To Win at Retail, You Have to Understand Social Change

sourcingjournalonline.com /retail-reinvention-women-wealth-web-paco-underhill/

11/24/2017

Just completed a complete store redesign, visual merchandising overhaul or app update? Great. It’s time to start
all over again.

With consumers shopping 24 hours a day and tech companies churning out new operating systems around the
clock, stores have to be dynamic and flexible.

“Retail is one of the fundamental dipsticks of social change, and social change is in a state of acceleration and
you see it from Wall street to Main Street,” said Paco Underhill, founder of consumer behavior consultancy
Envirosell. “Shopping will change more in the next five years than it did in the previous 100.”

In his Science of Shopping events, Underhill advises retail executives on a wide array of ways in which they
need to reassess their businesses if they’ll have any hope of keeping up with the moving target that is today’s
customer. In February, he’ll partner with LIM College for an event that highlights how stores need to adapt right
now. And it starts, he said, with women, wealth and the web.

Women
Marketers are lagging behind when it comes to 50 percent of the planet. With ad agencies and retailers often run
by men, they’re still learning how to cater to women whose status in society has undergone a huge evolution.

No longer just the key demographic for dishwashing liquid and mascara, women are now in the market for pretty
much anything a man is—but that doesn’t mean you should talk to her like a man.

Using the example of consumer electronics, Underhill said while guys might geek out over a list of technical
attributes, that’s not what’s going to close the sale for most women. “They’re buying based on the impact on their
lives not tech specs,” he said. “Selling to women is about what the capabilities are and aligning those with her
lifestyle.”
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And when considering how she lives, retailers must reevaluate the very ways in which their stores operate.
Consider the life of a working mom. There’s no more time-strapped creature on the planet. She holds the family
together and its purse strings. But too often, Underhill said, stores are not designed with her in mind.

“Most parking lots tend to be passive rather than active and in other parts of the world they’re more dynamic,” he
said. “The idea of getting you in and out quickly isn’t just about the store.”

And it seems some retailers have finally gotten that memo. Nordstrom is offering 24/7 curb-side pickup this
holiday so no one has an excuse for showing up to any festive gatherings empty handed. Similarly, Walmart has
created an express lane for easy in-store returns that is tied to the big-box chain’s app so shoppers can start the
return process before even entering the premises.

Wealth
Retailers are also living in a bygone era when it comes to another population as well.

Once upon a time, wealthy consumers came from families who had had serious money for generations. That
began to fall away in the mid 90s with the rise of more self-made men and women, Underhill said. And with them
came a new reality.

“Now, more than 80 percent of global wealth is in the hands of people who earned it in their lifetimes,” he said,
adding there’s a good chance this new consumer isn’t as well versed in the finer things. “It challenges us to
understand that to make the sale, we have to provide an education.”

The biggest lesson for some will be why goods that look similar at first glance have wildly different price tags. It’s
a particular challenge for the U.S. given how price sensitive consumers are today, not to mention how little time
retailers have to convey brand and product messaging to on-the-go shoppers.

[Read more about educating consumers: Premium Fibers Defy the Race to the Bottom]

That’s where the Internet comes in. Underhill advises merchants to remember how much “preshopping” happens
online and to use it to their advantage. On their sites, stores can tout product attributes in a more detailed way
than they can in the store, he said. But once a consumer is in those four walls, salespeople must be ready to
encourage shoppers to employ all of their senses so they get a better understanding of the role that things like
fabrication and construction play in the look, feel and longevity of the garments.

The Web
Another way in which stores need to catch up is by embracing technology—specifically mobile devices. Rather
than fighting against them for fear customers are doing things like they won’t like, like price shopping, Underhill
said more stores must find ways to use them to their advantage.

“The phone as everyone’s personal shopping system is here to stay for the foreseeable future and probably
going to get more sophisticated. Accepting that fact is critical,” he said.

While stores are beefing up their apps to help position them as the go-to location on the web for product
information, deals and loyalty rewards, Underhill said retailers need to look around for additional opportunities to
jump into consumers’ online lives.

“People are going into the dressing room and taking selfies or using FaceTime to generate consensus from other
people,” he said. “So maybe put your logo up on the walls as a bit of guerilla marketing.”

And since your shopper lives online, your sales help should too, he said. While a lot of stores are trying mobile
checkout via handheld devises, that’s just the start.

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For instance, Saks Fifth Avenue is encouraging its sales help to get social, providing them with their own digital
storefronts through which they can interact with their clients online.

Like everything, Underhill said, retail is in a state of constant flux so store executives can’t get complacent about
any aspect of the business. “If we think about what made a good store in 2000,” he said, “and what makes a
good store in 2017, it is about change.”

Register for the Science of Shopping with Paco Underhill at LIM College on February 22 at here.

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