Making mistakes in retail can be a good thing — as long as they come from pursuing innovations that make your company stand out in the customer’s eyes.
But not every mistake is a good one. Some are truly harmful to the business and can undermine the company’s results. That’s exactly why, in this article, we’ll walk you through the 8 mistakes you need to eliminate from your retail business, along with solutions to avoid them.
So, do you want your retail operation to be mistake-free? Keep reading to find out!
1. Not planning properly in retail
The first mistake retailers need to avoid is poor planning. After all, when this process is flawed, no action will deliver satisfying results. Here are a few precautions you need to take:
- set individual goals for each store: never standardize objectives across locations;
- choose committed partners, associates, and employees who have the skills your business needs;
- have an accountant you can trust;
- keep your knowledge up to date and stay on top of innovations (we’ll talk more about this throughout the article).
It’s also important to understand basic financial concepts so you don’t make planning mistakes (cash flow, profit margin, inventory turnover, etc.).
2. Not keeping an eye on changes in the market and in your audience
The market is changing at an alarming pace. Standing still is a mistake that can drive many companies out of business.
On the other hand, those who keep up with the changes in retail can get a big step ahead of the competition and grow quickly. So, if you want to follow the trends, here are some tips about the market and consumers:
- your customer’s time is extremely precious these days. So solve problems and don’t wait for them to come to you — find ways to go to them;
- the POS needs to be more than a place to sell. It should act as a complete platform, or even a “mini-factory,” offering rental and co-creation options as well as experience points;
- remember the “desktop” computer? Great, but Gen Z (born between 1995 and 2010) barely knows what that is. These young people were born into the mobile era, hyperconnected. So stay on top of these technological innovations.
Finally, don’t fall into the so-called Gabriela Syndrome: “I was born this way, I grew up this way.” Instead, keep up with changes in your audience and the market, and strive to evolve at the same pace!
3. Not innovating
As we saw in the previous section, the market and consumers are constantly changing. That’s why conventional tools and approaches no longer drive engagement.
Keeping in mind that competition for consumers’ time and attention is fierce, the experience you offer can’t be “more of the same.” So our tip is to test retail experience tools such as:
- augmented reality;
- holography;
- sensors;
- interaction between screens and mobile devices.
In short, the options are many. It’s up to your company to innovate — or to rely on an agency that specializes in the subject.
4. Poor inventory control
Buying more products than you need takes up storage space, while buying too little can cost you sales. So the ideal is to know how to balance your orders and professionalize your retail processes.
It’s also important to monitor the average storage time to avoid stagnant merchandise — after all, stock that doesn’t move is money lost.
5. Offering irrelevant services
Offering mini-services — that is, not providing complete, real benefits — also reduces engagement. Likewise, information needs to be relevant for customers to see value in the content your company provides.
So offer your customers a personalized experience. Develop services that solve real problems, and create memorable content.
6. Underestimating customers’ interests
Many companies focus their strategies on targeting (target audience) and, in doing so, seem to put on blinders that keep them from seeing the opportunities around them.
If a 50-year-old customer walks into a sporting goods store that makes this mistake, for example, they might be underestimated when showing interest in buying a skateboard. The customer would then leave dissatisfied, and the store would miss out on a great sales opportunity.
In fact, someone who loves skateboarding can be 5, 10, 18, 32, or 50 years old. And their purchasing power or interest can’t be judged based solely on age, or on a target predefined by your company
The same goes for any other segment: serve every customer in the best way possible. That’s the only way your company can take off the blinders and start seizing every opportunity.
7. Being careless with the company’s organizational culture
Abandoning your business’s DNA is a mistake that can leave employees unsure of how to act or what image to project to customers in retail. So reinforce the company’s mission, vision, values, and strategies, as well as what needs to be done to achieve these goals.
8. Focusing all your efforts on deals and low prices
Occasional promotions are always welcome and help move stagnant inventory or refresh display stock. However, focusing all your actions on low prices drains substantial resources from retailers — besides coming across as a lack of creativity in your customer’s eyes.
Instead, invest in the new models that digital transformation makes possible. That’s the best way to offer consumers a fantastic shopping experience while ensuring a healthy profit margin for companies.
In short, as we’ve seen, the retail mindset needs to change so it doesn’t stay stuck in the mistakes of the past.
Of course, this isn’t an easy task, and it requires marketing managers and retailers to stay tuned in to technological innovations. What’s more, transformation will always bring new mistakes. But may they be mistakes that lead to growth and winning over customers!
So, did you enjoy this article? Did you see the 8 retail mistakes you need to avoid? Any questions? Leave us a comment telling us about other mistakes that hurt businesses!
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