In this article, I’ll explore the cases of Toys R Us and Maplin and analyse their failings in relation to industry experts’ findings.
Suggestions for explaining the failures of both retailers have so far included the locations of the stores, the rise of online giants such as Amazon and eBay, the rise in supermarkets selling toys and stationary, and changes in consumer buying and childrens’ interests, as well as the traditional achilles heels retailers face such as cashflow shortfalls and high levels of seasonal dependency.
But for me one theme put forward my several analysts stood out for me as being a very important and wholly preventable point of failure that affected both Toys R Us and Maplin – a failure to embrace customer experience and business transformation in an age where it is more and more essential to do so for a business to survive and thrive. In Maplin’s case, while it blames a slowdown in consumer spending and weakening of Sterling since the Brexit vote, the company itself also cited “competition from online rivals” as an important factor in its situation.
Yet as well as creating these shifts, the digital age also offers even greater potential for businesses to create exciting and seamless customer experiences, simplify business processes, and transform the ways in which the organisation operates.
In a report outlining UK trends in 2018, Deloitte states three areas that should be priorities for retailers:
One of the key components of ‘reimagining the store’ is “putting digital in your physical”, in which Deloitte claim “retailers are realising that the biggest impact that digital can have on their business is in-store. Some of the most innovative and compelling stores make digital a core part of the store experience”.
The BBC agree, citing a “lack of drama” in Toys R Us stores as one of five reasons for its demise. They contrast the hands-on and inspiring customer experiences created in the likes of Disney and Lego stores for example with the more bland, warehouse aisle style layouts of Toys R Us which fails to excite children.
Further to this, the same article takes the view that “the digital ecosystem can be an opportunity as well as a challenge”. An example is also cited of a four-year-old child looking on YouTube to inspire his toy collection, and how Smyths Toy Superstores use the digital experience to enhance and work in harmony with the in-store experience. “But Toys R Us failed there too”.
This last point about integrating digital with physical is another key point explored in the Deloitte report. For them, digital experiences, Augmented Reality and Virtual Reality “are set to transform the retail experience both online and offline, often connecting the two with more immersive experiences”.
While seamless and visually impressive customer journeys, in-store experience and continuous consumer engagement are vital parts of the digital age which Toys R Us appear to have overlooked.
However full business transformation is about much more than the storefront – customers, competitors and consumer culture are in a constant state of flux, and as a result only the most forward-thinking and agile companies are thriving.
Initiatives such as try-before-you-buy and checkout-less stores and online experiences are underpinning the seamless consumer experience that differentiates the best from the rest in the modern world.
And interaction with consumers has changed in drastic ways. No longer are generic, outbound-only communication approaches effective – retailers and brands need to be immersed and engaged in conversations directly with their consumers, and sending tailored offers to them based on their behaviour and habits. For Deloitte, “brands are targeting individual consumers with individual offers and experiences and retailers need to respond by intensifying their focus on their consumers and what their offer means to them”.
While external factors may have played a part, my view, and one that is shared by many retail industry experts, is that Toys R Us and Maplin’s downfalls were caused in no small part by a failure to embrace the tools and opportunities that the digital age offers – the failure of both firms, in different ways, shows how customer experience just became even more crucial to business success.
The highest cost for any organisation is acquiring and keeping customers. Does your organisation have a true understanding of who your customers are and how they interact with your company? Can you say, with confidence, that your company designs products and business processes that attract the customers you want?
Good customer mapping tools outline the path for creating winning customer journey maps that enrich customer experience, strategies for connecting these maps to processes, IT systems, business requirements and business capabilities.
In its Tech Spectrum for Customer Journey Mapping 2017 – mapping the voice of the customer report, independent analysts Aragon Research evaluated 15 companies that provide customer journey mapping software. Download the report to learn about the top three reasons to embrace the shift to customer journey mapping, how a customer-first focus is paving the way for businesses transformation, and key aspects of customer journey mapping solutions.