From a recent RetailWire discussion, I comment on L.L.Bean’s consideration of a less liberal return policy than it has always been known for:
Having worked for Kohl’s for 24 years, I have a bias toward more forgiving return policies. Kohl’s always viewed its return policies as a competitive advantage and marketing practice (even though there was plenty of gnashing of teeth among the merchant ranks) and I believe this is still the case. Stores can maintain this kind of trust with their customers, even if they look at tweaking the policy through issuance of gift cards for goods returned without receipts or after some time has passed.
I’d be very careful if I were L.L.Bean to walk away from part of what has defined its brand for a long time. As another panelist suggests, look for other reasons why costs are rising faster than sales, starting with merchandise assortments.
Published April 13, 2016
Corporate culture , Department store retailing , Marketing , Promotional strategies , Retailing , Uncategorized
Tags: Dick Seesel, JCPenney, Kohl's, Macy's, Retailing In Focus, RetailWire
Chief Marketing Officer, that is…after letting go a 32-year veteran of the company. RetailWire panelists took the chance to discuss whether Macy’s needs an insider or outsider to fill the position. (And one panelist added that Macy’s could use a new head merchant, too.) Here’s my point of view:
This may be a good opportunity for Macy’s to look at its stale marketing (and especially its sales promotion) with a fresh set of eyes. Macy’s is in a promotional rut where all of its print sale events look exactly the same (red and black, coupons, a bunch of boxes on every page) and the customer is bombarded by the same kinds of overlapping offers they are used to seeing from Penney or Kohl’s. Surely Macy’s has an opportunity to use its promotional tactics as part of an overall re-branding strategy. (What is “The Magic of Macy’s,” anyway?) Without knowing the inside candidates, I’d look outside first.
Menards, the Wisconsin-based DIY chain, announced that it’s postponing the opening of a new location in Ohio pending the results of the Presidential election. Apparently the family-owned business is hopeful for a different regulatory environment…or something. (The Menard family has donated generously to Republican candidates.) As you might imagine, this topic brought forth all kinds of reactions among RetailWire panelists, depending on their side of the aisle. I’ll let my comments speak for themselves:
It seems to me that the home improvement/DIY sector has done nicely since the Great Recession. I guess Mr. Menard’s memory is short regarding the housing bubble, the unemployment rate above 10%, and so forth.
As I’ve mentioned before, I worked for Kohl’s from 1982 (18 stores) to 2006 (750 stores and much higher now). Kohl’s has opened stores during Republican and Democratic administrations, in times of economic boom and bust, and when the regulatory environment varied greatly. (Remember that the Americans with Disabilities Act was passed by Bush 41, and brought some sweeping design changes to the retail landscape.)
My point: If your company has a valid strategy, go for it. In the meantime, run for office if you want to use your megaphone more effectively.
Kohl’s tested a coffee bar (in partnership with Caribou Coffee) in two of its Milwaukee-area stores. Based on the results, the company decided to kill the concept test. Here’s my recent RetailWire comment on the topic:
I shop the Kohl’s Menomonee Falls store often (disclosure: I worked for the company from 1982-2006), so I saw the coffee concept first-hand. The lack of a seating area was a handicap, and a typical Kohl’s store doesn’t have space to burn at the same time that it is expanding its beauty departments. So the typical Kohl’s shopper making the rounds of the store (with an armful or cartful of merchandise to check out) may not find it easy to balance a cup of coffee while checking her cell phone for the latest coupons.
Kohl’s has other ways to make customers linger and to make the in-store experience more compelling — and it has bigger fish to fry in terms of growth opportunities like Off/Aisle and Fila outlets.
JCPenney is working on ways to get its store managers more focused on the selling floor and interacting with both customers and associates. RetailWire panelists recently commented on this change of direction:
Managers working in retail stores are subjected to the same flood of e-mail (often unnecessary) as employees in any other workplace. The difference is the need to “walk the floor” and do the customer-focused duties that involves, from training associates to checking merchandise presentation and replenishment. “Inspect what you expect” was and continues to be a good philosophy for retail management.
JCP could do itself a big favor, however, by developing more effective systems and store layouts to get customers through the checkout lines. Every Penney store that I shop regularly has an inefficient process (especially compared to Kohl’s) even on days when the stores don’t seem heavily trafficked. This needs to find a top-down solution, rather than depending on the presence of a manager on the sales floor to fix it.
From a recent RetailWire study of stores’ return policies:
More than a tool to drive sales or margins, a store’s return policy should be considered a marketing tool. It may seem counterintuitive that the most lenient policies are most helpful to a retailer’s results, but those policies really represent a key trust-building tool with customers and a way to build consumer loyalty over the long haul.
My experience at Kohl’s — which has always had lenient policies in place — reinforces my perception. Individual buyers may have cringed (the customer returning a watch for credit that he ran over with his truck), but the big picture told a key story about the brand.
One caveat: Stores with liberal return policies are now grappling with the amount of online-only purchases being returned to brick-and-mortar stores. While this is a “cost of doing business” as an omnichannel retailer, it doesn’t mean that the logistical solutions are easy.