Monday, December 6, 2010

The customer wants what the customer wants.

Customer demands for quality never really change.

They expect you to have what they want. They don't want to hear about no downturn. What's that got to do with you not having the latest, hottest item in stock?

Well, of course, in some ways it has everything to do with it, as far as the retailer is concerned. (Less money, means less money to buy inventory, you know?)

But that isn't what the customer expects. He wants what he wants. Even if you have fewer customers, each of those customers -- in their own minds, and with their individual desires -- still wants 100% of what he wanted when you had more customers.

The retailer who can most fill demand, when business is down, will gain the most marketshare.

For example, if it takes 100 customers to carry the top 20 items, and you shrink to 80 customers, then you can probably only realistically afford 16 items. But each of the 80 customers you have left, still want the 20 top items. Does that make sense?

I think of a good store as being all of a piece. Think of it this way -- it's a movie that needs 100 people to see it to break even. If only 80 go to see it, you can't cut 20% of the movie out. People quite understandably want the full experience.

That's why when the bigger stores start to crack a little, they crumble. If you are Borders Books, your whole reason for being is that you have books -- lots and lots and lots of books. If you can't supply them, then what are you good for? You can have all sidelines you want, but ...where's the book I'm looking for?

Barnes and Nobles may be turning to games and toys, (to tide them over until they think that Nook will save them -- ha), but that isn't what people are looking for from them. In addition to games and toys, they are going to need to be very careful to keep their book inventory up. (Which means, that they can't just replace books with games and toys, but have to add games and toys --which has got to be causing some stress to their bottom-line...and isn't that exactly the tactic that Border's tried?)

When you carry specialty product, you can get away with not having EXACTLY what the customer is looking for, because -- well, the obvious stuff is pretty much covered by the mass market. The big boys have to have the whole gamut of material. That is the bargain they made with the customer -- that they will have it all, that they will have it first, that they will have lots of it, and that they will be cheaper.

They'd better not fall down on any of those things, or they become -- Borders, Circuit City, Linens and Things. Hard to recover from that, once the customer perceives that you're failing. While the big boys get the lion's share of business when things are flush, they are also damned quicker when they start to stumble. A specialty store doesn't quite have the same onus.

My job is to pretty much cover Comic books and Graphic Novels completely, no excuses -- that is what people expect me to do. So I have to be sure that I carry the 20% that the 80% of the customers want, but I also need to carry as much as possible of the 80% of product that the 20% of the customers want. I have to carry the whole movie, if you will.

However, with many of my other sidelines, I really only need to do the first part of that: the 20% of the product that 80% of the customers want. I can carry my favorite books, recommendations, cult classics and masterpieces -- but I don't try to carry all 50 of the new best-sellers. Costco does a pretty efficient job of that.

Gives me a bit of leeway that the giant chains don't have. (Bless their greedy little hearts.)
Don't get me wrong, I still have to do a good job. I can't disappoint customers too many times, or they won't come back.

To use another flawed movie analogy. A chainstore is like a 16 plex movie theater -- people quite rightly expect you to carry every new movie coming out. An indy store is like McMenimin's -- showing a single second run movie in convivial surroundings and not charging you six bucks for a small bag of overcooked popcorn.

That's the deal.

The customer wants what the customer wants.

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