Struggling retailers have often lost their way and don’t have a clear purpose. But how do you actually find a purpose? In fact, it can be confusing, hard work and full of conflict. On this episode of the Retail Transformation Show, join me, Oliver Banks, to find out why you must find your purpose. Plus, learn the simple steps to define your purpose. Finally, find out how you can use it to stay relevant for your customers and keep a competitive advantage.
Why customers choose you
Online retail has opened up the entire marketplace. Suddenly customers have a huge amount of choice. There are little no barriers to entry. In fact, you can buy or create products and technically, you could be trading in no time at all.
With all of this choice, loyalty is becoming tougher to achieve. Basically, the increased choice has made it a customer led market. In turn, you must become a relevant retailer so that customers choose to shop with you. Ultimately, it comes down to 3 elements that can make your retail business the place that customers choose:
Price. Perhaps the most obvious element when it comes to defining a competitive advantage in the retail market. However, there can only be one “cheapest” and it can often end as a the proverbial “race to the bottom”.
Convenience. By convenience, I mean the easiest option. With so many options open to customers, what is the easiest and quickest way for your customer to solve their problem?
And finally – Trust. Trust is the hardest to achieve but it is your best bet in the long run. You own your marketplace advantage. It’s less likely that a new competitor can usurp your uniqueness or outmanoeuvre you.
But, trust is difficult to define. That said, there is an “equation” that suggests what’s needed. However, this is more of a metaphorical equation than my engineering past would have perhaps liked!
Why successful retailers need a purpose
Having a clear purpose allows you to be relevant for your customers. Your retail business will create a congruent brand that just makes sense. This will be evident in your marketing and advertising. Also, in your operations and proposition. Even your various policies and procedures will all support your purpose.
In turn, this will help you to build trust with your customers.
Your purpose should form the guiding light for your business.
- What should your strategy be – look to your purpose.
- Do you have the right elements in your strategy – look to your purpose.
- How do you need to transform – you guessed it. Look to your purpose to guide you.
But, it doesn’t stop there. Use your purpose to motivate your workforce. It will give your staff purpose and meaning in their own roles. By allowing them to work as a team, they can collectively drive towards something bigger. This will be a big trend in workforce transformation over the next few years.
Also, you can inspire your customers with your purpose. Get them to play a part. A great example discussed in the show is TOMS. Go to TOMS.com or TOMS.co.uk to find out more. Or, continue below were we explore more about their purpose.
What does a purpose look like?
There should be 5 elements to your purpose:
- Who you are
- What you do
- Who you do it for
- How does “what you do” help your customers
- What does it allow them to do or allow them to be?
When you define the purpose of your retail business, it should be tangible and feasible. Having a purpose of “eliminating pollution,” “stopping world hunger” or “curing cancer” is noble but too big to really do anything about. Where do you start? What’s the first step?
However, it should also not be too obvious or literal. “Make money,” “increase sales” or “sell lots of stuff” doesn’t really inspire. There is too much self orientation as suggested in the trust video above.
4 steps to find the purpose for your retail business
In the podcast, there are 4 steps to find purpose. If you follow these 4 steps, you can find out how you can define a purpose and use it to become a relevant retailer.
1. Look at your history
What are your values? What is in your brand DNA? The consultancy, Bain, have a concept called “Founder’s Mentality” that begins to focus on this. Essentially, by looking at who you were and what made the business successful originally, you may be able to uncover the keys to future success.
2. Ask customers
It sounds obvious but it’s often overlooked. What do they think that you stand for? And what do you stand against? How do they view your brand? Also, what is it that sets you apart from your competition?
3. Go deeper – look at why your customers come to you
Talking customers will undoubtedly reveal a huge amount. However, they may not be able to voiceover everything. You’ll need to look deeper at what shopping with you allows them to do. Who does it allow them to be?
In the episode, I discuss this video with Jeff Bezos of Amazon and why it is a great example of Amazon’s purpose. In fact, this brings together elements of step #1 and step #3.
4. Serving a greater good
Finally, the founder, CEO or other senior leader may feel a personal call to action. Perhaps they feel compelled to serve a greater good. Maybe the business was always set up to serve this purpose (which would be evident in step #1 above).
The example of TOMS earlier is brilliant here. Essentially, they look to serve people in need with their promise and purpose:
“With every product you purchase, TOMS will help a person in need”
In fact, they’ve given over 86 million pairs of new shoes to children in need across the world. This is a great example – their purpose is clear to see and evident in all they do. In turn, it engages their staff and their customers. You can find out more about how TOMS are improving lives.
Finding your purpose is key to your future retail success
Finding purpose is critical in today’s competitive retail marketplace. In fact, I believe that if more retailers had a clear purpose then there would be fewer struggling retailers today.
Do you have thoughts or reflections on today’s episode? Reach out to discuss on email (email@example.com) or on social media. You can find me on LinkedIn (Oliver Banks) or Twitter (@ollie_banks).