Here’s a scene that’s all too familiar to small business retailers. A shopper comes to your store, checks out your products. Perhaps they try something on, or ask you questions about a product. Then they turn to their phone and order that product from an online seller because they can save a buck or two. It’s called “showrooming” (turning your store into an online retailer’s showroom), and let’s be honest: it sucks. But there’s something you can do about it.
Take a page from independent bookstores. Independent Bookstore Day is Saturday, April 30, so now’s a great time to learn some of the secrets that indie bookstores have figured out about how to survive against the most cut-throat online competitor there is, Amazon.
Consider this: Amazon sells many of the same products, often at a loss (the stock market is very forgiving of Amazon not making profits), frequently includes free shipping, and in many states, doesn’t collect sales tax. Talk about an uneven playing field.
“I’ve been at this now for over 25 years, and if I had a buck for every time that the indie bookstores were counted out, I’d be a pretty rich guy,” said Oren Teicher, CEO of the American Booksellers Association. “Indie bookstore resurgence in the US is continuing. We saw an increase of 10.4% in book unit sales in 2015 over 2014 across the network of our members.”
In fact, 60 new bookstores opened in 2015, and it’s not just independent bookstores who are growing, but small retailers of all kinds. According to the Independent Business Survey, in 2015, 67% of independent retailers saw sales grow.
What’s the secret of indies’ success? How can you replicate this success in your small business?
1. Focus on local. “The localism movement in America continues to grow,” said Teicher. Consumers care about what their downtowns and their main streets look like.” Educate customers about the ties between shopping local and the ongoing vitality of their communities.
2. Fill a need. What are your competitors overlooking? What can you do differently? For example, book customers want to touch and feel children’s books and cookbooks and adult coloring books. So independent bookstores have devoted more space to those categories.
3. Create a third place. No matter how technology improves, humans still want to interact with each other. “In a world in which so many people spend so much time in front of a computer screen, this yearning for a third place…to hang out in a place with people… is something that is very attractive to tens of millions of people,” said Teicher. Rethink about your place of business as a destination, where people can meet one another, spend time, discover something they didn’t expect.
4. Sell your knowledge. “We sell books clearly, but we’re really selling the knowledge about books. That has parallels in the other channels of independent retailers. Independent grocers are selling their knowledge about what’s the best produce, the best cheese selection,” said Teicher. You have a huge competitive advantage of the human touch and enthusiasm that online algorithm suggestions simply can’t match.
5. Keep pace with technology. “Today we have access to the exact same technology that our big corporate competitors do, like back office tools, point of sale systems, inventory control systems, payroll management systems, to allow us to run more efficient businesses,” said Teicher. Bookstores also communicate with customers via their websites, email, social media. “Part of the secret of our success is that our members are not resisting this technology but embracing it and making it work for them.”
6. Find partners. Whether other retailers, suppliers, or community organizations, don’t go it all alone. “The manufacturers producing the books we’re selling have figured out they need bricks-and-mortar stores as much as we need them. Most book purchases are serendipitous. Consumers discover books in physical places,” said Teicher. Work with your suppliers to see if they have unique products to sell just to independent retailers, just as authors have done to celebrate and support Independent Bookstore Day Saturday, April 30.
7. Bring in fresh ideas. Many bookstores have been bought by new owners in the last few years. Find ways to have a positive attitude, more energy, and be optimistic. There’s real hope for independent small businesses.
Copyright, Rhonda Abrams, 2016
This article originally ran in USA Today on April 29, 2016