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Why Canadian Retail Independents will Continue to Survive in a Changing Retail LandscapeFriday, March 24, 2017 > 11:04:58
Earlier this month, Montreal-based POS company Lightspeed hosted a roundtable discussion with five dynamic, independent Canadian retailers. All shared their experiences, challenges and key learnings from the changing retail environment, and the overall takeaway was that while challenges are abundant, the future of independents is optimistic in Canada.
Discussions focused on the need to create and leverage an integrated omnichannel presence. Other topics included expanding bricks and mortar, engaging staff, balancing online messaging for both SEO and quality storytelling and the importance of customer acquisition.
The five roundtable-participating independent retailers included:
*Montreal-based skincare boutique ETIKET,
*Toronto-based pen retailer Wonder Pens,
*Toronto-based wedding gown retailer Loversland,
*Montreal-based eCommerce retailer Picoum.com, and
*Toronto-based lifestyle brand Tokyo Smoke
Five key points emerged as 'must-do' strategies to grow an independent business in a changing retail landscape. These include the following:
Build brands through storytelling
1. Embrace change,
2. Establish company culture/customer service
3. Focus on customer acquisition, and
4. Embrace a culture of camaraderie among small business
5. The following is an in-depth description of each of these, including quotes from participants.
1. Building your brand
The roundtable noted that in the current retail landscape, it is not only about what a retailer sells, but who the retailer is. Customers are drawn to brands through storytelling – that is, being able to experience both the product and lifestyle behind the brand. If one is producing content, it should be seamlessly integrated into all that a brand does, and be syndicated through each of the avenues where a retailer meets its customers. As the brand evolves, aspects of one's independent business may grow and change, but core values and an authentic voice should remain consistent.
Jon Chan, Wonder Pens, on the use of social media to communicate with customers: "Building our brand began with storytelling through social media, showing a product’s lifespan over time and weaving our personal narrative into our social platforms, allowing customers to know us on a first-name basis and create a lasting relationship."
Alan Gertner, Tokyo Smoke, on building a brand with influencers: “You have to find authentic people who believe in your brand and who you believe in. We work with influencers who would otherwise be our customers. Our brand is community-based, telling stories people will engage with that are not always cannabis related."
2. Embracing change
The roundtable discussed how independent retailers know that the retail landscape in major cities is changing, and successful retailers embrace these changes. Almost all of the businesses at the roundtable, with the exclusion of Picoum.com, (which is eCommerce only) had adapted an omnichannel system. The omnichannel approach allows independents to sell everywhere, at any time.
The roundtable also noted that customers expect the same level of service and efficiency in-store as they do online, and they also expect the system to be totally integrated. A fully integrated system means that you know when your customer has made one purchase online, and you can follow them through to their next purchase in-store. Linking products directly through social media channels makes it easy on the consumer to find and purchase what they need – without losing them in the process.
Erik Schannen, Picoum.com: “Our success story will be how we adapt to the times, things will always change but we need to continue to learn and connect to what’s popular and keep customers up to date. For example, we want to evolve our content to be both authentic and sales driven. We also now know 75% of our traffic comes from mobile devices so this impacts the design and advertising layout we choose to suit the consumer experience."
Simon Tooley, Etiket: “Five years ago we were just bricks-and-mortar and 3 months later we launched online. Now we know 18% of customers are from eCommerce and the relationships need to be just as strong online as in-store.”
3. The importance of company culture and customer service
A takeaway from the roundtable is that independent retailers have a huge advantage by being able to adapt their business quickly. As a business grows, retailers want to be able to provide the same experience in a second or third location as in the original location. Strong customer service and personalization are two key contributors to the success of an independent retailer.
Putting plans and processes in place will also help managers at secondary locations to run the business with the same level of customer service and quality as the original location. It’s important for business owners to spend their time working “on the business”, and finding ways to remove themselves from working “in the business”, according to discussions at the roundtable.
Yvonne Reidy, LoversLand: “We only see one bride at a time to offer a special experience, for us it’s not a numbers game. We know that at the end of the day people want to be cared for."
Erik Schannen, Picoum.com: “Having a system and processes in place is key when expanding your business. Start with understanding your value system, then maintaining that system in each location. For Picoum, this affects expanding our staff, deciding if I hire someone very experienced, or hire someone junior and train them with the values and processes."
Jon Chan, Wonder Pens: “To expand, we would need to trust employees and managers to bring forth the authenticity of the brand. There’s a lot of power in the niche market and having a ‘destination shop’ means intimacy, after you open multiple locations, you can only streamline that through eCommerce."
Alan Gertner, Tokyo Smoke: “At Tokyo Smoke, all managers have equity and that’s been part of our business model from the start. Everyone feels like an owner with a stake in the business.”
4. Retail business is a sales acquisition business
Data is an important way for independents to measure their success, acquiring information about their consumers that will help them to grow their business. The roundtable participants discussed why Warby Parker – an online only success story - opened bricks-and-mortar stores. The touch and feel experience fit their model of customer acquisition: teach your customers about the brand movement at store level, and then expand and continue the brand story through eCommerce.
Everyone in the discussion agreed that word of mouth is still one of the most important acquisition tools for independent retailers, especially if they are off the beaten path.
Alan Gertner, Tokyo Smoke: “I can’t build a store everywhere, but I can build a beautiful experience centre and expand that through online. Most brands start as a subculture that moves into mainstream culture”.
Danielle Gulic, LoversLand: “People like to shop independent and local more than a mall atmosphere. Our visitors come from all over the province and we even do appointments via Skype, but to really sell our concept, we need walk by traffic as a branding tool."
5. A culture of comradery and mentorship among independent businesses
Unlike the 'old days' of retail, independent retailers are willing and eager to work together to accomplish common goals and celebrate in one another’s successes. There is a community of mentorship among independent businesses, which was noted in the roundtable discussion. The changing retail landscape helps to foster these relationships more, as independent retailers look for guidance to find success in their niche markets and neighbourhoods.
The roundtable also discussed the importance of mentors, and how having a ‘sounding board’ can help independent retailers strive to make decisions to benefit their businesses.
Simon Tooley, Etiket: “Independents are taking down the barriers and acting as friendly sounding boards, we don’t know what we don’t know and it’s important to accept that you don’t have to know everything.”
Alan Gertner, Tokyo Smoke: “For mentorship we have a 10 person board of advisors all from different backgrounds and we have different relationships with each of them who are incentivized with a 0.01% claim in the business.
Lightspeed, which is celebrating its 12th birthday this month, will be holding these roundtables regularly as it continues to partner with independent retailers. Lightspeed continues to expand its operations into Canada, as well as internationally. The company says that it believes that "small and medium-sized businesses revive our streets by offering something unique that you can't find in your average chain store.”