When The Going Gets Tough!

Retailers know the saying “The times they are a changing” all too well. Nothing stands still in retail. And as the cycle turns and the going gets tough, the tough really do get going.

If you are the dominant leader in your category now is the time to push the accelerator – hard. Wal-Mart became the biggest company in the world not through the good times but because it rammed home its competitive advantages in tough times. Competitors panicked and tried to play Wal-Mart at their own game only to run out of steam and collapse in a heap.

If you aren’t the dominant leader but have a competitive advantage, slowing market growth is also the time for you to ram home that advantage. However, your path may be less aggressive than a 40 tonne gorilla like Wal-Mart can afford to employ.

In constrained market growth periods, customer perception strong enough to affect behaviour is king, as you fight for a larger piece of a pie that isn’t growing. Doing the same thing as you’ve always done is not going to get you a bigger piece of the pie. Wal-Mart will tell you that.

At every point in a retailers C.O.M.P.A.S.$.® there is potential competitive advantage. Cultural behaviours. Organisational model. Merchandise. Promotion. Access. Selling environments. $Dollar dynamics. Every retailer has one or more core competencies in these areas of their business that could be the source of their competitive advantage if you know how to leverage it in a way that changes customer behaviour.

In a world dominated by habitual behaviour and narrowing shopping patterns, compounded by slowing growth, changing shopper behaviour is the hardest thing to do. And yet to survive – let alone prosper – this is exactly what you have to do.

It won’t happen by being timid. It won’t happen by relying on the customer to find it.

Every good retailer is soul searching for growth right now. Truth be told – regardless of the cycle – the best retailers continually do it anyway. If you’ve got more than 30% market share in a category you already know where your competitive advantage lies and now is the time to do what Wal-Mart does in times like this – go hard.

If you’ve got a lower share, find your natural competitive advantage fast. Make it relevant to this part of the cycle, broaden its customer appeal and do whatever you can to get customer recognition for it. Then organise your business around that competitive advantage ensuring that your expectations and business fundamentals support it.

Find your place and find your voice. Be loud, be proud and be successful. Despite the cycle.

When the going gets tough…..