A 5 Point Road Map To Compete With Amazon

By Bob Phibbs

iStock-943746338-roadmapLevi's made headlines last week when their stock gained 32% on its first day of trading. While Levi's sales and profits are growing, they didn't come by accident.

For years the Levi's brand foundered as competitors chipped away at one of America's most iconic brands. Beginning about 7 years ago, Levi's crafted a plan of attack and are now reaping the benefits.

But this is not a post about Levi's... 

A lot of specialty retailers have loyal customers because they built their brand in their own way and did many things right at the beginning.

But when the inevitable winds of change blow with increased competition like Amazon, the retailer can be rocked to the core…or even collapse like Payless, Charlotte Russe, and others.

As your business matures, you notice holes in your foundation; things you should have had in place from the start to prepare for long-term growth are missing.

Those gaps in your foundation are what makes you vulnerable to online retailers like Amazon.

How you handle those holes tends to separate into two camps…

You either settle for where you are and fall backwards, or you push yourself to keep moving forward even as the path forward looks less and less certain.

Because the shocking truth is: many retailers are bad at being retailers and are their own worst competition. That opens the door to Amazon and the rest to clean their clock...

Here is a 5 point road map to compete with Amazon:

1. Set your goal to provide excellent customer service. An exceptional shopper experience is as much the setting as it is the encounter with your salespeople. When every inch of your store is thought out to how it could surprise and delight, and you add a professional retail sales team carefully schooled in modern retail sales techniques, who is constantly consumed with making everyone else’s day before they try to make their own day, offering an exceptional experience is a standard, not a rarity.

Excellent customer service evolves from a curiosity about the individual human being in your store and why they chose to drive past other competitors to shop with you. Offering options when it comes to products, asking permission of the customer if you have to leave them alone, and providing wisdom when comparing and contrasting similar products are all hallmarks of an exceptional customer experience.

If you're serious about this, you'll use an outside mystery shopping company to verify if your experience is exceptional or run-of-the-mill. Without this destination of an exceptional experience, you're lost.

2. Buy intelligently, price responsibly, and manage inventory closely. Newer retailers tend to go hog wild when buying what they think will sell. After all, it’s fun to buy things without thinking about having to pay for it. The smart retailer is very familiar with their turns of merchandise and their margins.

Pricing responsibly is knowing how much you have to markup an item to not only clear your costs but also grow your profitability and account for markdowns. You want to treat your open-to-buy like it is your own money; you don't want to see it languishing on the sales floor collecting dust.

For example, it may seem like a good idea to have every type of bicycle to meet every need is smart, but fitting it all into a small space usually means rows of bikes that overwhelm customers and actually lose you sales. Same for cosmetics, shoes, and a host of products where too much inventory makes shopping a chore. Curate your selection for the customer who will buy, not your own ego to have everything.

3. Market focused on what the customer needs and not on your need for their money. So you’ve got a sale? So what! Who doesn’t? Unless you focus your marketing messages on what the customer gets out of shopping with you, you’re like a needy school kid saying look at me all the time. How do you help your customers live a better life? What challenges do your products solve for them? How does a product give the user more time, more beauty, or less stress?

Focus on answering those questions in your emails, your ads, and your status updates, and you’ll find a tribe of supporters loyally supporting your business. Not sure if you are doing it already? Just ask yourself, if I was a customer, would I care about this? If your answer is no, change your marketing message.

4. Train staff with systematic management. Never forget that your job as a retailer is to provide your employees with the hope to do better, to not give in or give up, and to not retreat into feeling isolated or sorry for themselves.  Having the right processes and religiously training your employees make the difference between a retailer who is putting out fires all day long and a low-drama yet high-profit shop.

As I've said numerous times, what most people call training is really exposure. Training only happens when someone changes their behaviors permanently. That's why you want to train with a checklist so everyone receives the exact same information. 

5. Strategically merchandise your front windows and your store. Visual merchandising cuts down your hundreds of SKUS to a manageable few while making shopping fun. When it comes to windows, here's a tip how to make sure the focal point is at a normal person's height. Go out to your front window and look into your window. Have someone use lipstick or something to mark the outside of the window at the height where your eyes are. That is your sweet spot. Create a tight display in that area. The lights in the window have to aim squarely in the middle where your eyes were focused.

Inside the store, the best and brightest merchandise has to be displayed at the front. Keep clearance items in the back as shopper interest decreases the farther into the store they venture.

I had one client sell a $500 ski jacket the day after we re-merchandised his whole store. The jacket hadn’t sold in months prior. Another found a sales increase of 30% simply by creating the right displays throughout the store.

What happens when you constantly work on this road map?

You have less dead inventory.

The merchandise you buy is based on data, not hunches.

You create an exceptional experience for everyone who comes in, not just for your regulars.

You are less dependent on running sales all the time and more dependent on finding what’s new and different to offer your customers hungry for your vision of the world.

Your windows and displays become your silent salespeople focusing distracted shoppers’ attention in a split second to consider buying your merchandise.

Your employees look forward to coming to work and not calling in sick.

Your intentions are focused firmly on the future and how to make everything run more smoothly and profitably.

See also, What Top Brick and Mortar Retailers Are Doing To Combat Amazon

In Sum


To succeed against Amazon, you have to figuratively get up in the blimp and look down on your whole playing field on a regular basis to see the opportunities you’re missing, your competitors who are offering new and innovative products, your employees who need additional opportunities, ... the works.

At the same time, you need to keep your long-range goal always in mind to grow sales and enjoy the journey as you progress.

Use these five points to compete with Amazon and the rest by controlling what you can control.

Discover Bob's On Demand Retail Sales Training

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Are you a hungry brick-and-mortar store owner who’s ready for a fresh, people-obsessed strategy? This training is for you if you want to grow your business using a powerful customer experience formula proven to make your cash register chirp.

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