The Amazon Effect

Few would argue that Amazon has had a massive impact on the consumer landscape over the last few years. They started as book retailer and ended up selling... well... everything! As retailers, is this the end of the world as we know it?

The short answer is... No.

That said, 'Retail Is Evolving' and you need to as well if you are going to compete.

In previous articles for The EPOS Bureau, I discussed the three types of retail economy. The 'Price-Led' economy; the 'Convenience-Led' economy; and the 'Experience-Led' economy. All have their role to play in the dynamic world of retailing.

Many predicted that Amazon was going to dominate the retail landscape. At one recent conference where I was presenting, a Dutch speaker disagreed with my message and predicted that 'Bricks and Mortar' retailing will actually disappear and we will purchase everything online. At a basic, human-interaction, level the very thought makes me shudder. I cannot see the day when consumers will not want to go to physical shops and enjoy the experience.

That said, it is inevitable that online shopping will continue to develop but, at the same time, so traditional retailing methods will continue to progress alongside online activity.

It always has been about the consumer and it always will be.

Consumers are the decision makers in today’s market and it is they who will make the choice on where they will shop.

Personalisation

There is a hidden secret to success which many retailers, including convenience and experience retailers, have yet to discover… namely, 'Personalised Solutions'.

We all want to be treated as an individual and we all have problems we need solutions for.

The more we can personalise the solutions we offer the consumer, the more successful we will be as retailers.

Where can your customers get advice that is tailored to their abilities, their time allowance, and their budget?

Hello fresh box with fresh chicken

[Image courtesy of hello fresh]

Meals in a box

Providers of this service are just one example of businesses that have identified and capitalised on this 'personalisation' opportunity.

The growth in this sector around the world has been simply staggering.

Take Hello Fresh, 2.5 million active customers ordered 65 million meals and pushed turnover up from 295.6 million euros to 420.1 million euros in the first quarter of 2019 alone. (Source: Retail Detail)

This service is also helping to reduce household food waste; one of the major challenges of the coming decade.

In Australia, for example, the food waste per household currently stands at circa 345kg or $3,800 a year

The consumer gives the 'Meals in a box' supplier quite specific, individual, information on their eating habits and the result is the box can be more tailored to consumers' needs and wants. This is happening at the same time as consumers are shifting from restaurant eating to fine dining at home.

Adapting for farm retail

Can we adapt and adopt this thinking in the farm retail sector? I think we are ideally situated to be the leaders in personalised solution food retailing.

Eat local food packaging

Imagine if a consumer let you know about their lifestyle, family size, preferred eating habits, what they enjoyed eating and what they did not like eating. They advised on their cooking skills and understanding of diet management.

Based on this information you designed a healthy eating regime based on what was available each season in your farming community. The box could have a QR Code which, when scanned, would provide the consumer with information about the farm experience.

One other, psychological, benefit of meals in a box is that studies have shown that people enjoy 'unboxing' deliveries. (The Psychology of Unboxing by Maria Haggerty)

At our own farm we are getting more and more requests to personalise the food offer and to keep it local. Our results show definitively that our average sale is going up per customer.

To ignore 'personalised solutions' is to ignore the obvious changes in the market and is tantamount to 'sticking your head in the sand' and pretending that this is just a fad. It isn't; you can either evolve and adapt or wait for someone else to grab this share of the market.

Remember that the big online retailers are getting to know more and more about their customers. Some consumers do not have problem with this as it saves them time whilst others look at this 'data-collection' as a threat to their privacy and are now turning their back on the online retailers in favour of local businesses.

We live in challenging times; consumers are forcing change across all aspects of retailing. The food industry is at the forefront and farm retailers should be constantly on the look-out for ways to apply the benefits of theses changes to their own offering.

The message we need to take on board is that retailing is coming full circle. My parents shopped at their local shop; the owners knew what they liked and wanted; the local butcher would save them a special cut of meat they liked; the same occurred at the greengrocers and everyone knew each other’s name.

So, Amazon beware... farm retailers are the ones at the forefront of personalised solution retailing. Yes we need to adopt and embrace technology but the key to success is that we are local businesses that can provide personalised, 'people-service' that Amazon will never be able to achieve.

Consumers visit a farm shop for the 'Magic' or sensory experience combined with the 'Logic' of the rational experience.

Challenge

So what makes your business special?

Identify what the key 7 to 9 touch points on your customers' journey that make a difference in their shopping experience.

Once identified, develop these with your team to ensure you provide a personalised experience that is second to none.

Comments

John Stanley

John Stanley

Contributor

www.johnstanley.com.au

John Stanley is a retail consultant specialising in the farm retail sector. Based in West Australia, he is a sweet chestnut and pig farmer as well as consultant and conference speaker with clients in 35 countries. He is the author of several books in this subject, including the book 'Food Tourism... A Practical Marketing Guide'

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