We spoke to Bob Phibbs, CEO of The Retail Doctor, a trainer, consultant, and motivational speaker in the brick-and-mortar retail space (and, goodness knows, these days, a lot of those in-store folks NEED motivation). Bob sees the potential for technology to revolutionize stores around operations. However, he sees the greatest potential around retail training for salespeople in brick-and-mortar settings, so they can grow sales and build relationships using tactics that are now so old school, they almost seem new: Namely, engaging customers with useful information and recommendations to drive in-store purchases, cross-sells, and up-sells.
David Zweifler, Gordon Magazine: [00:02:01] I saw that recently you were giving a keynote to an industry association. I think it was a lighting industry association and that’s almost like B2B because these are folks who are in the trade selling to people in the trade. Even the biggest champions of face-to-face retail have said there are commodity items (being bought by professionals), and you’re better off selling them online, rather than in a brick-and-mortar setting. If you’re a lighting store that sells to contractors and people who do light installations or any other kind of B2B retail offering, do you try to keep that audience captivated? And and how do you keep such a businesslike audience — how do you captivate them in a retail setting?
Retail Training Is Cool Again
Bob Phibbs, CEO of the Retail Doctor: [00:03:04] You know, the reality is people go online to buy and they go into a store to shop. That’s the two basic differences. My HP printer takes a model 64. I’m probably going to go online to say “I need an HP model 64.” I’m not going to get my car, try to go through traffic, find a parking place go down to Staples, hope somebody can unlock the case… I’m probably not going to go into a store for that that. Something like that, I’m gonna buy online.
[00:03:37] But if I am just setting up my home office, I’m probably going to go in and see all the things that I need and that might be a new printer that might be the printing cartridge but might be a new chair might be the thing that goes underneath that rolls around your floor.
“The reality is people go online to buy and they go into a store to shop.”
[00:03:51] There’s a million things that a brick-and-mortar does. The thing that’s changed is two years ago Target and Walmart said they were investing in their stores and in their people. And Wall Street said that’s ridiculous. What a waste of money and they shorted their stocks.
[00:04:07] Now who’s laughing when both Target and Walmart have come forward in their in their abilities and they put a high mark on training and making sure that the shopping experience in the stores was better and I think that’s that’s still the way forward.
David Zweifler, Gordon Magazine: [00:04:27] So it sounds to me like, you know, unless the person’s just come out of a coma (and don’t know about the existence of the internet as a buying channel) , if they’re in the store , they’re in the store to be hands-on with the product. So it’s kind of a self-selecting audience. Just by virtue of the fact they’re there. It means that they kind of want to be engaged.
In-Store To Shop, Online To Buy
Bob Phibbs, CEO of the Retail Doctor: [00:04:48] Well, exactly. Nobody’s going into a prom dress store and (saying) “Gee I wonder what they carry here.”
[00:04:55] You’re walking in your pretty much sold. Most brick and mortars don’t realize that it’s yours to lose when someone makes the effort. What’s happened is the store traffic has gone down because the browsers are online. But that means that the people who are most committed are still walking in your doors and I think people are still treating them as if it was the 50s and you know, people are just looking around. Nobody in this day and age who has a job is “just looking around.”
David Zweifler, Gordon Magazine: [00:05:23] Right. So you do you think that the two examples you cited, Wal-Mart and Target, their recent strong performance is going to realign what Wall Street and the rest of the industry feels about retail or is that was that just a blip? What’s your take on that?
Bob Phibbs, CEO of the Retail Doctor: [00:05:46] Well, it’s not just a blip. I mean at the end of the day, there’s gonna be winners and losers in retail and, if you don’t have anything compelling to talk about what you’re doing the customer experience, you end up like Sears or JCPenney or Macy’s or some of the others. And quite simply, when 80% of your competitors carry the same products or services as you do that means that the only place you’re going to be able to compete as it with your people.
“Two years ago Target and Walmart said they were investing in their stores and in their people and Wall Street said that’s ridiculous. What a waste of money and they shorted their stock. Now who’s laughing..?”
David Zweifler, Gordon Magazine: [00:06:16] Okay, so I’ll ask you a question that I already know the answer to but I have to ask it: Obviously they’ll be winners and losers and those with poor retail experiences are going to lose. Is retail still vital? Does it have a future? And do the winners today of the brick-and-mtortar retail battle, are they going to be competitive, you know a decade from now or they are they going to be potentially still around a decade from now and still focused on a brick-and-mortar network?
Not Everyone Wants To Buy Online
Bob Phibbs, CEO of the Retail Doctor: [00:06:51] Well, I’m not Sybil the soothsayer to say what’s going to happen in 10 years, but I think if anything we’ve seen that the hype that the brick-and-mortar store is gone. I would say (this idea) has been postulated by cell phone companies and people trying to get us to shop online, frankly.
But you know, the reality is people still want to touch and feel. High Gens and Millennials are the most likely audiences to go into brick and mortar stores and, quite simply, they appreciate the stories behind the merchandise the customer experience.
This idea that nobody wants to be in a store and they all want to shop on their phones is is often times being thrown at us in a way that (suggest it’s a foregone conclusion) but every survey I’m seeing doesn’t point to that as being a fact but, rather, a marketing slogan. You know like Amazon’s going to be delivering with drones next week something like that like that.
David Zweifler, Gordon Magazine: [00:07:47] You’re the second guest in the short history of this publication that talked about the need for stories. Especially among Gen Y and Gen Z. Can you tell me a little bit more about what you mean?
Stories Are Great If Everything Else Works
Bob Phibbs, CEO of the Retail Doctor: [00:08:04] Well, I’m not one of these people that thinks every item is going to have a story and it’s all about selling stories. At the end of the day, what sells is you connecting with another human being and you being able to establish rapport, discover the shopper, and make a customer.
[00:08:20] Selling a story is part of that. If you happen to know some interesting detail about the item that resonates with the customer, I think there’s there’s great opportunity for that but I think this idea that everything is going to be a story behind it is kind of preposterous.
[00:08:36] I go in the Disney Store and you take your daughter in there and she’s able to put on a crown and a scepter and Ariel speaks to her, that’s what matters more than “Oh, you want to know how the story behind that?” Not really. “You want to know how ethically we made that little crown?” Not really. It’s about the experience and the way she felt.
“There’s a lot of brick and mortar retailers don’t believe in training… I just don’t think that works in 2019.”
[00:08:58] And that’s the big thing people miss is that brick-and-mortar retailers can do something that online retailers can’t, but that comes down to retail training, and it comes down to employee selection, and it comes down to having a brand experience, and if you want to succeed, you’ll succeed with that.
If you if you don’t care then I think what you end up with is hoping that something is going to change and quite simply what’s happening is that your competitors are probably getting much more detailed in what they’re doing behind the scenes.
Retail Training Comes Before Technology
[00:09:33] To use an omni-channel experience. That’s no problem. Using tablets in the store. That’s fine. But they’re no excuse to say I’m going to make my physical space like my web space. Customers don’t seem to respond to that. Same thing with know the whole virtual I’m going to strap an Oculus on somebody’s head and they’re going to virtually be able to do something.
[00:09:50] I mean, if they can’t say hello to people how they are looking to be able to talk to them in a way that’s compelling. So there’s a lot on the table there certainly is and I think we find that the more we can get employees to, at least be trained on how to be hospitable, I think there’s a lot of success that we’re seeing in brick-and-mortar retailers.
[00:10:12] But, let’s be honest: there’s a lot of brick and mortar retailers don’t believe in training. They have this old model of you know, whoever works is disposable and we’re not going to train them and they going to be gone in a few months and that’s what ends up happening and that’s their model for retail. I just don’t think that works in 2019.
David Zweifler, Gordon Magazine: [00:10:32] Yeah, yeah, it’s we’ve all experienced the frustration where sales people are missing opportunities for them, and creating a more difficult shopping experience for you, in-store. And I think that like because so many retailers have kind of abdicated their responsibility to guide people through the buying process, they’ve encouraged them to move online because you figure, “Hey, you know, I might as well be just doing the research myself because I’m not getting any value (in the retail setting) “.
[00:11:00] It sounds to me like you see the improvement in the brick-and-mortar retail system and the potential as being human-driven. If that’s right, do you see any technologies that are really making a difference or a lot of them most mostly on the back-end or fads like AR?
Where Tech Adds And Subtracts Value
Bob Phibbs, CEO of the Retail Doctor: [00:11:24] You know, the certainly payment options are certainly, you know being able to do things.
[00:11:28] I certainly think that ability to have blockchain in your organization, being able to see where something came all the way through the through the pipeline I think is certainly valuable because people are looking for ethically sourced materials. There’s just a lot behind the scenes, but I think idea that, everyone’s going to beacons in their stores, and you’re going to connect the shoppers browsing with their by picking their phone and and connecting it, so when they walk in it says, “Hey David, you’re looking for men’s underwear. Let me show you,” and the beacons are going to show up. I think that’s just silly. I don’t think that’s going to help much myself.
“The more you try to make an employee into a serf for a second-class citizen go wait on me — you know, it’s not Downton Abbey for God’s sake — then you’re not really leveraging the power of having a good person.”
Human Jobs for Humans
David Zweifler, Gordon Magazine: [00:12:07] I’ve always said, human job should be done by humans and technology jobs should be done by technology and I just had a guest who was saying , ” The smartmirrors should be making the clothing recommendations and the person who works there should be going to do the stock checks,” and I was just like, wow, it’s seems completely backwards.
Bob Phibbs, CEO of the Retail Doctor: [00:12:26] Well, and you know, I think it’s more that the robots, I think that’s why Walmart’s always scanning robots to make sure that they’re not out of stock and then clean up spills on the floor, etc. I think those are smart uses of technology because of the kind of mind-numbing jobs that nobody wants to do.
[00:12:45] So if you can come up with something better for the regular employees to do, I’m all over that. But yeah, the more you try to make an employee into a serf or a second-class citizen, “go wait on me” — you know, it’s not Downton Abbey for God’s sake — then you’re not really leveraging the power of having a good person.
Making Retail (Back Into) A Career
[00:13:04] And, make no mistake, there’s a lot of people that make good livings working in brick-and-mortar retail. I mean, they’re not all making minimum wage. There are people that make careers it make a fine job at it. I mean, I think we have changed the narrative as well that you know, the. Walmart of 1980 is not the Walmart of 2019.
Getting able to go to college for free. Starbucks, the same thing a lot of retailers are doing a lot more than the rest of the private sector are to actually make the world a better place and to give these people additional skills.
“Luxury retailers that still have their employees with their hands clasped behind their butts waiting on people silently like creepy people.”
The People Doing It Right
David Zweifler, Gordon Magazine: [00:13:34] If you’ve been to Brooklyn, you’ve probably seen boutiques that are killing it at least in terms of the customer experience with curated products and an immersive in-store experience.
[00:13:47] Are there any retail chains that are doing it well?
Bob Phibbs, CEO of the Retail Doctor: [00:13:52] Well Lululemon’s doing an amazing job can’t argue with that. I mean they do a great job Under Armor does some nice things Nike certainly does some nice things even Warby Parker’s doing nice things in their brick-and-mortar stores that Container Store if I haven’t already said them…
I think there’s a lot of them that are out there doing really well, who understand who their customer is and isn’t and they’re able to deliver on it in new and different ways. For example, you go into a Nike store in the Meatpacking District. It’s going to be different than when you go into the one in Midtown Manhattan.
[00:14:25] I mean everyone’s different. You look at a Ted Baker who every store is created by and for the local area. So it’s got that sense of place and it’s got that feel and they have well-trained employees. Their sales are down a little bit the last quarter, but clearly that’s the way forward is being really able to say, “this is who we are,” “this is who we aren’t” and getting people to be comfortable working in retail to do that. And I think that’s that’s still the way forward.
Doing Luxury Wrong
[00:14:58] You know, luxury retailers that still have their employees with their hands clasped behind their butts waiting on people silently like creepy people. I don’t think that’s the way forward and I think a lot of legacy department stores have serious problems in how they look at interacting with people.
I think it’s not human and it’s not personal and it’s got to be mind-deadening for the people that are doing it, but they don’t seem to want to change. So till they call me for retail training. I just say if that’s fine. (Laughter.)
“People say so it’s not the role of a retail store to sell merchandise. Then what the hell is it? …people walk in there to exchange their hard-earned money… to either live a better life give a better gift or treat themselves. And if you can’t close that deal, then you’re failing in retail.”
Community Connection A Nice-to-have
David Zweifler, Gordon Magazine: [00:15:28] I’ve had a few guests who have spoken to me about stores’ connection to the community. How important is that do you think and is that really just a small boutique thing…?
Bob Phibbs, CEO of the Retail Doctor: [00:15:41] How do you mean that?
“The experience that’s going to make somebody money and have a raving fan is in the center of the bullseye, which is quite simply: How are you converting ‘lookers’ to ‘shoppers’? And how are you getting the add-ons? If you can’t solve those two, I don’t give a damn what you’re doing.”
David Zweifler, Gordon Magazine: [00:15:42] Basically being involved in the community and creating events that are specifically geared for the communities that they’re in more than just, you know, promotions to get people into the store but identifying things that the local community cares about, and taking some kind of role in that?
Bob Phibbs, CEO of the Retail Doctor: [00:16:03] If you’re looking how to be successful. Look at a bull’s-eye. I think your way out on the fringes in that.
[00:16:09] Yeah, that’s a nice to have. The experience that’s going to make somebody money and have a raving fan is in the center of the bullseye, which is quite simply: How are you converting ‘lookers’ to ‘shoppers’? And how are you getting the add-ons? If you can’t solve those two, I don’t give a damn what you’re doing.
[00:16:24] It doesn’t really matter because just getting bodies into a store. I was talking to a person they were talking about a big event in Manhattan (for a knife company that we can’t name here) to get Millennials. So they had a big event in a Swanky restaurant where they serve food and I think they had craft cocktails and the whole thing.
If You’re Not Selling, You’re Failing
[00:16:41] It was introduced them to this luxury knife brand and so they are tell me how this the event was a success. We had hundreds of people. I go, “And how many bought knives?” Oh, well, no one bought a knife. So, really, what the hell did you do? You threw a party, which doesn’t take anything.
“There’s no denying there’s a shake-out going on in brick-and-mortar retail. That’s certainly happening. There’s just too many places to buy too much of the same stuff.”
[00:16:59] You got Millennials out to get free liquor and food. Well that’s not hard to do. But you missed your core, you know, you had one job which was to expose them but more importantly to close the deal. And I think a lot of people are patting themselves on the back for all these quote-unquote Innovations when they still miss the what the role of retail is.
[00:17:23] People say so it’s not the role of a retail store to sell merchandise. Then what the hell is it? I mean, I’m sorry, you know, it’s not a church. It’s not a school. It’s not a catering hall. You’re there people walk in there to exchange their hard-earned money that they’ve spent hours and hours on for something to either live a better life give a better gift or treat themselves. And if you can’t close that deal, then you’re failing in retail.
David Zweifler, Gordon Magazine: [00:17:51] Do you see a turn of the tide in retail? Does it get better for retail from here or do you think like there’s still a lot for retail to — a big gap to make up with..?
Training And Brand
Bob Phibbs, CEO of the Retail Doctor: [00:18:08] Well, there’s no denying there’s a shake-out going on in brick-and-mortar retail. That’s certainly happening. There’s just too many places to buy too much of the same stuff. Having said that, I just say it doesn’t have to be you.
[00:18:21] You know, when you look at a Container Store that puts a million dollars in a retail training budget every year then you suddenly realize, like, “wow.”
“It doesn’t matter to you think still in the old days of ‘Stack it high and watch it fly.’ None of it flies.
[00:18:28] And it’s not and it’s not just a big boys of doing it, there’s a lot of independents that are doing a fine job as well, but they know their numbers they know their margins. They know their numbers. They know how they’re talking to their customers and they are a branded shopping experience.
[00:18:39] If you have that, then I think you’ll be successful. If you don’t have that, it doesn’t matter to you think still in the old days of “Stack it high and watch it fly.” None of it flies. And, you know, your own vendors are now competing with you online. So it’s a very different world than it was just five years ago.
Know Your Customer
So, you know, I just keep saying if you know who your customer is, and who they aren’t, and you know how to service them with the right retail training, then when you get them into the store, you understand you only have two goals. 1) How do I convert them from looking to buying? 2) How do I add on to the sale?
[00:19:12] If you get that right the rest of it falls into place. But you only a dozen eggs David. So you’re going to use eight of them on events and you only have four left for retail training, and hiring and developing staff then you’re probably not going to be able to be successful.
[00:19:28]You might get some buzz around it, might get some VC money behind you, but you’re certainly not going to be able to tout about how great you are, because your numbers are all that matters.