Retail Relationship Development

In the past the eCommerce retailers were at a distinct disadvantage as compared to their brick and mortar competitors from a business relationship aspect with customers because of the sales associates opportunities and abilities to interact directly with consumers.  Over time though this advantage was essentially eliminated with the realization of the retail omni market when the brick and mortar retailers focused on low cost product sales. This focus on cost forced the large legacy retailers to reduce the sales associates in the stores and this combined with eCommerce channel elimination of direct human interaction with consumers left a serious hole in the business relationship and even the capabilities of the legacy retailers to develop the relationship that consumers are still in search of.  

Retailers are now beginning to realize the necessity to develop these business relationships with consumers and also the partners supporting the retail marketplace.  This is truly the next phase of the retail omni marketplace. Part of the reason for the new realization is the practices developed by the initial pure play eCommerce retailers like Amazon to build business relationships with their customers.  I believe that Amazon, for instance, has shown an almost single minded focus on delivering a consumer experience that not only saved money for consumers but also the development of consumer relationships and social interactions with consumers to create the stickiness that would continue to encourage consumers to return.  Granted, Amazon took advantage of the fact of the extreme cost savings presented by the fact that they had no store network to support and increase the overall costs.

For Amazon, the cost savings drew customers and then the social network capabilities and interactions encouraged consumers to return.  Amazon has a huge lead and advantage in their business relationship practices and capabilities because of their continuous focus on improved relationships and there early commitment to provide a positive customer experience at the expense of profits.  This strategy paid off quite handsomely and now Amazon has replaced the legacy retailer as the leader in the marketplace providing continued leadership developing and implementing new capabilities to build on their relationship development practices.

The large legacy retailers have been focused on developing purchasing options to grow their omni market presence and this is allowing them to slow the market loss, however these retailers must expand their focus into the business relationship development methods with consumers and other market partners in order to enhance the customer experience and encourage the consumer to return.  The legacy retailers were starting with a distinct disadvantage because all of their business relationship development was based on direct customer interaction with the sales associate and their focus on low cost pricing forced them to essentially eliminate their sales associate staff and redirect their efforts to stocking. They really have not learned the value of the relationship with the customer because enter into a relationship with the attitude that they are the center of the universe and this does not work when developing a strong relationship.

The legacy retailers must now focus on developing and encouraging relationships with both consuerms and other partners.  The market will not wait and consumers can be rather fickle if your only offering is low price. Retailers must also realize this relationship development is not a once and done practice but a long term journey.