Specialty Retailers Today Face a Challenging Business and Competitive Environment: New Unity Marketing Study Offers Research-Based Solutions to Retailing Challenges

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In a keynote address entitled "Declaration of Independents" at the 11th Annual Gift & Home Trade Association Conference, Pam Danziger, Unity Marketing, announced results of a survey among 350 independent specialty retailers. The results of this study help retailers be more successful, invest wisely in marketing and advertising and be more creative in putting internet tools like social media to work to promote the business.

Pamela N. Danziger, Unity Marketing

In today’s retailing market, success is not about the merchandise, i.e. what you sell, but the merchandising or how you sell it. Retailers need to position their store around the experiences delivered to the customer.

In a keynote address at the 11th Annual Gift & Home Trade Association Conference, Pam Danziger, president of Unity Marketing, told the audience of gift industry executives that specialty independent retailers today face a challenging business and competitive environment, but that they also have the tools, skills and attitudes to stare down those challenges if they market smart, connect with the customers and deliver a truly exceptional shopping experience in their store.

“Specialty retailers don’t need a lot of money to invest in marketing and advertising, rather they need to focus on marketing more effectively and to put the power of word-of-mouth marketing to work to tell the story of their store,” Danziger said in the October 3 presentation.

Tale of Two Stores Facing Same Business Challenges, but Responding in Vastly Different Ways

To illustrate, Danziger shared the story of two independent specialty retailers in West Reading, PA, a 5-block main street district packed full of specialty independent retailers, as well as a thriving dining community. West Reading draws upon a strong base of highly affluent customers in the adjacent Wyomissing, PA neighborhood and is within walking distance of Berks County’s largest employer, the Reading Hospital and Medical Center.

“From all appearances, West Reading is a great place to locate a specialty retail store. But on September 12 the Reading Eagle reported that Allegro Arts & Custom Framing was closing,” Danziger said. “The article blamed all the usual suspects for the store’s failure, including declining foot traffic, rising cost of operation and the fact that, as the owner states, ‘Framing is not something you need and when a husband or a wife gets laid off, they aren't thinking of getting something framed.’ Basically this failed retailer put the blame on factors completely beyond his control.”

But right down the street and facing the exact same business stresses is a little shop named Hello Bluebird. Just like Allegro, Hello Bluebird sells stuff that ‘nobody needs,’ but this store is different – it sells more than just things, it delivers an experience to the customers. Danziger explains, “What captured my attention is that Hello Bluebird hosts wine walks to visit the restaurants on the street. Now, in Pennsylvania no retail store can sell wine, so these wine walks are offered simply as a way to interest the customers and get them talking. As a specialty independent retailer, Hello Bluebird’s owner, Alex McCarty has imprinted her personality on the store and the things she sells. She uses Facebook and Pinterest to share her vision, and builds displays that tell a story for the customer and that invite the customer to become part of that story by picking something up and buying it.”

“Allegro failed because it was just in the business of selling products, while Hello Bluebird is delivering customer experiences through the things it sells,” Danziger explained. “Allegro’s website shouted about its being a source for custom framing one can trust, but didn’t prove it with testimonials or real-life examples. Hello Bluebird presents unique products in creative ways backed up by values that engage and connect with the customer, as the website states ‘Hello Bluebird’s shelves are chock full with an eclectic blend of handcrafted, eco-friendly and socially-conscious goods. In short, we sell lovely things made by good people.’”

“In today’s retailing market, success is not about the merchandise, i.e. what you sell, but the merchandising or how you sell it. For example, calling yours a gift store or framing store, home furnishings store, kitchen store or clothing store isn’t good enough today. That tells only what you sell, not what you can do for the customer. Retailers need to classify and position the store around what special, unique experiences they deliver to the customer. Retailers need to go beyond the things to the customer’s experience and back it up by personal values,” Danziger says.

For example, Danziger points to a Berks-County specialty pet retailer, Godfrey’s Welcome to Dogdom. Godfrey’s is much more than a place to buy dog ‘stuff,’ it is a destination that celebrates and enhances the quality of the ‘canine lifestyle.’ As the website states, “Godfrey’s is truly a celebration of dogs in our lives. We live and believe in a happy canine lifestyle, where dogs are truly members of the family. We embrace our responsibility to care for their minds, bodies and spirits in the absolute best way possible.”

More about the study, "A Declaration of Independents: A State of the Specialty Independent Retailer Market”

If you are with a company that sells to specialty independent retailers, this 48-page report will talk directly to the needs of your core customers. In a survey conducted in July and August 2013, a total of 350 specialty independent retailers representing a geographical cross section of stores, were surveyed. Data was gathered about:

  • Type of store and store demographics: Learn how the label used to describe the store may be hurting sales and opportunities to grow business
  • Revenues & growth: Track where the store fits into the industry, how much bigger or smaller one's store, one's budget, staffing, investment in advertising and marketing
  • Business challenges, opportunities: Compare the challenges facing retailers. Find out ways to take advantage of the opportunities available to grow business via specialty retailers
  • Competitive environment & competitors' advantages: Who are specialty retailers’ key competitors and what are their advantages. Learn how to make the most of each store's unique strengths.
  • Marketing, advertising, public relations: The Small Business Administration recommends that small businesses invest 7-8% of sales to marketing. Nobody in specialty retail can do that. Learn more about cost-effective ways to market and promote the retail business that don't cost a lot of money, just creativity and strategic thinking.
  • How retailers are using internet, website, social media: The survey points to where retailers should invest their time and money on the internet to gain the greatest success in reaching and connecting with new and current customers.
  • Retailers' sales partners & how they can help retailers, with advice and recommendations for product vendors, sales representatives and trade shows

The results of this study help identify specialty retailer’s strengths, weaknesses, opportunities and threats. The survey’s analysis and author, Pam Danziger, points to key take action steps derived from the research-based findings that will help retailers and their partners be more successful, invest wisely in marketing and advertising, and be more creative in putting the many internet tools to work to promote the retailer’s business.

Click this link to learn more about A Declaration of Independents retailer study.

About Pam Danziger and Unity Marketing

Pamela N. Danziger is an internationally recognized expert specializing in consumer insights for marketers targeting the affluent consumer. She is president of Unity Marketing, a marketing consulting firm she founded in 1992. Pam received the 2007 Global Luxury Award for top luxury industry achievers presented at the Global Luxury Forum by Harper's Bazaar. Luxury Daily named Pam to its list of "Women to Watch in 2013."

Pam's latest book is Putting the Luxe Back in Luxury: How new consumer values are redefining the way we market luxury (Paramount Market Publishing, 2011). Her other books include Shopping: Why We Love It and How Retailers Can Create the Ultimate Customer Experience, published by Kaplan Publishing in October 2006; Let Them Eat Cake: Marketing Luxury to the Masses-as well as the Classes, (Dearborn Trade Publishing) and Why People Buy Things They Don't Need: Understanding and Predicting Consumer Behavior (Chicago: Dearborn Trade Publishing, 2004).

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Greg Danziger
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