Don't get me wrong, WarbyParker.com is a terrific e-commerce concept, with a well thought sales process designed to overcome any potential mental obstacle that consumers might find (or create) to buy glasses on line. But, there will be always consumers like me (who knows, perhaps it is because I am not one of those Millennials geeks but a proud Generation X scout) that will prefer to be attended by an optician who will give them a professional advice on the kind of glasses that fits better with their shape of face and who, at the end of the sale, will measure their PD...
I love watches, I own a small collection, definitely less units than what I would love to have and for sure way more than what my wife think I need... I say that it is an investment, it is not... Anyway, my favorite brand is Rolex but I would never buy a Rolex in an Rolex-only-store, why? Because buying a high-end watch, a master piece of manual craftsmanship, is a very special event and I need to feel that I am giving other brands and models the same chances to be bought; I also need the expert advice of a sales clerk who, in the end, will probably confirm that I need to buy the model I thought I will buy even before I set a foot in the store.I also love to drink coffee, not those massive mugs of lattes or similar that you can buy anywhere in the world but just a simple shot of expresso (perhaps with a little bit of milk); when it comes to a cup of coffee for me, less is more and sugar is a must. Have you ever bought coffee at an official NESPRESSO store? If you haven't done it, I would strongly recommend you to swing by one of these outlets and, if yes, I am sure that you will agree that the consumer experience is absolutely premium (store lay out, visual merchandising, customer service...); I have to admit that I receive a better treatment buying a few boxes of Livanto Cupsoles in a Nespresso store that cost me less than $50 than my experience buying my last car of a pretty premium brand whose name I will spare in this blog. As a result, I am consuming now more coffee than before.
On the tittle of this entry I was proposing to talk about Merchandising, and that's what all of this is about. Mastering the basics of Merchandising, companies will be able to maximize the number of premium retail consumer experiences and hence maximize their revenues in the long term:
-The online channel is, without any doubt, the one that offers the maximum potential of growth; some companies (many) will have to figure out how they will play in this area before the train has left the station and it is too late. Some others, like WarbyParker started online but perhaps will have to explore the possibilities that a brick and mortar expansion can offer them to reach, for example, risk-averse consumers like me.
-Obviously, it is easier to control your own retail and many companies are expanding what they call their Direct To Consumer operations, opening their brand only stores in different formats (flagship stores, inline stores, factory, etc...). This represents a tremendous opportunity to connect with their consumer without any bias and if the retail is done properly an extra margin generator thru the vertical operations. But, not every company can or should create their own stores and definitely not all consumers want to buy alway in a mono brand environment, no matter how much loyal they are for a given brand, like Rolex.
-Sometimes the opposite of Premium is not 'cheap' but ordinary. Any brand can present themselves in a premium way even in an entry level retail environment as long as they do it an extraordinary way. Nespresso stores are premium and different to a general grocery outlet where you can buy a bag of coffee beans. The final product, the cup of coffee, is pretty much the same, the buying experience is different and the consumption of coffee at home has increased because there are more way to have access to the same product. Consumer companies need to figure out how they build their product lines to assort different retail propositions; if they do it successfully, they will achieve a healthy long term growth.In the next entries of this blog I will talk about the different aspects of the Merchandising function and how if implemented properly in the modern organizations can be a key enabler to achieve the strategic objectives of any corporation.
