At a Retailer Training Day in Anaheim, Hot Off The Press President Paulette Jarvey posed this question to independent retailers: Who is YOUR competition, and what is your competitive advantage? Read on to discover what these store owners said—and how the group learned creative ways to identify and utilize their competitive advantage.

Defining the Competition

From chain stores to internet sites, retailers could easily name their competitors.

Who is your competition? Jot down those independent stores in your town as well as the chain craft stores, big box retailers who sell craft or scrapbook supplies, and the photo processing stores. And don’t forget the other activities that compete for your customer’s time: movies, sporting events, computers, gardening and other crafts.

Defining the Independent’s Competitive Advantage

Do you know what your competitive advantage is as an independent retailer? Our retailers shouted out the advantages as they came to mind: “Product and technique knowledge!” said one. “Enthusiasm!” added another. “Hours of operation!” said a third.

Unanimously, retailers voiced their ability to bring new product in faster than chains, reorder more quickly than other stores, and promote the newest and latest merchandise. “I can change my product selection two or three times before my competition even gets a hold of the first product idea,” commented one retailer.

Identifying Your Competition’s Advantages

Your competition has a lot to do with your store’s competitive advantage. After all, your goal is to differentiate yourself from the store down the street. To do this, you must first know what the store down the street is doing!

How? By shopping them! Retail specialists recommend you shop your competition on a regular basis—typically, one day each month, for 4-5 hours. When shopping your competition, whether you’re visiting a craft chain store or another independent, look for product selection, price and customer service.

Take a notebook and jot down your impressions after you leave the store. Ask yourself:

• What product lines do they carry?
• How much of their product selection overlaps mine?
• Were the prices similar to mine?
• How was the customer service?
• What was my overall impression?

Finally, ask yourself: What is this store’s competitive advantage? Is it their service? Selection? If you can name it, why don’t you do it? What’s to stop you from having a coupon for 40% off a single item? What’s keeping you from being open on Sundays? Don’t assume that you can’t compete with their competitive advantage.

Defining YOUR Competitive Advantage

Ask yourself: What makes MY store different from the independent down the street? What benefit does my customer have when buying from me?

There are three ways stores can set themselves apart: Selection, Service and Price.

Selection

“On a recent trip to Texas, I visited two independent retailers,” says Paulette. “What was interesting was the product selection: both stores carried exactly the same merchandise—right down to many of the same fixtures! As a customer, I couldn’t help but wonder what made the stores different.”

This is why it’s so important to shop your competition: while independents may believe chain stores are the enemy, in truth the other independent retailer in your town is really the one to watch. Don’t carry all of the same products she does—customers won’t be able to differentiate between the two of you!

Customer Service

Ask any independent retailer and she’ll tell you her biggest competitive advantage is customer service. Yet it’s easy to get caught up in the pressures of retailing and forget what it’s like to be a customer! Competitive shopping helps many independents keep in touch with the consumer experience.

You are a consumer, too. Keep track of customer service during your everyday shopping trips. How were you treated at the grocery store? The pizza place? The department store? What tactics do you want to incorporate into your store service—and what tactics do you want to avoid at all costs?

Price

Yes, you can compete on price— yet retail experts recommend you do not compete on price alone. Price your merchandise fairly, offer your customers (especially your best customers) opportunities for special sales, frequent shopper cards and special sneak previews of new product.

Another truth about competing on price, straight from your customers? Consumers shop at chain stores because they’re convenient, not necessarily because of the 40% off coupon. After all, chains are open on weekends and evenings—a retail tactic that appeals to a lot of busy shoppers. And most shoppers don’t necessarily have the time or the inclination to shop every store in the city. They want to be able to buy all the supplies needed at one convenient location.

Independent Advantage #1: Expertise

Are you an expert at the craft you sell? Are you the Stamping Expert, the Scrapbook Specialist, the Paper Queen?

Do you consider yourself an expert? For many independent retailers, this can be a strong competitive edge. Position yourself as a pro: consumers are busy and they want a resource with the answers to their questions, someone who’ll teach classes, provide demos and other modes of education. Train your employees to have these same skills—there’s nothing more frustrating than asking a question of a store employee and hearing, “Well, I don’t know…you’ll need to ask Mary and she doesn’t come in til Friday.” In fact, your employees are your first line of expertise—don’t forget to let them shine in their own talents: Bill Janet as the Chalking Expert, Sandra as the Pearl Ex Queen, etc.

Don’t forget to market your expertise: Bill your cropping parties or Stamper’s Night Out events s as a way to play with the Paper Pros, then demo during the event. Offer to be a personal consultant on technique questions. Have a “Q and A” column in your newsletter, with answers provided by you and your employees.

Independent Advantage #2: Personality

Here’s the truth of retailing: customers buy from people they like. A key competitive advantage can be an emotional connection between you and your customers.

So, how can you forge a connection? Create a persona, a story, a personality. Then support it with marketing efforts. It can be as simple as this: Write up the story of how you came to create your business, then frame and post the story in your store.

Another simple way to establish an identity is to make your employees identifiable. Employee uniforms are the easiest way—that could be an apron or a t-shirt or a themed outfit to coordinate with your store theme. (For example, if you’re the Stamping Safari, why not have your employees in khakis?)

Independent Advantage #3: Community

Get involved in your community. Remember, most craft customers are women, so think about methods you can use to target them: For example, sponsor a Little League team, then offer a special discount on scrapbooking supplies to team moms. Or host a non-craft seminar on issues imprtant to women, such as breast cancer awareness. Your regular customers will come and so will potential customers.

Don’t forget to promote your region. Every area has a look, theme, a style. Establish and promote a regional section of the store; stores in the Pacific Northwest could feature a section with paper patterned with raindrops, die-cuts of the Space Needle and coffee-themed stamps. A store in Charleston, North Carolina will have a completely different flavor. If you have a college or university, get supplies in collegiate colors—especially around game time!

You can also promote a community of customers. Why not profile your customers as a part of your store? Take photos of your regular customers, then post their photo with a little bio about them. Highlight those customers who have won contests or been published in magazines, as well as those customers who are known for coming to every crop or event, or those who attend all your classes. Over time, the wall will grow and make a statement about your level of customer service. Another way to involve customers: Take photos during classes and events, then post them on your store wall or website. Don’t forget to take photos of completed class projects to post on an Inspiration Wall.

Service, Selection and Price: What is YOUR Competitive Advantage?

After competitive-shopping a few stores in your area, you’ll probably have a better idea of what your competitive advantage is. Don’t be alarmed if your competitive advantage has changed since you first opened your store. Retailers who once prospered by offering low prices may have to switch gears in order to compete with a new chain store or a savvy independent.

Keep visiting other stores in order to stay abreast of your competitive environment. You’ll never know what you can do better if you aren’t aware of what your competition is up to!