Posts Tagged 'Circuit City branding'

A tale of two cities (aka why is one brand experience not like the other?)

In the past 2 days I had 2 different retail experiences that I would like to share.  One of them is clearly helping to drive business.  The other is clearly driving away business.

This is the tale of Fairway Markets and Duane Reade.

On Sunday afternoons the Broadway and 74th St. Fairway Market is a complete chaos.  The aisles are jammed.  It’s getting close to dinner time.  Hungry and impatient New Yorkers are picking-up last minute things for dinner and for packing school lunches.  Then you face the line at the cash registers.  At any other retail store the lines would be intimidating.  At Fairway they move.  They move fast.  Next.  Register 3.  Next. Register 7.  Next.  Register 2.  

The cashiers are fast, fast.  They’ve been trained in speed shopping.

On just about any day you can walk into just about any Duane Reade in the city and see 3 or 4 people standing in line.  You go about picking up the items you need, hoping against hope that there will be no line when you get back to the register.  But the line has grown to 8 or 9 people.  You stand patiently, waiting while the one cashier calls the manager for a price check.  The manager looks at the line and begins the process of opening a second register.  By this time the line has added several more people and not a single transaction has been completed.  Soon people drop out of line.  They put down their items and head out the door without making a single purchase.  Business is walking away.  

While standing in line at Duane Reade I made some mental calculations of how much business they must lose due to the check-out situation.  They claim to have over 250 locations in the NY area and are the fastest growing in the category.  If they could fix the experience, then they would be able to do more business with fewer locations.  The cost of retail space in NYC is much higher than the cost of hiring  another cashier.  

Duane Reade recently underwent a big rebranding program, too.  All of these resources spent on expansion, branding.  But the fundamental business problem appears to be the shopping experience.  It would seem that they could improve their brand reputation and business performance by an internal program centered on the customer experience and employee pride.

This was much the same problem that brought down Circuit City.  About 18 months before they went under, Circuit City laid-off 3,400 of their best, most experienced sales people to save money.  That led directly to a decline in sales, particularly of high end items that require more expertise and hand-holding. Imagine if Circuit City had instead cut their ad budget and poured those resources into keeping and motivating the best sales people?  Is it possible they would still be around today?  To be fair, the economic latke dealt them a huge blow when they were already weakened.

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