Chance

Customer proximity instead of standard

DIY shop format mind change

Local proximity - more click & collect pick-up points - filleting in competence shop formats - local customer orientated formats - omnipresence

EVERYTHING WHERE AND WHEN I WANT! 

Assortment depth and breadth, customer services and fair prices used to be the decisive selection factors for the choice of a retailer. The successful model of the DIY stores was to combine the expertise of many specialist shops under one roof. Self-service, resulting in lower prices and one-stop shopping. The REAL slogan "Once there - everything in it" summed it up.

The Internet has turned the retail world upside down and AMAZON has radically changed shopping with the mission to be the most customer-focused company in the world with the largest assortment in the world. The product search today starts mostly at AMAZON. No business is closer to the customer than the smartphone. It has never been easier to shop - I get almost everything where and when I want. Thus, AMAZON has taken the decisive selection criterion PROXIMITY for itself. But exactly in the topic PROXIMITY is also the big opportunity for the DIY hardware store.

SINGLE - MULTI - OMNI

Stationary retail business transforms from traditional retail to an omni-channel business model. Décathlon is a good example of the successful implementation.

But especially large and heavy construction items, such as bagged goods or stones, can be easily ordered online, but the shipping logistics is complex – delivery to the curb is usually not good enough. In addition, shipping to the customer's home is not cheap. The customer prefers his own drive to the DIY store of his trust. Online ordered and without extra charge pre-assembled goods can be easily picked up with the trailer. Click & Collect therefore represents a significant facilitation in the customer's purchasing process.

However, it is insufficient to define the local proximity to customers only with just to go live with an online shop. And even if the offline and the online business are ideally linked with a good Click & Collect system, that is not close enough to the customer. The Customer is used to having his goods delivered to his door. Click & collect works especially very good when pickup point is close to the customers' home.

TIMID CHANGE

The nearest hardware store is usually the preferred DIY store for a customer. So the expansion with further stores seems sensible. The standard large format, however, does not offer the solution. The DIY companies are testing small formats. Sometimes more, sometimes less successful. The goal: as many contact points as possible for a working Click & Collect business.

Often, however, the fast multiplication of the one new developed format is the focus. But wouldn`t it be better to look at the customer needs in the local environment? In small shops the same assortment, the same competence as in a big shop wants to be shown. This cannot only work limited. Moreover, the result does not exude the same competence as a big DIY store. And the few salespersons in this small shop cannot support costumers equally in every DIY project.

Yet many traders believe in the power of brick-and-mortar retail and the credibility of good personal advice. I fully share this view and I strongly believe most DIY retail companies already have the solution to expand and respond to AMAZON in their own stores.

BENEFIT FROM SHOP STRENGTH

BAUHAUS, HORNBACH, HAGEBAU, GLOBUS, OBI and TOOM stand for the deep construction and garden market expertise. Each of these dealers has expertise and well-developed shop-in-shop systems. So why should a BAUHAUS or a HORNBACH not extract their competence departments, such as the BÄDERWELT or the HAUS des BADES? Or a door studio, a paint shop, a floor studio or a shading boutique into its own specialist center? Of course with a pick-up center for online ordered items next to the shop. And why should BAUHAUS set up its NAUTIC boat accessories department close to all relevant sea, sea and river contacts?

The re-filleting of a large store with specialist departments, the extracting of competence studios seems sensible insofar as it can generate a dense network of many contact points in a city. The dealer is virtually omnipresent and also emphasizes his individual skills. With a large distribution center 20 km out of the city or with the use of the nearest large format as a base camp for the smaller formats. 

CHANCE: CUSTOMER PROXIMITY AND CUSTOMER CENTRICITY

But the most important success factor is to look closely at the neighborhood of the new store. What do local customers need from my assortment or from my services here? Is it a special competence format or maybe just the reduced DIY assortment for the rented apartments? Every shop will probably be different in the best way possible – adapted to the customers’ situation and according to the local customers’ needs. Pure customer centricity which means that it would be wrong just to multiplicate a single small standard format.

SMALLER, FINER, CLOSER, MORE VISIBLE 

Many retailers will initially see the danger of a loss of holistic competence in these smaller specialized formats. The chance contradicts the basic idea of stationary one-stop shopping from the last century and the old law "mass sold mass". The transformation is painful and requires a lot of change, but above all, the new era offers lots opportunities and chances to grow.

PLUS: 

The more stationary competence points, the more permanent area presence, the more the corporate brand is penetrated. The specialist department competencies are underlined and the omnichannel concept can develop much better.

Summery

CUSTOMER PROXIMITY will decide on the choice of the shopping. Locally closer with an assortment that meets to the customer needs at a fair prize.

1.    Customer Centricity:

·     Local proximity with a lot of small shops and Click & Collect pick-up points (products ready to pickup within less than 4 hours).

·     Filleting in competence formats, and ...

·     ... a store format adapted to local requirements instead of multiplying standards. Build shops locally so that they meet the needs of the customer nearby. 

2.    Brand Awareness:

Many pickup points create visibility, omnipresence and brand proximity.

Instead of only one store in a town district a DIY company can enter the hole city 10 more small (competence) shops.

Specialist shops create trust, emphasize competences and give needed substance to the brand.