Prof. Dr. Dirk Morschett, Professor at University of Fribourg/Switzerland
“Retail Branding” has been preached for almost 20 years now, demanding a strong brand message and a clear, distinguished profile of retailers. However, according to Prof. Dr. Dirk Morschett, Chair for International Management, University of Fribourg, many TCG retailers around the world have not yet developed a unique value proposition but are exchangeable with many of their competitors. And the rise of online competition is just making this deficit more obvious than ever. We asked Dr Morschett what he sees as being the “general scenario” at the moment.
If a retailer is not really different from the competition, why should a customer not pick the lowest available price? In my presentation, different options for a clear and differentiated positioning, including services, in-store experience and category management will be presented. Of course, everybody tries to be good – better than the others. But this is not enough for differentiation.
“Define a clear brand message, based on the distinct character of your company”
How should retailers do things differently then? Should they dress differently? Talk differently? Redecorate the stores?
First of all I think some specialisation in the overall merchandise mix is very helpful. You see this in groups that have more domestic appliances or consumer electronics in the same company. For example, in Switzerland, we have Inter discount and Fust, and they have a clear differentiation against each other. Fust is more about home appliances and services, along with financing and so on. Interdiscount is more centred on consumer electronics. They are clearly differentiated in what they offer – or do not offer – services in specific fields, as well as in the way the stores look. In food retailing, a lot of attention is paid to category management, with the profiling of categories. You decide what categories you want to put up-front and you tailor the rest around this. This is something we see a lot less of in other sectors. Everyone appears to be trying to have a big assortment, the best prices, home delivery and so on. Where is the differentiation? If they all play the game this way, it means only the biggest and cheapest will survive.
In a nutshell, what is the key message you are delivering to the retailers? Define a clear brand message, based on the distinct character of your company. Try to follow this in the way you shape your services: what services you offer, and which ones do not fit to that. What assortment do you offer, and what assortment do you not give a lot of shelf space.