Why The Alcohol Retail World is NOT Changing

No reader can think that retailing is the same as it was 20, 30, 40 or more years ago. For one, the quantity of choices for a consumer has gotten out of hand. Think about the average consumer and the vast landscape of brick-and-mortar stores.

Add to that the availability of innumerable items on the Internet, and customers have more choices than they have ever had.

How can a business compete?

The answer: Do not lose track of what has always worked.

Lets talk about some of these strategies. What we notice most are groups of businesses that decide item and price are the way to attract customers. It starts with the weekly newspaper ads, which are a mass listing of items along with their discounted prices. If the store gets the customers contact information, the store is likely to continue to send multiple emails to the customer, again with multiple items at discount price.

Discounting in smaller amounts, 20% or less, has been shown as a legitimate way of attracting customers and building sales. However, when the discounting gets larger — in the area of 30% — research shows the customer is less likely to return to shop at the business. This is because the customer who is attracted to the larger discounts has demonstrated how they select where they shop: the store with the bigger discounts. And when it is not your store, it will be another store with a larger discount. These customers lack loyalty beyond chasing the cheapest pricing.

Then there is the other group of customers. They want customer service, information, value and a great shopping experience. Not that they dont want a good deal, its just that price is not the driving factor. There must be something to each of these values, as we see even Amazon opening stores, and Wal-Mart creating and experimenting with new formats. They both know the old style remains important.

Customer service, information, value and a great shopping experience: each has something in common: they require a human being. The question for businesses that want to focus on this group of customers, then, is What are you doing about the human being you are providing for the customer to experience?

It comes down to having the right employee and making the right choice when you hire.

You probably have some of the right choice employees already working for you. And you have some employees you wish would become right employees. Here are our best tips for getting every employee into the right choice category.

Your best employees should do the interviewing and hiring. As the owner or manager, we often have a habit of taking someone less than ideal. Your best employees must work with that poor choice more than you do. When the best employee does the hiring, they are less likely to lower their standards.

The second tip resides in education: product knowledge and sales skills. Have a biweekly one-hour staff meeting in which every employee attends, and your best employees are the teachers. As other employees improve their skills, you gain new teachers for staff meetings.

The world is changing — no, it is not. There are always customers who shop by price, and there are others who shop according to the four ingredients. One comes with lesser margins and a constant battle for customers; they become a commodity business. The other hires the right people and becomes a unique selling business.

The business that becomes a commodity last is always the winner.

Tom Shay is a lifelong small-business owner and manager. He has authored 12 books on small business management; a college textbook on small business financial management and co-authored a book on retailer/vendor relations. Tom has written over 400 articles that have appeared in over 70 international trade magazines.

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