Grow or... Die

by Phil LeBeau

Let me start by saying this article is not to be confused with the kind of growth that can kill you, which I recently experienced after Thanksgiving... but the kind of growth that makes you uncomfortable. Growth that amazes you and challenges you to be better than you are today. The growth that keeps you relevant and the growth that makes customers come back.

I know this is a bold statement, but if you aren't growing, what are you doing? Staying flat? Or worse... declining? No one started a business to decrease sales every year. The natural product retail sector according to Nutrition Business Journal is growing at seven per cent. Let's do some simple economics and understand this number and what it means versus your growth, and what can be done to increase your growth rate and talk about a company that didn't follow this business rule.

Research in Motion is the most current example of a company that has ignored the "grow or die" principle. Three years ago, RIM was on top of the smart phone market with over 40 per cent market share and a $150.00 stock price. RIM dominated the business user market and was the must have smart phone brand for consumers. Fast forward to today; RIM holds a dismal 22 per cent market share and a $19.00 stock price. There are many theories as to why this has happened, but ultimately they forgot the one thing they were best at – innovating with the business user in mind. I have similar visions of RIM as I do of Nortel and Corel, the other Canadian tech giants who lost their way and are no longer relevant. Don't believe me? When is the last time you booted up DOS and wrote a report in Corel Word Perfect? Now, let's talk strategies to ensure your name doesn't join this illustrious list of Canadian companies.

First, here is what the seven per cent growth number should mean to you. In an industry that is posting growth of seven per cent, if you are anything less than that, you are losing market share. A comparable growth means you are maintaining but not truly growing. Posting sales increases greater than seven per cent is where true growth lives and you increase market share to build your business.

If your business is growing less than seven per cent, read below. For the other groups, continue past this paragraph. There are a host of external reasons why you could be below the growth numbers, but we can't change those so we will discuss what we can. First, don't hit the panic button just yet. Sit down with individuals in your business that you trust, share the data with them and make everyone aware of today's reality. Then take some time and have a frank discussion about your store's strengths and weakness, how your personnel is helping or not, your product selection, your marketing efforts and what is the one thing that makes your customers come back. As a tip, you cannot use price as a reason why your customers come back. The reality is, your business needs an overhaul, but knowing where you can improve and determining your core strength allows you to rebuild a base.

Flat businesses have a choice to make – continue down your current path or take a step into deeper waters where you might not be comfortable. Like all retailers, you must know your core customer. Know them a bit deeper than before and write out not a demographic profile of who they are, but their state of mind. What motivates them to buy products? Why do they shop in your store? Do they support local? Are there activities they are involved in? Who are they exactly? Take a proactive approach by implementing an outreach program and engage them in the community where they live, hold education seminars and build yourself as the expert in natural products and health.

Better than seven per cent? Congratulations! You are doing great today! But learn from RIM...just because you are successful now, does not mean you will be tomorrow. Revel in your success, then forget it and move on. At this point, changes are risky but it most likely was your willingness to take risks that allowed you to get where you are. The lesson to take from RIM is to keep innovating and improving the shopping experience, but do not forget your core. The best time to try new programs and events is when times are good. This is your chance to go outside the box and really engage in social media. Take your marketing and store experience one step further. Here is a suggestion for taking each to the next level. For social media, try social media outreach. Social media outreach is where you actively engage consumers where they communicate online. Search topics on twitter that are of interest to your customers and add value to the conversation. A suggestion for your store is to increase the "romance" signage to educate the consumer right at the product. Romance signage is a story about the product at the shelf that allows the customer to understand the product and creates a personality for your store.

Unfortunately, we all can't grow beyond industry average, but with some hard work and dedication to education, customer service and proactive engagement, you can ensure you have customers well into the future!

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