American retail tends to attract a lot of flak on an international level. Perceived as excessive or wasteful, it is seemingly often expected to be very apologetic about its existence and success — because make no mistake, it is very successful.
And while the retail industry as a whole is going through some major changes at the moment (driven by digital technology), it would serve us all well to remember why the American retail style has become so influential worldwide.
What makes it so appealing to customers? Why do they venture into American stores and leave with bags full of items they had no intention of buying before they entered? Let’s take a look at some things that American retailers do better than anyone else.
Walmart founder Sam Walton knew something very important: that the layout of a physical space affects not only how we perceive it but also how we engage with it. We don’t tend to venture into stores with the intention of filling up our carts with chocolate, candies, and cheesecakes, after all — that kind of impulse purchasing needs to be carefully cultivated using locational prompts.
Accordingly, Walmart really led the way in distributing products to maximize foot traffic and spending, and other retailers in the country followed suit. From the smallest convenience store to the hanger-like space of a superstore, retailers in America are quite brilliant at burrowing the essentials all the way at the back so that customers must navigate past aisles of tempting treats in order to reach them and subsequently pay for them.
By now, the American model has spread across the world, but that’s a testament to this very point — and it’s true of almost everything in this article because people are always quick to adopt successful methods.
When tourists visit America — particularly in the biggest cities — they tend to have a reaction along the lines of “Everything’s so big!” (even more pronounced in Texas, of course). In many ways, this is because of America’s infrastructural modernity. Because most of its roads and buildings were created relatively recently, America’s cities tend to have somewhat logical arrangements. Why is this relevant here? I’ll explain.
American retailers can offer enormous product ranges for two main reasons: firstly, they can bring in just about anything they need without having to go outside the country (which cuts way down on shipping costs and import taxes), and secondly, the ease of the road system makes it considerably faster to bring in goods from elsewhere.
A store like Walmart or Target can accordingly have a massive range of items offering vastly more choice that you’d see from a similarly-sized store in most other countries. And because America is culturally such a melting pot, that variety is compounded in a fascinating way.
Despite America’s culture spreading across the Western world and beyond through the influence of its media, something that never really reached Europe is the Walmart-innovated concept of the greeter — an employee who (as the name suggests) greets each new customer with a smile and directs them wherever they need to go.
But we can go beyond that to in-store customer service in general because American store assistants are decidedly more helpful than their international counterparts. Why? Again, there are two reasons I can see: firstly, American employees often rely to a much greater extent on performance bonuses (and even tips), incentivizing them to do their best at all times — and secondly, it’s something ingrained in the culture.
In many parts of the world, the practice of having a polite conversation with a stranger has fallen firmly out of style, but the concept of the friendly and helpful stranger is still something that American retail sees value in. After all, first impressions always matter.
I write extensively about the e-commerce industry, and it’s always interesting to see how short-term thinking affects online retailers. Standard practice today is to stay detached from the business side — assign a small budget, get your hands on an Oberlo store (a retail site equipped to sell items through a third-party supplier), run some PPC ads to make some sales, then move on to the next venture. It works, but there’s no build-up, no momentum to be gained.
What the top global brands learned from America (and continue to excel at) is that one loyal customer is worth several new customers. The longer you stick with a company, the more you’ll spend with them, and the more positively you’ll view them — and the more you know about a customer, the better you can cater to their needs and win their loyalty.
It can go very wrong, of course, as with Target’s notorious pregnancy incident years back, but retail analytics, in general, is a very cost-effective discipline, and America led the way. Walmart has a state-of-the-art processing center designed to draw inferences from customer data and identify which products should be marketed to which people at which times. It might sound disconcerting, but if you don’t object to that kind of analysis in principle — many don’t, I among them — then America’s focus on big data is a net benefit for your shopping.
To recap, then, America’s retailers do four things better than anyone else (in my opinion, at least): lay their stores out to maximize revenue, vary their inventories, make positive first impressions, and invest massively in winning and retaining customer loyalty. Some may not like the American retail model much, but I’m personally a huge fan!
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