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7575 Paragon Road, Dayton, Ohio 45459Phone: 937.439.4400 Fax: 937.439.4340Email: firstname.lastname@example.orgBranch Ofces: London,Los Angeles, New York, Paris,San FranciscoD. Lee Carpenter, Chairman & CEOJill Davis, EditorMeredith Patrick, Design/ProductionFor more inormation or to be placedon our mailing list, visit out website,www.designorum.comand complete the contact orm.Reprints o articles or excerpts without the express written permissiono Design Forum is prohibited.Ideations is printed bimonthly.Subscriptions: $125 annually in the U.S.;$150 elsewhere.© May/June 2008
Preparing for Good Times
After the end of what felt like the lengthiestprimary season ever, we’ve nally narroweddown the presidential candidates. You couldalmost hear the country’s collective sigh of relief. Now the race can focus while we get ahandle on some clear objectives from thenominees. People are ready for change. Theyrespond to clean, simple messages. Retailworks the same way.Shoppers look across the eld of retail optionsto judge which brand propositions relate mostclosely to themselves and their values. They weigh the experienceand narrow their choices. Clear alternatives are more important tothem now, given the burdens of time constraints, economicpressures and the uncertain future. Smart companies will nd thecapital to explore opportunities for connecting with customersduring this transitional time. And it won’t be by copycatting. Retailbrands need to look, feel, sound and smellcompletely different from their competitors.
It needs to be a clear choice.
Shoppers expect retailers to understand their needs, and right nowthey need lower prices. However, when
competes onprice, consumers become more particular. And they are much lesstolerant of poor service and indifferent shopping experiences.The Home Depot sees the current economic downturn as a time of lower risk. It is investing $3 billion over two years to develop newsystems, store improvements, and the hiring of skilled associates.CEO Frank Blake nds that this is one of the rare times a companyas large as his is willing to accept and push for change, because theupside is so clear. The plan is to renovate stores for easiernavigation, and add more training to turn around Home Depot’sreputation for poor customer service. When the economy picks upagain, ush customers will be able to speak with knowledgeabletradespeople and rest assured the merchandise they are looking foris in stock. I noticed the company didn’t share any plans to cutprices, only to improve experience.Most bricks-and-clicks retailers are part of the social web throughcustomer reviews. If you have yet to establish an ongoing conversationwith customers through your website or marketing research efforts,now’s the time to initiate one. Ask consumers what they like/want/needvia shopping intercepts and interviews, using the sophisticatedtechniques available today for pinpointing robust, actionable insights.It’s a great time to get back some of your entrepreneurial spirit and usenew knowledge to innovate around the store.Although it is often accused of being stodgy, Wal-Mart has been one of the most aggressive retailers in terms of renovating and testing newstore experiences and conversing with customers. There’s a Wal-Martblog! Most recently, the company took a few knocks for theirlackluster fashion apparel launch, and it’s still low on the fashionlearning curve. But it has taken a stand in consumer electronics,completing a department redesign in stores nationwide that addressescustomers’ issues with its merchandising. Bentonville is also at workintegrating the online experience in the store, at the shopper’s request.And of course, it made headlines for leading the
way on green through energy conservation, and
are now in hot pursuit of sustainable packaging.We’re in a bi-polar economy. It’s a difcult market right now and atthe same time it’s not. When you look across all categories, forinstance, home-related stores are most affected and apparel is slowingdown, but some categories like supermarkets and value stores are
Drop prices if you must, but heighten the experience absolutely.Remember, strapped for cash or not, people still choose based onemotion and they shop with a sense of anticipation and fun. We’re in aslowdown, not a recession. Take the optimistic view on the long term,and invest now in the store experience so you can come out aheadwhen things turn around. I’ve heard it said, and from thirty years’experience I wholeheartedly agree: a slowdown is a terrible thing to
Thoughtfully,D. Lee Carpenter
Chairman & CEO