When I first began my professional career I was absolutely intrigued with marketing. I still am. One of my first lessons is that marketing revolves around the customer; not necessarily the product. What does the customer want—what is the customer actually buying—that’s the key question. Customers that want GoPro cameras are not buying a video camera; they’re buying the adventurous lifestyle; they’re joining the adrenaline rushing international community.
We have spoken about ecommerce and the competition that those companies provide to traditional retailers across all industries. Let’s look at why those companies have been succeeding in earning the customer’s money. The ecommerce goods sold aren’t always less money (in the case of furniture typically ecommerce accounts are more expensive than traditional furniture stores). Yet ecommerce is growing in the furniture industry.
From my perspective there are two factors that have led to the emergence of ecommerce: The first is convenience. The second is trust.
Regarding convenience, the ecommerce accounts have made it so easy for customers to search (even now through image and video recognition) click, buy and have the goods delivered to one’s dwelling quickly. If there’s a return—no problem the ecommerce account will coordinate it all. This saves the customer countless hours of re-search, finding exactly what they want, and overall dealing with the hassle of other people. It’s that easy for the customer.
For trust there are two elements. First people trust that packages ordered from Amazon will arrive promptly and be exactly what they wanted. Same goes for Wayfair, Hayneedle, Overstock, and others. Customers have been conditioned to trust that the goods ordered from these sites are the same quality that they can buy in stores.
The other aspect is the peer review. Before making a buying decision customers are able to see what other people have said about the products. This social review is critical in a buying decision—a non-partisan, honest review from a fellow customer is providing their experience of the product and the company. That’s something that has not been replicated in traditional stores.
While those two aspects have led to a customer dollars going online, there’s still a strong place for traditional retail. The ability to actually see, touch, try out and even customize products is much easier done in store than online. The novelty of working face to face with person-able experts in their field is still more powerful than seeing an image online. You can read about many brands that, despite being ecommerce/technology focused businesses, have really embraced the personal interaction aspect of retail. A couple that come to mind immediately are Bonobos in menswear and Warby-Parker for eye glasses.
There appears to be a desperation in the furniture industry that retail is moving quickly online. Before making haste decisions on what actions your company needs to make, answer the question “Why will customers choose to do business with you versus any and every possible alternative?” There are inherent advantages to brick and mortar as there are inherent advantages to online only. By understanding what your company really provides to your customer base, your unique selling proposition, will help you craft a success plan for 2018 going forward.