Ancient dogma vs the beauty of experimentation & observation
It’s a great quote and one I borrow unashamedly from Richard Dawkins. While he was using it to express why science explains and celebrates the joy of nature and our place in it, it could just as easily be applied to the contemporary malaise in retail – not just domestically but globally. For in retail we have reached a cross roads where old thinking is seeing the demise of once successful businesses and celebrated business models.
The ‘dogma of ancient words’ applies to a set of beliefs that many retailers cannot shake around operating models, merchandise structure, sourcing, selling environments, pricing, distribution, people management and marketing. Rules that – if they ever really applied in the marketplace – were born from the textbooks and lecture halls of academia in an era based in a world with limitless growth horizons created by the need to rebuild from scratch after World War Two. With a supply driven economic model, fuelled by an exploding population, a theoretical model was developed that turned into a rulebook not truly scientifically tested in all economic cycles and market conditions. Theory became law and practices were turned into beliefs. Beliefs that today are holding retail back.
The most successful retailers in the new era are those that truly understand scientific theory is based around experimentation and observation. Never resorting to belief but endlessly challenging to look for truths and proof. Those retailers understand what retail prior to World War Two knew. That retail is perfectly designed to be a scientific endeavour with an in built capability for experimentation and observation – every day.
Great retailers today challenge myths and beliefs. They are intelligent enough to know that in a world as transparent and connected as ours, the only way to improve profit outcomes is to find new and better ways to do things and that it starts and ends with creating a relationship with consumers that adds value from their perspective. Value that is perceived by them as better and different from competitors. Value they cannot describe before they are confronted with it but which they acknowledge through their wallets.
Every retail domino that is falling into failure at the moment has a poor value proposition at its heart surrounded by a set of out-dated business principles that has held off the ignominy of defeat only as long as the energy to maintain their desperate acts of survival have lasted. Old retail is dying. New retail is emerging and a renaissance is coming. Not from online and the virtual world because they are only enablers.
The renaissance is being born from unique retail businesses that use experimentation and observation to create and maintain a value proposition that the consumer gets exited to pay for. An exciting source of endlessly wonderful products and services that they take to their hearts and pay full price for. Products and services that competitor’s cynical attempts at plagiarism and copyright theft simply cannot combat.
Retail science is very simple and straightforward. Experimentation and observation. Today, you either embrace it and flourish or face extinction. Even the most die-hard old world believers can observe that outcome.
Peter James Ryan is head of Red Communication and can be contacted on (02) 9481 7215 or at [email protected].
Access exclusive analysis, locked news and reports with Inside Retail Weekly. Subscribe today and get our premium print publication delivered to your door every week.
Inside Retail Polls
Inside Retail Directory
Competition in the Australian luxury market is heating up as new channels and consumers come to the fore. https://t.co/W6O4FqUQGc32 mins ago