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The 1980s Called – They Want Their Retail Strategy Back

by Robert Hetu  |  December 30, 2016  |  Submit a Comment

Its taking too long. Visiting a regional mall this week reinforced the urgency of required change in the physical retail customer experience. Other than a few aesthetic changes, and some new retail brands, it looked like retail strategy circa December 1989. Anchor stores like Macy’s Sears, Bonton and Boscov’s look old and tired, featuring snagged and dirty carpets, scarred fixtures, and a sea of discount signs.  JCPenney is a confusing mix of modern updated departments combined with 30 year old beige and brown dreariness in others.  In fact the current physical experiences are declining, with stores looking like the bargain basements they have become.


The Modern Customer Expereince

The only thing generating excitement are extreme deals.  Express offering 70% off created a busy store.  Aeropostale is liquidating many stores thus drawing crowds of discount hungry shoppers.  In this mall Limited just closed its doors after liquidation. Abercrombie was devoid of customers, as was Sears (in spite of discounts). The mall is fast becoming a discount bargain hunt. News of additional store closings including more than 30 Sears locations is just beginning.

There are many reasons that stores need to close locations but these retailers better start to figure out ways to reinvent the physical experience through innovation.  New shopping experiences enabled by technology are changing customer expectations but traditional multichannel retailers are moving too slowly in transforming physical experiences. The physical experience is the point of possible differentiation for most of these brands.  Simply ceding territory to more nimble online competitors accelerates the transfer of market share.

How can these venerable retail names continue to come up empty when it comes to new physical experiences?  Amazon, or I should say the fear of Amazon, is the root of all evil.  Some retailers want to be it, some live in dread of it, some admire it, but all think about it. You cannot copy your way out of this, each retailer’s strategy will be unique, based on customer expectations.  On this day when we learned about floating warehouses, make a new year resolution to prize innovation above all else. Here are a few of my blog posts that are related to this topic.

Just Closing Retail Stores Is Not Enough


Retail’s Perfect Storm


Macy’s Backstage? Where is the Magic?


The Sky Is Falling; Retail Bedtime Stories


Retail Comp-Store Sales Becoming A Useless Measure


Additional Resources

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Category: technology-and-emerging-trends  

Tags: abercrombie  amazon  bonton  boscov  competition  consumers  customer-analytics  customer-centricity  digital  jc-penney  jcp  limted  macys  multichannel  sears  shld  stores  

Robert Hetu
VP, Analyst Retail
7 years at Gartner
29 years IT Industry

Bob Hetu is a Research Director with the Gartner Retail Industry Services team. His responsibilities involve tracking the technology markets and trends impacting the broad-based retail merchandising and planning areas. Mr. Hetu is an expert in the areas of brand, vendor and assortment management, merchandise planning, allocation, and replenishment. Read Full Bio

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