely positioned to succeed in this environment.
What are the advantages independent retailers have compared to their competitors?
Customers today want it all—price, product, convenience, expertise and an authentic connection. While independent retailers cannot win at everything, one area the competitors can’t touch is an authentic connection with customers. This is a remarkable advantage. If I’m buying a hammer from you, I might buy it anywhere. But if I’m buying a hammer from a store where I like you, I like your team, I feel valued, I feel like you care that I shop here—now I’ll never buy a hammer anywhere else.
Expertise is another advantage that other retailers struggle to replicate. Customers at the independent home improvement store are often trying to fix a problem; retailers who them solve those problems will earn their loyalty and their dollars. While some larger retailers try to meet these needs, the in-store experience doesn’t often live up to their vision. Real-time advice and interaction requires real people with real expertise that is impossible to replicate online.
How can independent retailers make the most of these advantages?
Maximizing your advantage relies on your terrific team. Hiring employees first for attitude and second for expertise will ensure your success. Your team members are your key to success, so treating them as your greatest resource is critical. Recognition has been shown to increase employee engagement and effort, so find creative ways to thank them.
Treating customers as valued guests by greeting them warmly when they enter your store, and investing in salesfloor staffing to provide expert advice will differentiate you from the competition, and make the most of your advantage. Great service is so rare today, as many big-box retailers have cut staff and training; your commitment to service will stand out amongst your competition.
You provide leadership coaching. How can independent home improvement retailers recognize potential leaders in their businesses?
Every boss should know what is important to each person on their team. Truly knowing an employee’s ambitions, goals, motivations and even fears allows you to match your leadership approach to the individual. This knowledge also reveals which employees have an interest for personal growth and advancement, which is the best criteria for development success.
Of course, strong performance is required. Watching for great performance is perhaps the best way to identify your stars. An associate who delivers great results is one who likely has drive, service orientation, and the work ethic needed to advance.
What can retailers do to help those employees develop their leadership potential?
We can all grow into great leaders. Leadership is not a talent that is granted at birth; it can be learned like any technical skill. Imagine your associate in the next job. Where will they struggle? What will be a challenge for them, either in technical knowledge or from a leadership perspective? Acknowledging where we have opportunity to grow is half the work of making a change. Once you’ve identified where an employee needs to grow to develop those skills, make a plan with them to get there.
Development plans are best when they are tied to the work itself. For instance, if an associate needs to work on communication skills, they can practice by training the rest of the team. If they need to develop conflict management skills, have them give feedback (both positive and constructive) to new associates. Your commitment to developing your associates will not only develop your future managers, but earn you the loyalty and commitment of your team. One of the biggest privileges and joys of being the boss is helping others to realize their goals.