Neiman Marcus Visit Illustrates Why Brick And Mortar Stores Are Losing Money

By Bob Phibbs

iStock-588987782-neimanI was in Dallas a few weeks ago and decided to visit the Neiman Marcus flagship store.

Upon entering through the cosmetics section I received a freindly greeting from several of the women working there.I found my way upstairs to men’s.  I was with my friend Bill, and a very personable blonde woman welcomed him. He exchanged a pleasantry as I started looking around the department.

I could hear one associate in men’s shoes loudly talking to another one – both behind the counter. Another guy was stationed in the middle of the floor as some kind of sentinel, and there was another associate with his hands clasped behind his back, watching.

One of my pet peeves with luxury brands is that they have this old notion that service means being available and aloof until the shopper asks for something.

People go into a store to experience a feeling, but feeling like you’re in a fishbowl or ignored doesn’t make you want to spend exorbitant amounts of money…just sayin'.

I spotted several long racks - like something from the sixties - hung to the max with what appeared to be new men’s clothes. On every end was a sale sign that said, Up to 40% off.

I didn’t go in to buy something on sale, so I looked past them to a 4-way filled with unremarkable dark clothing. As I picked something up to look at it, the salespeople remained aloof and away. I put it back and moved on.

After going around the store, Bill held up a Robert Graham shirt from the sale rack and said, “This looks like you.” I reluctantly came over and took it from him. I looked around for a fitting room but didn’t see one. The aloof salespeople offered no help, so what the heck, I took off my pullover and tried it on. I looked in the mirror; it fit and it worked. 

Then I looked down to the sale rack and spotted a plum leather jacket.

I had had my colors done years ago and the woman had said to me,”If you ever find this color, buy it, it will look great on you.” I looked for my size; there was one in every size, so I slipped on a large. Again, no comment or help.

I looked in the mirror. It all worked. I glanced at the 20% off price tag, changed my shirt, and looked for the blonde.

She told me she was only an extra and hailed a guy to come over. I was peeling off all the protective tissue paper on each of the zippers as he came over to the register.

After it was all rung up, the young man said from behind the counter, "You know that would really look good with a pair of black pants."

After the transaction had been finished.

What should have happened? Retail sales training would teach the associate that once a shopper shows interest in an item by picking it up or trying it on, you need to get your butt over there to engage.

Perhaps if they had done that instead of talking to each other to maintain their aloof quotient, I would have bought the pants and even more merchandise 

That aloof, sentinel should have brought over a pair of black jeans as I was putting my outfit together.

He should have grabbed another shirt or sweater to give me additional ways to wear the jacket. 

Or grabbed a pair of shoes. Or a belt. Or any of a million things. He could have taken all that trust that I have with the brand, Neiman Marcus, and leveraged it in a really good way.. 

But he didn't do that.

He added nothing to the sale.

Neiman Marcus is three billion dollars in debt right now. People are wondering, "How are they going to survive?"

When you're only clerking the merch that someone wants, you're gonna be in trouble.

And that's my point to you today, that I got a great new outfit. I'm thrilled. I'm glad to be wearing it.

I constantly get compliments on what a great color that is on me. Even at the Theory store where they didn’t even get a chance to sell that color because it was unique to Neiman Marcus I was complimented on the color.

And yet that new jacket ended on a sale rack because gosh forbid an associate realized they had a unique item and made sure it was their job to get that plum jacket out the door.

But another retailer got the rest of my sale.

So why isn't the most premium luxury retailer selling their merchandise? I can hear it now, "Oh, we don't want to be pushy," and yet the brand has a mountain of debt; their very survival depends on how well they convert customers and get higher average tickets.

Just like yours…

Those shoppers willing to leave their home, get in a car, drive through traffic, and try to find a parking spot are looking to give you money.

Customers pay your paycheck!

I’m sharing this story today to show you the need for a branded shopping experience in your store. If it is just fold your hands behind your back when shoppers enter and then wait for them to ask for something, you’re in big trouble.

And a lot of retailers are in trouble for this very reason...

I made a video right after I left Neiman Marcus. It has been viewed 85K times so far on LinkedIn and Facebook. You can see it below or click here:

 

 

What is really interesting to me are the comments on LinkedIn about it.

From Carrie Connolly, “Maybe I’m naive, but, my job is to sell. This includes being authentic and forming a relationship with my clients. At Definitive Audio, we have a couple of beautifully merchandised stores. I like to introduce myself, give them a tour, and play something cool for them. A lot of folks haven’t experienced high end audio before! What this does for ME is keeps my enthusiasm going and when that next person stops in to purchase, they get the same red carpet treatment. I’m not a victim-if retail is no longer working for me, I have the responsibility to go do something else. If and when that day comes, I’ll bring my “A” game to whatever I do!"

When shoppers are not a priority, stores crash and burn.

Louis Contino added, “Sure the associate is right in front of the customer and the gavel falls on them at the moment. But more so this is implicating a leadership problem that rolls from the top. If you don't walk the talk, it never translates down through the organization. Am I being unfair? I don't think so because even with a less than stellar associate, a $1K sale should make anyone jump to attention!”

Jim Farrell added, “Brick and mortar isn’t dying, it’s the art of engaging and maximizing each and every customer that walks through the doors.”

Some said I should have purchased elsewhere or online.

But I never would have purchased these online. I wasn’t looking for a plum leather jacket.

I wasn’t looking for a complementary Robert Graham shirt.

That’s a retailer’s golden edge against online; 90% of shoppers are in discovery phase when they walk in and are open to buying something they never thought of before.

That’s why 90% of all retail sales are still done in a brick and mortar store.

Many retailers decry how hard it is to find good help.

A culture of clerking the merchandise makes the good ones leave; they don't want to become lax and earn less than they know they can.

Oh and if you think I'm picking on Neiman Marcus, I've covered my shopping experiences at many major brand including Nordstrom, the Four Seasons, Dick's Sporting Goods, Wilkes Bashford, the Ritz-Carlton and now Neiman Marcus because, when you look at growing your own business, you must be able to see, understand and proactively know how you want your customer to feel.

See also, Luxury Retail Sales Training: Can't Close The Big Sales Because You Feel Like A Fraud?

In Sum

So many retailers have given up on the trust equity they have with their customers. They seem to feel people now only shop by product need.

That's a big mistake because shoppers still trust a brand to deliver something different than a competitor or online retailer.

Why is it so hard to get brick and mortar retailers to understand the fight isn’t with Amazon for the shopper’s wallet, it is with their own hubris and plain laziness at crafting and executing a branded customer experience?

It’s not about beacons, check-ins, discounts, and VR. It’s about being more human in an increasingly inhuman world.

It’s about making someone else’s day.

It’s about helping shoppers feel less stressed, more confident, and more welcome.

When you do that, merchandise you thought would give you the edge – like a plum leather jacket – doesn’t have to be marked down.

I’ll have more to share on this Tuesday when a major consumer study I did with Oracle NetSuite goes live; watch for it.

In the meantime, if you're looking to grow your sales, click the button below and let's start a conversation.

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