Tuesday, March 13, 2012

An Open Letter to Gerry Harvey

Dear Gerry,

I’d like to offer my condolences to you.

Your retail business is slowly sinking into the morass of an established business model that has been bypassed by younger, faster and more agile retailers. They realise to survive in retail today you need to do more than squeeze your suppliers for bigger margins to be in your catalogues and have loud advertisements on prime time TV.

Your inability to realise that the goal posts have moved and that you don’t know everything about retail is the greatest drain on your business.

Having low paid poorly trained staff in a shop full of things with prices screaming the size of the discount just won’t cut it any more with the buying public. You need to change and if you don’t you’re going to die.

You gave your online strategy four months before you started to change your expectations, the problem is your organisation has become so addicted to the ‘catalogue cycle’, where results can be measured within days that anything requiring an attention span longer than that of an average toddler seems to be too hard.

Adjusting your expectations of online contribution downwards by so much, so soon after launching just screams impatient loser, would you shoot one of your horses if it lost its first race?

If I had the resources you have to throw at an online strategy I’d be able to deliver better results, but, you’re too wedded to “yell and sell”.

Can I give you a few little suggestions for your online strategy as well as your ‘bricks and mortar’ stores.

Firstly for the stores you really need to get the staff to provide fantastic service, not good, not great, but fantastic - I mean the sort of service levels where people just want to go back because they were delighted by the way they were treated, not by the size of the discount.

Maybe the thoroughbred business has more of your attention nowadays but don’t forget the stores let you get into that executive circle in the first place.

Seriously Gerry, you're on a slow, painful decline to oblivion unless you realise the model that worked oh so many years ago ‘just don’t cut it no more’. You need new blood to turn it all around. I know your franchisees are going to get pretty pissed off if your online strategy means they’re going to have to reduce margins to compete, but, what you're doing just isn’t working.

Let me leave you with the experience I had at one of your stores not that long ago.

I walked in looking to buy something I needed for home. I knew what the rough price range was and so I went to my local store.

It was quiet, the staff were just standing around talking amongst themselves, judiciously ignoring me while I looked at the item I wanted. No one was willing to talk to me, obviously their discussions were too important to the business to provide service to a potential customer.

But then, the moment I picked up the box and started to walk towards the counter they broke ranks and rushed at me like a bunch of NFL players looking to crush a quarterback. They all wanted to write it up for me and carry the item to the counter. Where was all this concern for me when I was looking?

Now I don’t know what incentives you provide to your staff, but I’m guessing there’s something about the number of items they write up at a terminal before it gets to the regular check out counter. That really annoys me because it makes me, the customer, feel like I’m getting the service at the end only because it helps to line the pocket of someone who not five minutes before wouldn’t give me the time of day.

If I feel this way, I’m sure a whole lot of others do too.

I mean I know you did that Undercover Boss infomercial that was supposed to show how you were trying to improve customer service by doing the disguise thing - all it did was prove what everyone is saying about the abysmal level of service in your stores.

In the end I was so offended by the behaviour of the ‘sales’ staff that I actually left the store without buying the item, went to your opposition and got it for less and without having to deal with rapacious sales staff that barely hide their disgust for me as a customer.

I’m sorry Gerry but unless you listen, and I mean really listen you're going to end up as another piece of retail jetsam.

Mr. 1% Spend